JEDDAH, 14 April 2005 — Indian Finance Minister P. Chidambaram expressed hope yesterday that a bilateral investment protection agreement (BIPA) would be reached before the possible visit of Crown Prince Abdullah to India by the year-end.
“Even in the absence of such an agreement, no investment can be expropriated in India. We’ve a rule of law. Nobody can take away your investment. The rule of law guarantees that all your investments are absolutely safe,” he assured the business community at an interactive meeting hosted at the Jeddah Chamber of Commerce and Industry.
Mazen Batterjee, vice chairman of the JCCI, presided at the meeting which was jointly hosted by the JCCI and the Saudi Indian Business Network, which was represented by its President Abdul Khaliq Saeed, a leading Saudi businessman, and vice patron, Consul General Dr. Ausaf Sayeed. Chidambaram, who had a brief stopover here on his way from Riyadh to the US, said he renewed the invitation from Prime Minister Dr. Manmohan Singh to the crown prince during his visit to the capital for the Saudi-Indian Joint Commission (SIJC) meeting. He termed as successful the SIJC meeting, as well as his meetings with the crown prince, and the ministries of foreign affairs, and planning and economy.
“It’s an exciting story unfolding in India and I want Saudi Arabia to take advantage of the vast investment potential that exists,” he said.
Chidambaram reminded Saudi businessmen that India had an independent judicial system that held guarantees for investment. The country, which has a vibrant democracy and plural and tolerant society, also has well established Confederation of Indian Industry (CII) and Federation of Indian Chambers of Commerce and Industry (FICCI) that are run by hard-core professionals. They have their websites and can be accessed for information and data for forging business partnerships.
Today, Indian companies are so well established that they have been acquiring businesses abroad. “Name the sector and they are acquiring businesses worldwide, whether pharmaceutical, steel, automobile parts, banks, telecom, etc. They not only have been importing investment but now are exporting investment,” he said.
There are 68 Indian joint ventures in the Kingdom, while Saudi joint ventures in India number 45. “So there is unlimited scope for joint ventures bilaterally,” he said and urged Saudis to look toward India as a neighbor. “
He identified telecom, desalination, refineries, mining and infrastructural projects like roads, airports, and ports as among potential areas for overseas investment. “We had four telephones per 100 population. We’ve increased it to nine telephones per 100. We need to increase it to 45 telephones per 100, which means we need to increase it five times. This holds vast potential for investment in the next five to 10 years,” he said.
Under the public-private partnership model, thousands of kilometers of roads from north to south and east to west have to be built. Airports in Delhi and Bombay are to be given to the private sector for modernization. Bangalore and Hyderabad are to have new private airports, each costing between $1.5 billion to $2 billion. Madras and Calcutta airports will cost $1.5 billion to $2 billion each for modernization, he said listing the projects that need to attract investment.
Desalination plants especially hold tremendous scope for investment, he said and referred to the private sector desalination plants in Patalganga which Reliance Industries has established by using reverse osmosis technology.
The federal government intends to establish a major desalination plant in Madras and the (Tamil Nadu) state government has received bids for it. The valuation is under way and it will be finalized by July. The plant is to be established with federal government funds. “
Replying to questions from Saudi businessmen, