The Hindu : PM lifts ceiling on overseas investments

Online edition of India's National Newspaper
Saturday, Jan 10, 2004

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PM lifts ceiling on overseas investments

By Our Special Correspondent

The Prime Minister, Atal Bihari Vajpayee, presenting the Pravasi Bharatiya Samman to the President of Guyana, Bharat Jagdeo, during the ``Pravasi Bharatiya Divas'' in New Delhi on Friday. — Photo: Kamal Narang

NEW DELHI, JAN. 9. Comfortable with the more than $100 billion foreign exchange reserves, the Prime Minister, Atal Bihari Vajpayee, today utilised the second Pravasi Bhartiya Divas conference here to announce more facilities for the corporate sector to invest abroad. This, he said, was to encourage the phenomenon of the Indian corporates emerging as global players with impressive investments overseas and acquisition of companies abroad.

The Indian corporates will, hereafter, be freely permitted to make overseas investments up to 100 per cent of their net worth, either through an overseas joint venture or a wholly-owned subsidiary. So far, corporate investments abroad were restricted to 25 per cent of their net worth along with other restrictions. These restrictions, including a ceiling of $100 million on overseas investment, have been lifted.

Another facility extended to Indian industrialists is to go global in the agriculture sector. Accordingly, the existing restrictions on Indian corporates to undertake agricultural activities abroad, whether directly or through an overseas branch, would be removed. "This will enable Indian companies to take advantage of global opportunities and also acquire technological and other skills for adoption in India," the Prime Minister said.

For the second Pravasi Bhartiya Divas conference, representatives of `Bharatvanshis' from 61 countries have converged here to celebrate "the commonwealth of kinship."

Addressing the delegates, a majority of whom constitute Persons of Indian Origin (PIO) and Non-Resident Indians (NRIs), Mr. Vajpayee dwelt on the good tidings in the Indian economy to announce that "together, we constitute the global Indian family. Together, we are announcing the arrival on the world stage of a Shining India, an India that has resolved to regain her past glory and indeed surpass it, an India that will both be an economic powerhouse and a major contributor to humanity's all-sided evolution to a higher level."

Eager to extend the "feel good" wrap to the PIOs and NRIs, the Prime Minister said Indian workers in the Gulf and South East Asia who leave their children behind in India will now "enjoy 1/3rd reservation out of the 15 per cent supernumerary seats across different disciplines in educational institutions." Further, children of Gulf NRIs would now pay the same fees as resident citizens.

Referring to the oft-repeated demand of PIOs/NRIs for a permanent centre in India to deal with the various needs of the Indian Diaspora, Mr. Vajpayee said the Government had decided to set up a Pravasi Bharatiya Kendra in the capital for which land and a seed grant of Rs. 25 crores would be provided.

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