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Government to recast IIC to attract NRI investments

The Indian government will restructure the Indian Investment Centre to make it more responsive to the needs of foreign and non-resident Indian investors, a senior official said in Dubai on Monday.

A R Nanda, chief commissioner (investments and NRIs), told members of the Overseas Indians Economic Forum in Dubai that the process would be completed in three or four months.

He said the government was considering various proposals made by the IIC to grant it more autonomy and make it less bureaucratic.

Nanda was in Dubai as part of a tour of the region to attract participation in the Global Indian Entrepreneurs Conference to be held in New Delhi on November 12 and 13.

He was accompanied by V K Topa, additional secretary-general of the Federation of Indian Chambers of Commerce and Industry.

Nanda said the IIC was slowly becoming a leaner and more professional organisation, with greater orientation towards information technology.

''You cannot run an investment promotion organisation in a bureaucratic manner,'' he said.

He said efforts were also being made to revive the NRI Consultative Committee and persuade the finance minister himself to chair its meetings at least once in six months.

He said the restructuring of the IIC would give it a bias towards small and medium enterprises.

Nanda said that while foreign direct investment proposals of about $ 50 billion had been approved in the last seven years, actual inflows amounted to only about a quarter of the amount.

He said NRIs accounted for only about six per cent of all FDI approvals but nearly 22 per cent of actual inflows.

Nanda said about 48 per cent of FDI approvals were in the power and telecommunication sectors, where there had been some delays because of the policy issues involved.

But the actual inflow of investment and project implementation had been quite fast in the other sectors, he said.

Analysing the factors that led to project delays, Nanda advised NRIs to do their homework well and appoint good consultants instead of relying on "fly-by-night operators". He said the IIC was planning to offer such consultancy support.

Many of the NRIs present listed the kinds of problems they faced in India, especially with banks and stock market transactions.

They also underlined the need for steps to smoothen admission procedures in Indian educational institutions for children of NRIs.

Some of them spoke about the difficulties that could be caused because of the changed definition of NRIs in the proposed Foreign Exchange Management Act.

Nanda promised to look into their grievances and try and sort out such problems on a pro-active basis.

Topa said India was poised to achieve a growth rate of about six per cent in spite of the economic crises in different parts of the world such as the Far East and Russia.

He said business and industry would have to learn to face growing competition in India.

OIEF chairman Ram Buxani, a prominent NRI businessman, presided over the meeting.

UNI