“Obama not properly informed of our strong economic fundamentals”
Responding to U.S. President Barack Obama raising concerns over “deteriorating” investment climate in India, the government on Sunday said certain “international lobbies” were spreading such stories and he was not properly informed of the country’s strong economic fundamentals.
“Certain international lobbies like Vodafone are spreading this kind of a story and Mr. Obama was not properly informed of the things that are happening, particularly when India’s economic fundamentals are strong,” Corporate Affairs Minister Veerappa Moily told reporters in Bangalore when asked about Mr. Obama’s remarks.
Opposition parties lashed out at the U.S. President for his remarks that India prohibited foreign investment in too many sectors, with the BJP saying the country could not open its markets just because he wanted it.
“If Mr. Obama wants FDI in retail and India does not want, then it won’t come just because he is demanding it,” BJP leader Yashwant Sinha said in Delhi.
Mr. Moily said the perception of deteriorating investment climate in India was not based on economic parameters, but on certain impression of few individuals, entrepreneurs and investors.
“That is also being removed. Once that perception is removed, I think in 2-3 months, we are back again with a kick-start to pick up the same speed as we had done in the last decade,” he said.
Mr. Moily said there was no crisis in India, whereas the U.S. and other countries faced crisis, “not once but twice in 2008 and 2010.”
“Not even a single financial institution has collapsed in this country, whereas many such things have collapsed in the U.S. and other countries,” he said.
In the last one decade, India had registered a vibrant growth rate of 8 to 9.5 per cent, “but for the economic crisis in the U.S. and Europe, the country would have definitely crossed 10 per cent of the GDP.”
“That is the potential of India which can recover back immediately by taking remedial steps,” Mr. Moily said.
He said 55 per cent of the investment in the form of FIIs and FDI came from as many as 10 countries including Mauritius, Cyprus and Singapore, and only 19 per cent came from the U.S. and other countries.
“Ultimately Prime Minister Manmohan Singh is going to address all these problems and it is being considered. That’s why again the investment climate is picking up,” he said.
BJP Vice-President Mukhtar Abbas Naqvi termed the U.S. President’s remarks “laughable.”
“That country is giving us a certificate on investment and economy when it itself is facing economic problems. We have to ensure our national interests on our own. It is laughable,” he said.
CPI(M) leader Nilotpal Basu said: “They [The U.S.] want to open up our economy and market on their terms. For this purpose they are creating this pressure.”
The BJP and the Left have opposed the FDI, especially in retail, citing interests of the small trader.
The Samajwadi Party, which is extending outside support to the UPA, said India would not take a decision in support of the United States.
“They only want their market to expand in our country,” SP leader Shahid Siddique said.