The European Union (EU) has urged India to regain the confidence of foreign investors as many companies from the EU are keen to invest in India despite various problems.
“It is important for India to regain investors’ confidence. Many of our companies are large investors in China but they also want to invest in India, which is the other growth pole in Asia. So, many companies are present in India despite the problems,” said Joao Cravinho, Ambassador, Head of Delegation European Union in India.
“The prospect of growth is better in India. The market and prospects will be much bigger ten years from now. Among investors from EU, there is positive sense on India’s medium-to-long term future,” Mr. Cravinho added. He was addressing select journalists here on Tuesday.
He said the biggest concern among EU investors was the uncertainty under which they operated in India. “The uncertainty of the tax regime here is devastating. There is uncertainty with regard to licensing. These uncertainties really frighten the European investors. The time the courts take here to resolve disputes is a real deterrent for investment,” he added.
However, he said trade relationship between India and EU was on the rise, and the EU enjoyed a healthy relationship with India. In 2012 bilateral trade was estimated to be little less than 100 million euros, slightly less than 2011. But this year there are signs of improvement.
In 2012, foreign direct investment inflow from India into EU was a negative 0.7 billion euros while the FDI outflow from the EU to India was 6 billion euros.