foreign investment

NSEL signs MoU with Belarusian Universal
• National Spot Exchange Ltd. (NSEL) has signed a MoU with Belarusian Universal Commodity Exchange
(BUCE) to allow Indian producers to explore the possibility of exporting their produce to Eastern
European countries through BUCE’s network.
• BUCE has members in 56 countries and more than 12,000 companies were connected with their network,
this MoU would provide marketing support to Indian exporters and importers
• This will create a significant value addition for Indian importers and exporters to execute bilateral deals
through Spot Exchange platform.








India initiates to instill more transparency in foreign aid
Indian has initiated a number of steps, including the establishment of a central aid agency, to bring greater
transparency and swiftness in delivery structures. In the last 4-5 years India has emerged as one of the big donors
among developing countries to less developed and smaller countries. But allegations of lethargic delivery and fund
diversion have been made from many sides. To overcome this situation India has taken some key initiatives. Setting up
of Development Partnership Administration (DPA) is one among those positive moves.
 DPA is a department of the External Affairs Ministry,
 Headed by P.S. Raghavan (additional secretary in the External Affairs ministry)
 Department aims at augmenting India’s soft power and economic diplomacy through swifter aid delivery.
 Provides structural framework for dispensing and channelizing aid
 Currently consists of around 20 officials including professionals from different countries
 It integrates all aspects related to project implementation, ranging from monitoring implementation and auditing
impact assessment
 Specialists from other ministries, including the railways, telecommunications, agriculture and human resource
development, are being incorporated into it.
 Experts also join from outside the government as consultants on a project-to-project basis.
Current Affairs Published on www.gktoday.in from January 1, 2012 to
September 10, 2012
With China’s expanding its diplomatic reach in the developing world, India has also expanded aid and soft loans of over
US$11 billion to developing countries as a mean to further India’s strategic interests through economic diplomacy and
soft power projection








Govt to establish Investment Tracking System
An Investment Tracking System (ITS) has been approved to ensure speedy execution of major investment projects
getting delayed for a number of reasons.It has been decided that major projects will be specially tracked to implement
them faster to give a thrust to the economy.The decision has come at a time when projects are getting delayed on
multiple fronts - environmental clearances, security clearances, other clearances, land related matters etc.
Under Investment Tracking System:
Current Affairs Published on www.gktoday.in from January 1, 2012 to
September 10, 2012
 National Manufacturing Competitiveness Council (NMCC) will track all Public Sector projects with an investment
of Rs 1000 crore and above
 NMCC will submit a quarterly statement of all projects examined and any issues identified that seek resolution
 Department of Financial Services will watch projects with an investment of Rs 1000 crore and above in the
private sector. The department may also use data available with the banking sector for this purpose

Navis acquires full ownership of Indian fast-food
Chain “Nirula’s”
After buying out Nirula’s’ co-owner Samir Kuckreja’s stake, Malaysia-based private equity Navis Capital
Partners has taken complete control of homegrown fast food chain Nirula’s.
Nirula’s:
 Among the first fast-food chains in India which made ‘big boy burgers’ and ‘hot chocolate fudge’ famous.
 It also pioneered the concept of family-style restaurant when it opened its first outlet in Delhi in 1934.
 With sales estimated at Rs. 100 crore, the 77-year-old Nirula’s operates largely on the franchisee structure,
mainly in the Northern states.
 The chain’s 80-odd stores include dine-in restaurants, pastry shops, ice-cream parlours, hotels and coffee shops.
 Navis bought Nirula’s for close to 90 crore in 2006. Post-acquisition, it invested Rs. 30 crore directly, while
another Rs. 20 crore was infused by the franchisees for store rollouts, equipment and kitchens.
Why Naruala’s could not could not capitalize on its first mover advantage in India?
 Over the years, Narula’s could not capitalize on its first-mover advantage and began losing ground to
multinational fast food chains such as Yum Foods’ Pizza Hut and McDonald’s, which started investing heavily in
India.
As per a white paper by the National Restaurant Association of India, the restaurant industry is estimated at Rs 7000-
8500 crore with organized players accounting for a meagre 2-3% of the overall business.

FDI surges by 36% during January-October

 FDI in India has surged by 36 per cent to 23.68 billion US dollars during the January-October period last year.

During January-October 2010, the country had attracted FDI worth 17.36 billion US Dollars.

 As per the latest data from Ministry of Commerce & Industry, the sectors that attracted maximum FDI during the

nine-month period, include financial and non-financial services, telecom, housing, real estate & construction and

power.

 Mauritius, Singapore, US, UK, Netherlands, Japan, Germany and UAE are the major sources of investment in

India.

Government to allow QFIs to invest in India
 The Government has started the New Year with an important policy change by deciding to allow the Qualified
Foreign Investors to invest in Indian equity markets.
 The Qualified Foreign Investor is an individual or group or association resident in a foreign country that is
compliant with Financial Action Task Force standards of the government of India. QFIs do not include Foreign
Institutional Investors or sub accounts.
 The objective of this policy change is to broaden the class of investors investing in India, attract more foreign
funds and reduce market volatility and deepen the capital market. The move was expected as there was a
significant foreign capital outflows from the domestic equity market in recent times, leading to volatility in
Rupee.

RBI elevates foreign investment limit in govt bonds

In a move targeted at preventing the continuous decline of Rupee, the Reserve Bank of India increased the limit of foreign investment in government bonds by $ 5 billion to $ 20 billion. The regulator also elevated limit of external commercial borrowing (ECB) to $ 10 bilion.

Currently, foreign institutional investors (FIIs) are permitted to invest upto $ 20 billion in Indian corporate bonds. While the limit in government bonds is at $ 15 billion, FIIs are not allowed to invest in infrastructure bonds upto $ 25 billion. The RBI also curtailed the time period for the maturity of government securities (g-secs) to 3years from earlier 5 years.



Coca-Cola Company announced that it would invest $5
billion in the country between 2012 and 2020.