According to the Sovereign Brands Survey, Egypt, Germany, Brazil and China are among the most familiar and the most favourable
India has been placed alongside the US and the UK as the least familiar and least favourable to sovereign wealth fund (SWF) investment, a new survey has revealed, reports PTI.
According to the Sovereign Brands Survey, conducted by research and communications strategy consultants Hill & Knowlton and Penn Schoen Berland, Egypt, Germany, Brazil and China are among the most familiar and the most favourable.
The survey looks at the factors on which SWFs intended to invest in their country or industries.
Stephen Davie, Hill & Knowlton's head of financial communications in the Middle East, said: "Despite being considered one of the least volatile forms of investment compared to other sources of capital, it is surprising that low familiarity still drives low favourability towards this type of funding.
The survey results show by working on their reputation and by increasing awareness of their SWFs is a key step for Middle East countries looking to open up significant investment opportunities."
The survey identified transparency as essential, 72% citing this as very important, closely followed by accountability (68%) and good governance (65%).
Dubai did not score well on transparency with Western countries—only 3% of UK, 9% of the US and 14% of German respondents believing its SWFs to be transparent.
Asian countries had a more positive view with 29% of Chinese and 30% of Indian elites having confidence in Dubai's approach.
Nearly three quarters (73%) of elites would approve of investment coming from Dubai, according to the Sovereign Brands Survey 2010, the most extensive study into the attitudes of global broad elites to sovereign wealth as a concept, the reputation of host nations and sovereign wealth funds (SWFs).
The study interviewed elites in seven markets on their views of 19 host countries and their SWFs.
Nearly all (98%) of the respondents felt the reputation of the country directly influences the reputation of SWFs.
It also identified that lack of familiarity with SWFs may lead to suspicion about the overall objectives of the funds.
The survey showed that knowledge of Dubai is still low.
When elites were asked whether they thought Dubai shares their values, only 1% of the respondents from Germany believed this to be true, while it was 3% in the UK and 5% in the US, compared with 84% in Egypt.
Most countries have a positive view of investment from Dubai, and when asked about the areas they would like to see Dubai investing, the respondents pointed to construction, leisure and finance.
Joel Levy, chief executive officer, Penn Schoen Berland, EMEA, said: "The economic downturn has created a real opportunity for sovereign wealth funds.
SWF's images are largely determined by country reputation, and despite low familiarity and concerns over transparency, broad elites see SWFs as least likely to have contributed to the recent market turmoil.
This puts sovereign wealth funds in a prime position to consider their positioning and reputation in contrast to other funds and asset classes.
The Central Statistics Organisation also revised upwards the growth rates for Q2 and Q3 of 2009-10 on better-than-expected performance by manufacturing, mining and quarrying industries
Driven by a robust performance by the manufacturing sector, the Indian economy grew by 8.4% in the last quarter of 2009-10, pushing up the overall growth to a better-than expected 7.4% for the fiscal, reports PTI.
The manufacturing sector grew by 16.3% in the fourth quarter (January-March 2009-10) and 10.8% in the fiscal.
The gross domestic product (GDP) grew at 7.4% for 2009-10, higher than the February projection of 7.2%.
The Central Statistics Organisation (CSO) also revised upwards the growth rates for Q2 and Q3 of 2009-10 on better- than-expected performance by manufacturing, mining and quarrying industries than first thought.
There was no decline in agriculture growth in 2009-10, despite widespread drought and floods hitting the farm output.
According to the CSO data, the farm sector recorded a growth rate of 0.2% contrary to expectations of negative growth.
Following the global financial crisis, the GDP had moderated to 6.7% in 2008-09 after recording a growth rate of 9% in the three preceding years.
Market may keep climbing but in a halting manner
It looks like it will be a steep uphill climb for the markets. Despite thousands of crore of investment by foreign institutional investors and domestic fund managers, the bourses look like they are going nowhere.
The market registered its biggest weekly gain since early March, as it climbed 1.2% on Friday, with positive cues from the global markets triggered by bargain-hunting after China's assurance that Europe will remain a major investment market. On a weekly basis, the Sensex and the Nifty logged gains of 3% each.
