The Real India The Virtual India
|Who stays here?||People of
India in 35 states
|NRI’s & PIO’s in 5 continents|
|Gross domestic Product||US$ 692 billion||about US$ 240 billion|
|Per Capita Earning||US$ 625/year/person||about US$ 10,000/year/person|
|Savings Per Year||US$ 100 billion**||about US$ 75 – 80 billion**|
|INDIA’s external debt||US$ 121 billion||N.A.|
|Total FDI last Year (2005)||US$ 6 billion||N.A.|
|FDI investment by NRI’s||US$ 0.2 billion (in 2004)||N.A.|
|Population||1090 million||20 – 22 millions|
1. Understanding the Real and Virtual India!
There are two India’s, one where we live and the other is the Virtual India, with an estimated GDP of US $ +240 billion per year, where about 20 to 25 million NRI’s and PIO’s live.Their hearts are in India and they are emotionally tied to India. If we can attract them and woo them, they could be a good source of funding projects for India’s growth plans.
The Chinese have learnt the art of wooing and managing their NRC’s who number about 55 to 50 million. Last year the NRC’s invested about US$ 70 billion into China + Hong Kong + Macau. India, inspite of its best efforts, received only US$ 0.2 billion from NRI’s last year!
India imports nearly US$ 8 to 10 billion worth of Gold every year. This means that we have imported nearly US$ 96 to 120 billion worth of Gold, in the last 12 years, since liberalization of the economy.
We should try to find ways to ‘funnel’ this retail investment into more economical areas, to benifit the Nation and it’s people.
2. How has China managed to get large FDI inflows from the NRC’s?
Maybe, there is a lesson to be learnt by us, as to how China is able to woo its NRC’s!
The largest banks in Hong Kong, HSBC and Standard Chartered, may be able to throw some light on how the NRC’s have been able to invest so much in to China and Hong Kong.
• FDI …. means – Foreign Direct Investment • US$ 1 billion is Rs. 4900 crores
• NRI …. means – Non Resident Indian • N.A ….. means not applicable
• NRC … means – Non Resident Chinese • **means , estimated figures
• PIO …. means – People of India Origin
3. India’s POT of GOLD —how can we get it back?
It is estimated that a large amount of “Indian Money”, is lying outside India, due to poor governance & administration of India and due to past regimes of controls and high taxation. If India can put its “House in Order”, to near World Class Standards, a substantial part of this money could easily come back to drive the Indian economy.
Unofficial estimates of Indian funds lying outside, range from US$ 400 billion to US$ 800 billion! India’s total foreign debt is about US$121 billion.
The interest rates are very low in the international markets and interest rates are also dropping in India. NRI’s and PIO’s would be interested to invest in Indian paper with reasonable rate of interest and attartive tax incentives.
The Indian Central and State Governments should plan for 10-15-20 year Infrastructure Bonds, with a coupon rate of 4 to 5%, both for domestic Citizens as well as for NRI’s, with tax breaks and incentives. Or it could be a floating rate, based on some standard base rate, + a premium of 100 to150 basis points.
India requires US$ 500 to US$800 billion for Education, Health Care, connecting the Water Ways and Rivers, for Ports, Airports, Railways and Roads.
After the 2nd World war, when Germany was devasted, the German Government came out with a similar scheme to build the Nation. China has had a novel scheme for many years. It may be a good time to consider such proposals. The present rate of borrowing for Infrastructure Projects is too high!
4. Only Good Governance and Effective Administration can attract higher FDI into India and induce money to flow back.
Kindly write for more complete information & details of i watch-Transformaing India booklet.
Ajay Singh Niranjan ( email@example.com)
i watch www.wakeupcall.org Education 1st
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