Why are foreign firms investing less in India and taking their money out?
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- Опубліковано 21 тра 2024
- Not only is foreign direct investment into India falling, but foreign companies are increasingly taking their money out of the country. India's share in global FDI is also falling. Deputy Editor TCA Sharad Raghavan explores the data and the reasons why.
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The issues raised by Raghavan are impossible to be solved by government. It requires the politician to make themselves less powerful by making agencies independent.
At the middle and lower levels of bureaucracy, not only the corruption is high, but they are also obstructionists. This is definitely true of gst and customs departments.
Really? Who could have thought! It is almost like the entire government-system is failing the nation. Then why not install a new government-system?
Both Congress and BJP block any attempts are reform when in opposition. There should be bipartisan agreement atleast on foreign investment policies
Interest rates are high in US. This will naturally cause direction of capital back into the US. But domestic investment is rising, as you yourself spoke about in previous video!
FDI is not when a foreign company put an FD in Indian Bank to get interest 😂
Its when they invest in business in India to get a greater return for the money. If foreign companies are thinking that it's best to put the money in American banks than doing business in India, we are really screwed. It literally shows how pathetic the condition of India is.
Also, for a country's development, specially a developing country like ours, we need FDI, a lot of FDI. We are not going to do much with domestic investments.
@@sibimanjale That is the thing. After a long time, US has moved away from 0 interest. Obviously that the decrease in fdi will be seen. Clearly apparent from the decrease in investments from 20-21 periods when US was filled with liquidity.
That said, many family offices have entered the game where domestic investments are rising as they are looking for alternate forms of investments as well.
Overall, FDI is required. However, the economic situation of the world today is far from ideal. So, the decrease is not a result of India being pathetic. Actually, being in business, the ease of business has heavily improved in India. Many of these policies should have been taken by the country way back in 90s when the economic climate was much better. However, let's see
FDI Inflow by Country | Vietnam : $9.58 Billion(2008) $17.90 Billion(2022) | India : $43.41 Billion(2008) $49.94 Billion(2022) | Indonesia : $9.32 Billion(2008) $24.70 Billion(2022) | How long are we going to blind to all indicators?
I appreciate under 5 minutes format.
I trust you and The Print, so I don’t require long videos (those are great too) I’m happy with short videos like this one.
Thank you 🙏🏽
Hi,
Thank you for your feedback!
There could be negative perceptions in the west and Japan due to India's policies with respect to certain countries which they regard as unfriendly and these may lead to sanctions down the road. So some companies may be in-shoring as they say instead of looking out of shores. Mexico is benefiting from this trend.
If you're talking about FDI and you're excluding the high interest rate regime currently in place in OECD countries, you're missing the point.
And US Fed is not likely to reduce interest this year. Capital flight will continue. But domestic investment could increase though, as Sharad covered in previous video.
@@rajx7120that'll happen after election. Most companies have publicly stated that in their previous quarter investor calls.
@@rajx7120you should listen to quarterly investor calls. Most companies are pausing their investments until after the election. The drop in domestic investment is expected.
@@rajx7120youtube censors the word in vest ment. Companies are waiting until after the election to start that process.
@@rajx7120domestic will happen after elections. They have said so in their quarterly calls.
Thank you for this brief but substantive report, Mr Raghavan. I have a question - does the data capture IN/OUT flows from Indian companies/individuals? I read that high net worth Indians had been exeternalizing their wealth at a accelerating clip. Thank you.
Great observation 👍
It’s a great sign of India’s progress. India doesn’t need foreign money. People should chill! India is becoming atma nirbhar.
People are cheering about the investment facilitation in trade deals such as the recent EFTA with Nordic countries. However weeks after that we kept our foot down at WTO for an investment proposal brought in by China. Secondly the kind of foreign investment coming in is also questionable. Yes, India saw a record FDI in FY 2021-22 but most of it was secondary investment as the RBI AFR of that year pointed out for example Meta's investment in Reliance & other
Good video. Thanks for knowledge sharing.
How does high interest in oecd countries affect FDI flow. My understanding is FDI is more stable due to investment in capital assets, opportunity creation. High intetest in oecd countries can affect FII. Anyone have this clarity?
What about expensive valuations of the businesses? That can also be a factor. Also, it is the flow which has reduced and not the overall gross investment
Good 👍 Analysis
Nice One
Additionally Inconsistent trade policies, counterproductive Protectionist measures, over regulation are some of the issues i have observed
Thanks for the HONEST economy update.
Reduced FDI means less capital inflow for investment and expansion, potentially leading to slower economic growth. With fewer foreign investments, there could be a slowdown in job creation. A drop in FDI may lead to reduced access to advanced technologies and expertise, hindering technological progress. A decline in FDI can also impact the trade balance by affecting export-oriented industries and reducing the competitiveness of domestic products in global markets. While India Inc.’s bullish outlook on the country’s economic prospects is certainly positive, the decline in FDI could still have notable implications for the economy.
Reduced FDI /higher domestic investment has positive aspects. Low volatility, less dependency and foreign threats. India has a large marketplace and if we can boost local production within instead of depend on China, it will create jobs and build local economy
@@GoGreen99962
To remove our dependence on China and be upto their capability we need to have skilled workforce like they have in a new tech products.
Our Govt is busy 24/7 doing Hindu-Muslim sadly.
