Dutch financier FMO targets 9 pc annual growth in India AUM for 3 yrs, seeks policy consistency

Dutch development finance institution FMO is targeting a yearly growth of up to 9 per cent in its over Euro 700 million (about Rs 5,500 crore assets under management in India over the medium- term, but wants policy consistencies and removal of roadblocks.

The financial body, based in The Hague, sees India continuing to be the biggest receiver of its investments in the medium-term or the next three years, its chief executive Peter Van Mierlo told PTI.

FMO has been active in India for 11 years, and looks to support those who are unable to get finance, including debt and equity, from other channels, and looks specifically for social and climate impact before writing cheques.

"We expect our Indian AUM to grow 8-9 per cent in the medium-term and we will continue to look for opportunities in agriculture, clean energy and finance," he said.

However, he said that there are a lot of policy inconsistencies in India and there is a need for structural improvements in others.

He pointed out the change in foreign portfolio investment flows into non-convertible debenture issues by companies and said that capping external investments has impacted FMO's investing.

FMO has over two-third of its investments on the debt side and the regulation, which was introduced in April last year, is affecting its investments, Mierlo said, adding that it is engaged with RBI and the Finance Ministry over the same.

He said India has to do more for land holding records and intellectual property rights, and called them as major area of disappointments.

He said the body is taking up all its issues with the Dutch government and other agencies on a regular basis.

FMO has assets of over USD 10 billion (over Rs 71,000 crore) globally in investment operations spread across 70 countries, he said, adding that a majority of the focus is on emerging economies.

Despite the rise in Indian GDP, the contrasts presented by the inequalities which exist in the country makes FMO's work essential, Mierlo said.