Modi's India No 1 in world in ensuring foreign investors take profits back home, amass wealth: US survey
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| Daniel Altman |
In a clear effort to provide boost to Prime Minister Narendra Modi, a top US journal has called India as the most important investment destination in the world. The latest rating provided by the high-profile Foreign Policy magazine, which is owned by the FP Group, a division of Graham Holdings Company, formerly the Washington Post Company, has “the big story in the Baseline Profitability Index (BPI) this year is India. coming out on top.”
Seeking to provide full marks to India, the report says, the country's “growth forecasts are up, perceptions of corruption down, and investors better protected following the election of a government led by Prime Minister Narendra Modi.” The ultimate aim of the report is show which country can ensure the investors are able to get returns to their profits back to their “pockets”.
A one-man job, the report has been prepared by Daniel Altman, who is senior editor, economics at the “Foreign Policy” magazine, and is an adjunct professor at New York University's Stern School of Business.
The high-profile report finds India's BPI at 1.32, placing it at No 1, followed by Quatar at No 2 with a BPI of 1..28, Botswana at No 3 with a BPI 1.27, Singapore at No 4 with a BPI of 1.22, and Ghana at No 5 with a BPI of 1.21. The United States, the report says, has a BPI of 1.01 with a ranking of No 50, the United Kingdom a BPI of 1.00 with a ranking of No 64, China a BPI of 0.99 with a ranking of No 65, and Japan a BPI of 0.98 with a ranking of No 74.
Upbeat, Amitabh Kant, secretary, Department of Industrial Policy and Promotion (DIPP), Government of India, forming part of the Modi team visiting the US, has tweeted, “India is attracting #FDI like never before. 1 year of #MakeInIndia”, adding, “As the lion turns 1 today, we take a look at some of the notable investments since #MakeInIndia's launch!”
The report says, India was placed No 6 in 2014, again way ahead of the US which was on the 26th position, United Kingdom 7th position, China at 50th position and Japan at 60th position.
Pointing towards the methodology, the report says, there are three which will affect the ultimate success of foreign investment: “How much an asset's value grows, the preservation of that value while the asset is owned, and the ease of bringing home the proceeds from selling the asset.”
The report adds, “Each of these groups of factors requires a different kind of assessment. It's not enough to worry only about rates of return, corruption, political stability, investor protection, or exchange rates alone. The BPI combines these factors into a summary statistic that conveys a country's basic attractiveness for investment.”
Wondering “Where exactly should they put their money”, the report says, “Modi’s India is the place to start”, adding, “It’s a great time to be an international investor. Most countries crippled by the global financial crisis now have their banking systems and fiscal balances under control, and demand for goods and services is returning almost everywhere. And with more economies than ever integrated into global markets, investors have their pick of destinations.”
The report says that India is “up”, and America is “down”, with Venezuela being at the “the rear”. Pointing out that there is a need for investors to “worry about things like financial stability, physical security, corruption, expropriation by government, exploitation by local partners, capital controls, and exchange rates”, it tells top investors, “These factors together gives a better idea of how big the return will be when it finally reaches your pocket.”
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