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The global Indian phenomenon

V. Jayanth

More opportunities for investment

— FILE PHOTO

CATERING TO INDIANS: Kosher, a chain of Indian restaurants in Manhattan, New York.

CHENNAI: From the start of the liberalisation process in 1991, there has been no stopping of the Indians from going abroad, searching for more opportunities and looking at investment potential. Gradually, these openings and opportunities have increased and the Indians have made full use of them.

First there was the liberalisation in the release of foreign exchange for travel. So, the non-business travellers increased. The holidaying Indians went on a shopping spree wherever they could. It may have been just Sri Lanka or Singapore to begin with, but the ambit grew and the out-bound tourism industry recorded a phenomenal growth. Realising the Indians’ penchant for shopping, many countries opened up their visa regime and made it easier for the visitors from the sub continent to spend a few days in their countries.

This led to the growth in the travel and tourist trade, and the introduction of attractive packages. The era of ‘Visa-on-arrival’ began and many neighbouring countries offered an easy visa on arrival regime for Indians.

From the near-by South and South East Asian destinations, India’s burgeoning middle and upper middle class starting flying out to African, European and East Asian destinations. The U.S. was always on their list because of the ready availability of hosts and sponsors there.

Very soon, countries like Malaysia realised that it was not in their own interests to keep out the Indians — notwithstanding their conservative Immigration and visa procedures. Transit visas, limited days tourist visas and a visa on arrival became the order of the day. All these countries were quick to find out that Indians were the best shoppers — per capita expenditure and shopping was highest among the Indian tourists, Singapore, Malaysia and Sri Lanka reported. And this gradually spread to other destinations.

With the introduction of more airlines and low fares, travel abroad has become so much cheaper and accessible to a vast multitude of Indians today. After travel and shopping, it was investments abroad. Initially, it was left to companies to invest abroad, and to float papers to raise funds overseas. Now, there has been a spate of takeovers by leading Indian companies, which have gone global and emerged as multinational companies in their own right.

Most of them have looked for consolidation in their sector — be it steel, other metals and minerals, or even tea.

The latest offer from the liberalised environment has been the right to buy and own property abroad - at least in countries that permit foreign nationals to own such property. Given the overheated real estate sector in the country, it appears quite likely that a segment of Indians will plump for this opportunity to own apartments abroad — making it easy for them to enjoy their annual vacations. As G. Swaminathan, an investment banker says:

“Like owning beach resorts or farm houses, I am sure a good many Indians will now cash in on this opportunity to buy up apartments abroad. We know of a lot many people who own timeshare apartments abroad and rotate it for their annual holidays.”

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