The market tanked over 3% on Tuesday, its lowest in three-and-a-half months, as the Bank of Spain announced the takeover of small-sized savings bank CajaSur.
Besides, the growing tension in Korea also weighed on investor sentiments. However, the indices recouped a major portion of their losses the next day on assertion from China that it would stay invested in Eurozone bonds. The market continued its bounce-back for the next two days.
The top gainers this week on the BSE Sensex were Reliance Communications (up 11%); Jaiprakash Associates (up 8%); Reliance Infrastructure (up 7%); Sterlite Industries and Tata Motors (up 6% each).
The top losers in the index were ACC (down 4%); Tata Steel and Bharti Airtel (down 2% each) and State Bank of India and Maruti Suzuki (down 1% each).
In the sectoral space on the BSE, the realty index clocked gains of 4% while the oil & gas index advanced 3%. On the other hand, the consumer durables index shed 2% and the PSU index lost 1% on a weekly basis.
In a major corporate development over the weekend, the two Ambani brothers-Mukesh and Anil-on 23rd May decided to bury their differences and create an environment of harmony, co-operation and collaboration between their groups.
The truce comes within a few days of the Supreme Court declining to give any relief to the younger brother in the gas dispute.
The auction for Broadband Wireless Access (BWA) kicked off this week with 11 players, including Bharti, Vodafone, RCom and Tatas, in the race to acquire the two slots on offer. The reserve price is Rs1,750 crore for a pan-India BWA spectrum licence. After experiencing success in 3G spectrum auction, the government is now hopeful that the BWA auction would also bring in a revenue windfall. Earlier, the third generation (3G) spectrum auction, which ended on 19th May, ensured that the government would garner in excess of Rs67,700 crore, nearly double the base price of Rs35,000 crore envisaged in the Budget.
Food inflation eased to 16.23% for the week ended 15th May on account of a fall in prices of masur, fruits and vegetables. Inflation declined by 0.26 percentage points from 16.49% in the previous week.
The index for the broader primary articles group with a weight of 22.02% in the overall wholesale price index (WPI) declined by 0.1% to 298.9 from 299.2 for the previous week while the index for fuel, power, light & lubricants with a weight of 14.23% in the overall WPI increased slightly to 365.5.
The monsoon is expected to hit the Indian coast in early June. The Indian Meteorological Department (IMD) expects monsoon to be 98% normal this year, after a poor showing last year that hit crop output and fuelled rise in food prices.
Coming up with a bullish statement on the Indian economy, the Organisation for Economic Cooperation and Development (OECD) projected 8.2% growth in the gross domestic product (GDP) for India in 2010, saying domestic demand will continue to support a strong recovery. The growth is further expected to improve to 8.5% in the next year.
Tractor and sports utility vehicle (SUV) major Mahindra & Mahindra (M&M) has announced that it will acquire 55.2% stake in electric carmaker REVA, marking its entry into the alternative fuel-based passenger vehicle space.
The Reserve Bank of India (RBI) on late Wednesday allowed banks to draw additional funds from it by opening a second window, to meet the expected cash crunch in the system on account of Rs1 lakh-crore demand of corporates to meet their 3G fee and advance-tax payment requirement. The central bank also allowed banks to seek waiver of the penal interest if they have less government securities when they borrow more from the RBI.
The Planning Commission has pitched for linking of domestic fuel prices with those in the international market saying it is necessary for country's global "economic reputation." The government has already formed an Empowered Group of Ministers (EGoM) headed by finance minister Pranab Mukherjee on fuel prices deregulation.
The US Labor Department on Thursday reported that the number of newly laid-off workers filing claims for unemployment benefit in the US dropped last week by 14,000 to 460,000. The Commerce Department said that the requests for durable goods increased 2.9% last month. Excluding transportation, orders in the highly volatile manufacturing sector fell 1%. US companies are benefiting from rising demand both at home and in major export markets.