The Hindu Business Line : Call to accelerate investment flows from EU

Hyderabad, July 24 If the foreign direct investment (FDI) into the country was $15.72 billion during the financial year 2006-07, the contribution of the European Union (EU) countries was a minuscule 0.2 per cent.

Even this came from a handful of countries such as the UK, Germany, France, the Netherlands, Italy and Sweden. The reasons for low EU interest is due to quality inconsistency of Indian products, infringement fears on IPR (Intellectual Property Rights), procedural delays and lack of transparency.

There is need and a big potential for an accelerated growth of FDI from EU countries in the near future, a meeting of the EU-India Trade and Investment here has felt.

To make this happen, a joint programme of the EU and India called the IFD (EU-Investment Facilitation Desk) has created a two-year initiative with about €13.35-million fund. It is making efforts to expand the presence of EU countries in India and focus on small and medium enterprises (SMEs).

About 70-75 per cent enquiries on investments prospects have been coming from SMEs. Also, the major concerns of EU countries are being addressed, said Mr A. Sahasranamam, Advisor to the Union Ministry of Commerce for the joint programme.

Speaking at a meeting on ‘Opportunities for EU-India Trade and Investment with special focus on the Federal State of Schleswig and Holstein, FRG’, here today, he said the IFD was in the process of setting up a few quality testing labs that meet the EU and global standards. The equipment would arrive shortly and would become functional and help Indian exporters.

Dr Dietrich Kebschull, Chief Programme Coordinator of the EU-India programme, said “India has to look for more FDI. The exports, which were $120 billion, need to go up substantially and the EU countries definitely offer good scope, once their concerns are addressed”.

Mr Norbert Goss, Head of Investment Promotion of the Federal State of Schleswig-Holstein (one of the States in Germany), spoke about the investment opportunities in the region. Several industry representatives from the State participated in the meeting.

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