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KBC carves niche in Bombay; Belgium keen on taking up BOT projects

The Indian tour of the Belgian business delegation led by Prince Phillipe and Deputy Prime Minister Elio di Rupo witnessed the inauguration of the Bombay branch of Belgium's largest independent bank and insurance major KBC today.

It was also marked by Belgian firms signing two memoranda of understanding -- one with public sector RCF in chemical sector and another with the Tatas in the shipping sector.

KBC Managing Director Herman Agneessens said the Indian foray represents a ''logical continuation of our confidence in India's potential as an economic and business powerhouse''.

Besides helping the Indian corporates on external commercial borrowings and advisory services, the bank would offer a wide range of products both at corporate and higher-end retail segments.

The bank which has been operating in India through a representative officer since 1995, would bring in $ 10 million to commence its full branch operation from early next year since certain formalities like on-line connection with Belgium headquarters are still pending for clearance from the Indian authorities.

The Bombay branch will be headed by the chief executive officer Bart Pattyn.

He said India is a much better place to do business than any other nation in the region. The external position of India had been managed in an outstanding manner by the Reserve Bank of India, he added. ''We look at India's basic strength (barring few weaknesses like huge fiscal deficit) for our potential growth in future.''

KBC will access inter-corporate, inter-bank and repos to enlarge its exposure in Indian business and also maintain its contribution in priority sector lending like small scale industry financing and agriculture financing.

However, Herman indicated that his bank is not going to step into the insurance sector in India in the near future because KBC's insurance activity is limited to European region only. ''Once we consolidated our position in insurance business in Europe, then we would probably think of entering the Indian insurance sector,'' he added.

The bank with a turnover of $ 1.07 trillion, has posted a net profit of $ 450 million in the first half of current year. In view of the troubled economic situation in southeast Asia, the bank made an additional provision of nearly 1 billion Belgian francs towards its exposure in Indonesia, Thailand and South Korea.

Belgium is keen to invest in various infrastructure projects such as energy, chemicals, telecom and transport sectors through build, operate and transfer process in India to enhance the bilateral trade in the coming years, according to visiting deputy prime minister Elio di Rupo.

Rupo said that his country's business delegation had fruitful dialogue and established contacts with top government officials and businessmen in Bombay during the last two days.

Prince Philippe said that Belgium would be looking for diversification of their trade and business with India.

Trade between India and Belgium had doubled up in the past six years, the deputy prime minister said. Belgium exported goods and services worth $ 3 billion in the last six years. There are 55 Belgium companies and banks operating in India.

Out of over 100 memoranda of understanding signed between Belgian and Indian firms, about 30 projects got implemented through direct investment from Belgian firms.

The introduction of Euro from January 1 next year would be a major booster for improving the trade between the two nations.

Indian businessmen can use Belgian cities like Brussels as the gateway to European trade particularly when the Euro would turn out to be the only alternative currency to the US dollar in the world trade. ''We want to share our expertise and wealth in the development of Indian economy and trade,'' Rupo asserted.

He felt that the economic reform process in India would be a continuous programme.

Efforts will be made at the official level to resume direct flights between Belgium and India in the near future, Rupo said.

He said that there were problems of high royalty payment between Belgian airline Sabina and Air-India in 1991 following which Sabina had to withdraw its direct flight from Bombay.

''However, we are keen to resume the direct flight services in order to enhance our bilateral trade and tourism activities. In fact, establishment of direct flight from India to Brussels could act as a major development in the area of tourism and business where the Belgian city could play as a major hub for various destinations in Europe. We would discuss the issue with government officials during our visit to Delhi on Wednesday,'' he added.

UNI

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