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| India second favourite investment destination among Japanese firms |
| BS Reporter / New Delhi Mar 20, 2009, 01:01 IST |
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India remains the second favourite investment destination for Japanese companies, a survey by the Japan Bank of International Cooperation (JBIC) has revealed.
About 58 per cent of the 620 companies surveyed said they found India a promising investment destination, compared with 50 per cent in last year’s survey. The report observed that though China retained the top position, its percentage share decreased to 63 per cent from 68 per cent.
According to the data available with JBIC, a financial institution based on that country’s external economic policy, Japanese FDI into India tripled to $5.4 billion in 2008 from $1.78 billion in the previous year.
The increase in Japanese investment comes when India is expected to miss the FDI target of $30 billion for 2008-09, as many foreign companies have postponed or cancelled their plans in the backdrop of the ongoing economic crisis.
The key reason for the increasing momentum of Japanese investments in India is the growth potential of the local market. Moreover, cheap labour and qualified human resources also contributed to large investment flows to India. However, the surveyed companies identified poor infrastructure as a hindrance to investment.
A JBIC release said that 108 companies had concrete plans to enter the Indian market in 2008, as against 89 in the previous year.
Japanese automobile and general machinery companies were the most interested in India as an investment destination. But the attractiveness of food processing and textile sector dropped in the latest survey.
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