India to relax clearance condition for cross-border investment

Investors of both countries interested.


Kashif Hussain August 01, 2011

KARACHI:


Indian ministry of trade has given assurance that it will soften the condition of clearance from Reserve Bank of India (RBI) for cross-border investment in Pakistan.


According to the Indian law, its investors are required to obtain permission from RBI for investment and joint venture projects in Pakistan.

Investors of both the countries are keenly interested in investment and transfer of technology in various sectors. They have been engaged in initial talks for cross-border investment in both the countries but these are progressing at a snail’s pace because of difficulties in acquiring permission from RBI, the Indian central bank.

However, the recent assurance to Pakistani investors by the Indian trade ministry has revived prospects of joint projects in the two countries.

International Multi Group Chairman Sheikh Amjad Rashid, who is interested in joint investment projects with the Indian private sector in automobile and entertainment industries, told The Express Tribune that he met with Indian minister and joint secretary of trade during his visit to Delhi in mid-July and asked them to relax the condition of taking RBI permission for making investment. “In return, I was assured that joint investment projects by Pakistani and Indian businessmen will be considered on case-to-case basis and all possible facilities will be provided for investment in India.”

After returning from the trip, Rashid briefed Commerce Secretary Zafar Mehmood about the Indian offer, who expressed hope that India would also support the European Union’s concessional trade package in the World Trade Organisation (WTO).

Mehmood said Pakistan had placed no restrictions on cross-border investment with India, adding such investments would contribute to bringing economic stability in the region. Rashid said a proposal based on joint equity investment had been sent to the Indian trade ministry, adding since investors of both sides would invest equal amounts in each other’s country, the investment of private sector would remain secure in unfavourable circumstances as well.

He said joint investment would pave the way for transfer of technology and save the high cost incurred on bringing technology from Europe.

Rashid’s group is investing in an edible oil refinery in Karachi for which all machinery is being imported from Europe and this can be brought from India if conditions remain conducive. The group is also interested in manufacturing cheap Nano cars in cooperation with Tata Motors, which will encourage investment of $10 million.





Published in The Express Tribune, August 2nd, 2011.

COMMENTS (13)

Hedgefunder | 10 years ago | Reply @Raj: well rest assure, as i was actually there in Pakistan early this year with CBI oganised British Trade Delegation for four day visit, and i can assure you there is serious lack of facilities in major urban cities, i am not talking about rural areas !! one only has to view Karachi at present in terms of security and power shortages etc to realise the facts !!!!! What the Pakistanis, don't understand is the fact that Money has its own language, denials and refusal to face facts !! 2 + 2 can only be 4 and not they would like it to be !!!!
Raj | 10 years ago | Reply

@Hedgefunder : I am not going to oppose your points. But then I have read blogs of Pakistanis who came to India and opined that India is lacking behind Pakistan in many aspects like Roads, Infrastructure , clean transport, clean environment , social and financial affluence and security - number of poor people in India are more (by percentage as well as grand total). Now both yours and theirs opinion may be subjective or neutral. But then how will common people know about that.

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