@@mg.f.9023 Not every industry needs super skilled people. China being a communist country can take lands from people easily and give it to build factories. This is tough in India as there's democracy/freedom/legality involved. Also any trade union or dissent is brutally crushed. This can't happen in India. Still, Make In INdia has potential and working & must not be compared to China
@@GoGreen99962
The relative advantage China had is they did not have to waste time over religion!
@@mg.f.9023 yes...they handled uighurs the way they wanted and the rest of the world just silently watched...that's how they deal with religion
I follow the electrocuted Viking on UA-cam. He’s skeptical about FDI in India. He said the Indian government has a history of seizing companies’ assets and factories, gangsters are locally elected, too much government corruption. If the Indians can remedy these issues, FDI will increase.
You are voicing the opinions of China, so it's irrelevant.
Economics can only happen in Rule of Law
Indian IT and BPO service sector is hit by AI, may be that could be one of the reasons
This so called economist is always worried. Even if the economy of India ie GDP is growing at 8.2 percent world's fastest rate ( among the top largest economies ) .
These news channels sell for 5 yuans in Guangzhou market
why are you fattening the bars' width?? to me this looks like what the market trends have been in USA especially. FDI dropped around the time when USA and west faced financial crisis post covid. FDI still is 2 times the UPA time. Though, considering the inflation, the growth could be better.
Considering inflation and the loss of value of the rupee, there is barely any real growth 😂
Andhbhakt do not understand FDI, FII , they are bussy in collecting 5 kg free ration.....🤣🤣🤣😂🤣
And chamchas don't under high interest rates of US Fed !
Pathetic bro
i am ashamed of myself , as i was one of you back then
Aanand Aa gaya bro.
Lack of confidence in government (Facism is rising, it put investor off )
BJP till 2047❤
@@RKV0785 Hosakta hai Bharat ke tukde ho(Facism ki wajah SE)
@@RKV0785 Maine ek kitaab likhee hai,ous Ka naam hai Rs.2 AUR kitaab ki keemat hai Rs.2 Railway book stall per milegee
Pakistan jao if you want a government without fascism. Aur wahan se bharat ke tukde karne ka dream apne grandchildren ko dena.
This is a misleading video:-
1. There is no such trend as its just this year not previous year. No new domestic change has happened, this is due to foreign uncertainties (wars mainly)
2. What do you mean by “nobody told on record but print found out” , this is a very shady statement . You have to give more details to back up your statement. Don’t mislead and share false information. Or else call it your opinion.
I expect better from Print
You want the ED on your back ? Why don't you face the facts !
@@xcel5203 he doesn't want the ED on his back..that's why he is parroting Jaishankar level propaganda
@@MARKCRASTO ED is the new buzzword i guess😁😁.
Do you a slightest idea what ED does, its last 10 cases or chargesheets.
Go read you illiterate and then lecture me.
What he's so in the video is absolutely true. 1. Low level corruption, harassment by public officials and obstructionist attitudes. 2. Lack of faith in the speed and fairness of judicial system especially at the lower levels. 3. Punitive actions by any number of government "agencies" . It affects both ease of doing business as well as ease of living in India.
Meri jaan you from PRINT..will do everything to make a good case against India and Modi.😂😂😂😂
Modi is the culprit.
Vedio dekha ❤day
Answer is an uneducated PM
"Foreign companies see be less excited about India than they used to be...". Of course, they should be. They need to be interested only to a reasonable extent that is required & permissible. Not more. Most recently, the FDI in NewsClick by China led to a concerted campaign of disinformation by break-India forces and threatened national security. A while back, China's excessive interest in India resulted in an MoU (signed by INC in 2008), and we saw how our markets consequentially were excessively inundated by Chinese goods; this adversely impacted our own local people delivering goods via small-scale industries. If you go much further back in time, we all know what was the result of the excessive interest of East India Company in India.
So The Print, save your insincere analysis.
Modi modi modi 😂
Aisa mat socho ham hindu hai isliye bach jaengeAur laga ki tum jaise youth hi desh ka Bhavivysaya aur ye politics kitna brainwashed rakh rahi hai ham youth koAaj muslaman maar kha raha kal kisaan kha raha tha ek din jab sawal poochona choge to ham bhi kahenegeAur phir tumhe lagega bahut der ho gayiYe neta log politics ko isliye hi aisa rakhte hai taaki ham jaise youths inki taraf na dekheHam reels ke comment kattar hindu likhne mein busy rahenge aur ye log desh ka bantadhar karne mein lage rahenge😊
Propaganda dollars' 😂😂😂communist jhoola lekar economy freebies wali😂
Actually there's no meaningful investment whether under UPA or NDA Governments. Black money routed through mauritius is coming to india as investment. No political parties are speaking about judicial reforms. India sucks.
you don't know that doesn't mean , they don't exist
India is where money goes to die
FDI IN INDIA IS AT A 16 YEARS LOW BECAUSE 'PAWPAW' NE INTERNATIONAL DANKAA BAJA DIYA HAI!!😂😂😂
It is a good thing and no one should invest in india as it is broken
Well it's not as broken as China.
Dont worry Modiji will take care of it. He is capable of anything.
People get assured returns of 5% in US treasuries. So capital returns to US. India is already expensive by the PE ratios. China was most corrupt but still attracted capital because of returns. BTW all these conditions were still present in India when the FDI came into India. You are trying to put forth your myopic views and its hilarious you are advising the new govt.