[Dec 2007, Volume 4 Quarterly Issue] Pdf File size - The IIPM Think ...
[Dec 2007, Volume 4 Quarterly Issue] Pdf File size - The IIPM Think ...
[Dec 2007, Volume 4 Quarterly Issue] Pdf File size - The IIPM Think ...
You also want an ePaper? Increase the reach of your titles
YUMPU automatically turns print PDFs into web optimized ePapers that Google loves.
MORE MARKETS, LESS GOVERNMENT<br />
servers [see, for instance, Kumar (1995)<br />
& Pradhan (<strong>2007</strong>) 15 ] that the bulk of<br />
India’s outward FDI during 1970s and<br />
1980s was in the manufacturing sector,<br />
primarily in light engineering, pharmaceuticals,<br />
chemicals and textiles. Along<br />
with the increasing geographical diversification<br />
of outward FDI from the<br />
country, a sectoral diversification (towards<br />
services) also started taking place<br />
in the early 1990s. Although in case of<br />
certain services like, communication<br />
and software, broadcasting and publishing,<br />
engineering and construction, and<br />
hotels and restaurants, outward FDI<br />
from India has been rising; manufacturing<br />
sector still accounts for a major<br />
chunk of total outward FDI from India.<br />
Table-2 presents the sectoral composition<br />
of outward FDI flows from India<br />
during the period from April 1999 to<br />
October 2006. In this period, the largest<br />
amount approved for overseas investment<br />
was in the manufacturing sector<br />
(at $11093 million) followed by non-financial<br />
services sector (including software<br />
development), trading sector and<br />
other activities (see Table-2). Over this<br />
A sizable chunk of Indian outward FDI has been<br />
going to the tax havens or offshore financial<br />
centres like Mauritius (10 percent), British Virgin<br />
Islands (4.5 percent), and Bermuda (3 percent)<br />
period, the share of manufacturing sector<br />
was 53 percent while that of non-financial<br />
services was 33 percent and that<br />
of trading was 5 percent. An almost<br />
similar pattern emerges for the period<br />
Table 1: Geographical Distribution Of Approved Outward FDI Flows From India<br />
(Top 15 Destinations)(Million $ )<br />
Rank Country April 1996 to<br />
March 2002<br />
2002-03 2003-04 2004-05 2005-06 2006-07 * Total Share<br />
(in%)<br />
1 Russia 1748.7 0.2 1.4 1076.2 1.2 3.0 2830.6 12.78<br />
2 USA 1540.8 185.3 207.1 251.4 270.3 313.4 2768.3 12.50<br />
3 Mauritius 618.3 133.4 175.6 149.4 332.7 741.4 2150.7 9.71<br />
4 U.K 410.6 34.5 138.5 71.9 158.3 1335.9 2149.6 9.71<br />
5 Netherlands 157.9 15.9 30.2 30.7 284.6 1005.5 1524.8 6.89<br />
6 Singapore 153.0 46.8 15.9 239.3 200.5 499.5 1154.9 5.22<br />
7 Sudan - 750.0 162.0 51.5 63.0 118.1 1144.7 5.17<br />
8 British Virgin Island 776.5 3.3 4.9 131.4 29.5 39.0 984.7 4.45<br />
9 Cyprus 1.9 - 0.0 1.9 13.4 701.6 718.8 3.25<br />
10 Hong Kong 445.1 14.8 16.2 73.6 88.8 41.5 679.9 3.07<br />
11 Bermuda 232.6 29.0 142.5 221.3 2.6 627.9 2.84<br />
12 UAE 110.2 12.6 32.1 41.9 141.0 205.3 543.0 2.45<br />
13 Australia 7.0 95.0 92.9 158.8 75.3 95.2 524.1 2.37<br />
14 Brazil 13.0 5.2 5.0 17.2 420.1 6.7 467.2 2.11<br />
15 Canada 5.6 2.3 0.7 0.8 3.5 397.8 410.7 1.85<br />
Total Outward Investment<br />
7543.1 1472.1 1450.9 2804.0 2859.1 6003.9 22142.9<br />
All Developed Countries<br />
(Share in%)<br />
All Developing<br />
Countries (Share in%)<br />
2608.8<br />
(35)<br />
4934.2<br />
(65)<br />
396.6<br />
(27)<br />
1075.5<br />
(73)<br />
774.0<br />
(53)<br />
676.9<br />
(47)<br />
799.6<br />
(29)<br />
2004.3<br />
(71)<br />
1015.4<br />
(36)<br />
1843.6<br />
(64)<br />
Source: Compiled from data given in the website of Department of Economic Affairs, Ministry of Finance, Government of India.<br />
Note: * April-October 2006.<br />
4073.9<br />
(68)<br />
1929.8<br />
(32)<br />
9668.4<br />
(44)<br />
12474.4<br />
(56)<br />
THE INDIA ECONOMY REVIEW<br />
111