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Monday, October 21, 2013

Indian Scams and Policy paralysis effects Foreign Investors

Indian Market is hitting new Highs every day now but there are lot of concerns in the market that will effect future prospect of Foreign Investors.

Indian Market is hitting highs as they are very much in exit polls that NDA will come in power and also Inflation is getting down month by month and Current account deficit is at lowest levels.

But every Foreign investors now think twice before investment in India few reasons are listed below :-

SCAM'S:-
India's whole economy is grappled in scams Indian industrialists and even Ministers are in the list of Scams. 

In past 3 Years lot of Scams comes in Lime light such as:-
Commonwealth scam, 2G scam, coal scam, fodder scam.

Coal scam hits very hard to every mining co. and ministers related with coal industries that tarnish Indian Image globally. 


2G scam rocked all telecom industry and foreign co.s who buy in Indian co.s were at the receiving end as they losses their licences to work in India. 

Falling Rs.:- 

Falling Rs. is hurting India a lot as import bill is rising and due to which Fiscal deficit is on the rise. Also falling Rs. will cause rising cost of Petrol, Diesel & consumable items which is causing high inflation with the result is that RBI will not cut Repo Rate which means interest rates will remain high and no co. will be do business in such environment whose whole business depends upon import and also customers will not buy in such high inflation and high interest rate market. If inflation kept at high then there will not be any room for RBI to cut interest rates so foreign will not keep their fingers crossed to wait for low interest rates. 

Policy Paralysis:- 

Govt. cleared some projects such FDI in Retail, FDI in Aviation but their policies are not clear to anyone. Due to which co.s like Walmart moves away from India and waits till 2014 elections as they are not certain whether other govt. will take back decision on FDI in Retail. 

Vodafone slapped with 11000 Cr tax notice although they won the case in SC but amendment in tax laws are made for tax collection and case is still pending. Why should any foreign co. will come in India when their is no clear policy on any of the issue?? With govt. change rules are changed every time. Even Indian Investors are not clear about Govt. policies.
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Indian Scams and Policy paralysis effects Foreign Investors

Indian Market is hitting new Highs every day now but there are lot of concerns in the market that will effect future prospect of Foreign Investors.

Indian Market is hitting highs as they are very much in exit polls that NDA will come in power and also Inflation is getting down month by month and Current account deficit is at lowest levels.

But every Foreign investors now think twice before investment in India few reasons are listed below :-

SCAM'S:-
India's whole economy is grappled in scams Indian industrialists and even Ministers are in the list of Scams. 

In past 3 Years lot of Scams comes in Lime light such as:-
Commonwealth scam, 2G scam, coal scam, fodder scam.

Coal scam hits very hard to every mining co. and ministers related with coal industries that tarnish Indian Image globally. 


2G scam rocked all telecom industry and foreign co.s who buy in Indian co.s were at the receiving end as they losses their licences to work in India. 

Falling Rs.:- 

Falling Rs. is hurting India a lot as import bill is rising and due to which Fiscal deficit is on the rise. Also falling Rs. will cause rising cost of Petrol, Diesel & consumable items which is causing high inflation with the result is that RBI will not cut Repo Rate which means interest rates will remain high and no co. will be do business in such environment whose whole business depends upon import and also customers will not buy in such high inflation and high interest rate market. If inflation kept at high then there will not be any room for RBI to cut interest rates so foreign will not keep their fingers crossed to wait for low interest rates. 

Policy Paralysis:- 

Govt. cleared some projects such FDI in Retail, FDI in Aviation but their policies are not clear to anyone. Due to which co.s like Walmart moves away from India and waits till 2014 elections as they are not certain whether other govt. will take back decision on FDI in Retail. 

Vodafone slapped with 11000 Cr tax notice although they won the case in SC but amendment in tax laws are made for tax collection and case is still pending. Why should any foreign co. will come in India when their is no clear policy on any of the issue?? With govt. change rules are changed every time. Even Indian Investors are not clear about Govt. policies.