A presentation of EEB, reasons why we think FDI is good for INDIA, and planning Model of INDIA

1. PLANNING MODEL
AND
LIBERALISATION
PRIVATISATION
GLOBALISATION
MODEL
INDIA
Presented By: Pankaj Jain, Naketa Aggarwal, Jatin Gupta, Umesh Soni, Ravinder Sandhu
FA-1 (2010-2012) IIPM, Chandigarh

2. LPG
New Economic Policy of 1991 / Economic Reforms of 1991
Post Independence 1960’s – 1980’s 1990 onwards
1950’s
Government Control Economic Reforms
Adopted Socialism
brought in by then
Green Revolution P.M, Mr. P.V
Government Sector
Narsimha Rao and
then Finance
Increase in Exports
Minister Mr.
Manmohan Singh
Agriculture
Business Regulation

3. 1. LIBERALISATION INDUSTRIAL POLICY 1991
2. PRIVATISATION DISINVESTMENT
(50%-51% Transfer)
3. GLOBALISATION INTERNATIONAL TRADE
(Export & Import of goods)
INTERNATIONAL INTERNATIONAL
FINANCE MIGRATION
(FDI’s , FII’s) (International
students, Skilled workers
etc.)

4. FDI - is Foreign Direct Investments i.e. a foreign company
having a stake in a public sector undertaking in a country for
a long period and that company is called Multinational
Enterprise.
FII - is Foreign Institutional Investors, i.e, foreign Investment Bankers
like Goldman sachs, Merrill lynch, Lehman bros etc...investing in
indian markets......in other words buying indian stocks.....FII's
generally buy in large volumes which has an impact on the stock
markets...

5. Why FDI ?
Gain a foothold in a new
geographic market.
Increase a firm’s global
competitiveness and positioning.
Fill gaps in a company’s product
lines in a global industry.
Reduce costs in areas such as
R&D, production, and distribution.

6. Types of FDI Entry
Purchase of
New
existing Prior
investment Automatic
assets Permission
Route (FIPB)
Participation in
an international
joint-venture
6

7. Why INDIA
Second largestnaturalof software developers after the U.S.
Abundance of group resources
Has 6,500 companies on the at 300 million Exchange (only the NYSE has
lists a middle class estimated Bombay Stock out of a total population of 1
billion
more)
Destination forlargest economy & second largest pharmaceutical industry
World's fourth business process outsourcing, Knowledge processing etc.
Second largest English-speaking, scientific,8%
Growth over the past few years averaging technical and executive manpower
Low costs & Tax exemptions in SEZ Stability
Liberal, largest democracy, Political
Tax incentives for IT , business process outsourcing and KPO companies
Second largest emerging market (US$ 2.4 trillion)
Skilled and competitive labors force& D facilities in India
100 Fortune 500 companies have R
Highest rates of return on investment

8. FDI Investment Sectors
 Cigar and cigarettes of tobacco
 I.T
 Coal, Roads & Highways
 Oil & Energy
 Diamond, Gold, Silver , Minerals
 Power sector
 Atomic minerals
 Pharmaceuticals &
 Electricity Chemicals
 Hotel, hospitals
 Atomic energy
 Real state
 Arms and ammunition
 Mining
 Lottery business
 Mobile Sector
 Betting and Gambling
 Automobile
 Aircraft and warships
 Telecommunication

9. Major Investments
Companies Sector Investment
Wal mart,Marks Retail US$ 10 Billion
Intel Corp. I.T US$ 40 Billion
British & cairn Oil & Energy US$ 2 Billion
Essar power Power sector US$ 2 Billion
Toyota Automobile US$ 10.51 Billion
Panasonic Telecommunication US$ 200 million

10. “An institution established outside
India, which invests in securities traded on the
markets in India”
Investments made by residents of a country in
financial assets and production processes of
another country
Institutions like pension funds ,mutual funds,
investment trusts, asset management
companies,
nominees companies and incorporated
portfolio
managers

11. Where they can…
Under securities such as shares, debentures
and warrants issued by Indian companies
which are listed /to be listed on the Stock
exchange in India
The schemes floated by domestic mutual
funds, traded on the primary and secondary
markets.
In government securities including treasury
bills and debt securities of Indian companies.

12. ADVANTAGES OF FDI
Increase in Domestic Employment/Drop in Increased Productive efficiency
unemployment due to competition from
multinational subsidiaries
Investment in Needed Infrastructure.
Increase in Exports
Positive Influence on the Balance of
Payments. Increase in savings and
Investment
New Technology and “Know How” Transfer.
Faster growth of output and
Increased Capital Investment. employment
Targeted Regional and Sectoral Consumer Benefits
Development.

13. INTERNATIONAL MIGRATION

14. IIT is one of the most respected institutions in
the world for engineering. But last year they only
admitted 3500 new students, and 350,000
applied! What are the unlucky 346,500 students
going to do?
Lack of facilities
Reservation System
Cultural Experience
Superiority Complex
Value of the education higher abroad
Liberal Arts
Career opportunities

15. 2004-'05 -----------------------15,000
2005-’06------------------------16,227
China-----------------67,723
2006-’07------------------------20,000
South Korea -------62,392
2007-’08------------------------23,500
Japan ----------------35,282
2008-’09------------------------27,000
Taiwan ----------------20,094
2009-’10------------------------32,000

16. business and
management
(22%),
engineering
humanities (2%)
(19%)
mathematics
Agriculture(2%) and computer
science (9%)
intensive English physical and life
language (5%) sciences (9%))
health social sciences
professions (5%) (9%)
fine & applied
arts (5%),

17. 34% of
Microsoft
employees
13% of 38% of
XEROX doctors in
employees USA
Indians
17% of 12%
INTEL scientists
scientists in USA
28% of 36% of
IBM NASA
employees scientists

18. Country: India
Capital : New Delhi
Largest City: Mumbai
Official Language:
Hindi, English
President: Pratibha Patil
Prime Minister: Manmohan
Singh
Area: 3,287,263 sq. km
Population: 1,210,193,422
Density: 366.7/sq.km
GDP:
Total: $4.469Trilliion
Per Capita: $3,703
HDI: 0.547
Currency: Indian Rupee
Calling code: 91

20. $ rate effect on india
Monetatry policy
Recession
Euro crisis effect on india
Deflation
Reflation
FDI ad and disad.