FDI outflows in September is put at $3.46 billion

According to the RBI data, as many as 401 overseas investment transactions were carried out by various companies in September, with the GVK Power & Infrastructure leading the pack

Mumbai: Overseas investments by Indian companies in September were $3.46 billion, with GVK Power, ETHL Communication and Tata Steel, among others, committing investments abroad, reports PTI.

The FDI outflows last month was 51% more than the $2.28 billion outflow in August.

According to the RBI data released yesterday, as many as 401 overseas investment transactions were carried out by various companies in September, with the GVK Power & Infrastructure leading the pack.

It has committed $1.41 billion in its Singapore-based joint venture—GVK Coal Developers (Singapore) which is engaged in transport, storage and communication services.

ETHL Communications Holdings has committed $776.88 million in its Mauritius-based wholly-owned subsidiary (WoS).

The subsidiary, ETHL Communications Mauritius, is engaged in financial, insurance, real estate and business services, the data said.

Tata Steel has committed $173.55 million in its Singapore-based WoS, Tata Steel Asia Holdings Pte, which is also engaged in financial, insurance, real estate and business services.

RHC Holding investments in its WoS based in Mauritius has committed $113.62 million investment. The WoS is engaged in similar business as that of Tatas’ in Mauritius.

As per the data, Jindal Saw has committed invested $78.64 million in September in its Cyprus-based manufacturing WoS—Ralael Holdings. Besides, the Indian firm has also committed an investment of $48.31 million in n its UAE-based WoS Jindal Saw Holdings FZE, which is also engaged in manufacturing activities.

In the first six months of this fiscal (April-September), the outward FDI stood at $19.01 billion.

While Indian companies are spreading their overseas footprints, the FDI inflows in the April-August (latest data available), too, went up by a huge 95% to $17.37 billion from $8.89 billion in the corresponding period last year.

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FII limit for purchase of G-secs to be raised soon: Finance ministry

A finance ministry official said that the FIIs have almost exhausted the Rs43,650 crore ($10 billion) investment limit for purchase of G-secs and they would not be able to buy more securities unless the ceiling is enhanced

New Delhi: The government is likely to soon increase the purchase limit of government securities (G-secs) by the foreign institutional investors (FIIs), a move that will help it meet the enhanced market borrowing target without hurting liquidity position in the system, reports PTI.

The FIIs, a finance ministry official said, has almost exhausted the Rs43,650 crore ($10 billion) investment limit for purchase of G-secs and they would not be able to buy more securities unless the ceiling is enhanced.

As per the latest data, the FIIs’ investment in G-secs were at Rs42,388 crore.

“We could increase the limits for FIIs investment in G-secs soon as we need money,” a finance ministry official said without specifying the proposed limit.

G-secs comprise treasury bills and dated securities issued by the central and state governments.

The government last month revised its market borrowing programme for 2011-12 and decided to raise an additional Rs52,800 crore. Following the revision, the government will raise Rs4.7 lakh crore from the market, up from Rs4.37 lakh crore in the previous fiscal.

There are apprehensions that increased government borrowing would reduce the credit availability for the private sector.

The government had earlier relaxed the norms for FII investment in long term infrastructure bonds.

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Indian economy to grow at 7.5-8% this fiscal: Chief economic advisor

“There is slowdown across the world... our growth rate would be 7.5% to 8% (this fiscal) ...India is one of the slowest slowdown,” chief economic advisor Kaushik Basu said

New Delhi: Amid concerns of a global slowdown, chief economic advisor Kaushik Basu on Monday said the Indian economy is expected to witness a growth rate between 7.5% and 8% this fiscal, reports PTI.

“There is slowdown across the world... our growth rate would be 7.5% to 8% (this fiscal) ...India is one of the slowest slowdown,” he said at ADB-India partnership silver jubilee celebrations here.

In the first quarter of the current fiscal, the Indian economy posted a growth rate of 7.7%.

“We do expect some slowdown in exports in the second half of this year. Foreign direct investment for this year look very, very good,” he said.

Long-run drivers of growth are remarkably good, he said.

Earlier in the day, finance minister Pranab Mukherjee said that in the medium to long-term, India remained firmly on a high gross domestic product (GDP) growth path of 8.5%-9%.

“We, however, need to be alert and respond to emerging challenges and concerns, in a timely manner as we make efforts to achieve our potential as a young fast growing nation,” he said.

Chief economic advisor Kaushik Basu said partly attributed rising inflation to high wages. In India, the biggest inflation in the last one-and-a-half years is taking place in the labour-intensive sector, Mr Basu said.

“This is a sign of rising cost of labour and also we have data now that wages are inflating faster than good and services,” he said.

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