In his column "Much ado about FDI" (New Delhi Diary, July 24) A K Bhattacharya effectively punctures the disproportionate euphoria created by the Congress party about the recent decisions on foreign direct investment (FDI). The government should be concerned about the lack of FDI in manufacturing in spite of already relaxed caps on investment there. Relaxing investment norms merely creates an interest in potential investors but action follows only after the necessary wherewithal exists to fructify investment as a source of return on capital. The government has done little in this regard, whether it is sound land acquisition policy, supportive infrastructure (power, water, etc.), skilled manpower development, graft-free administrative procedures and labour laws.
Secondly, as the author highlights, between 2000 and now, 30 per cent of total foreign investment has been in the services sector alone. This makes it vulnerable to fluctuations in the global economy as foreign investors desert the sinking ship when they are needed most.
Y G Chouksey Pune
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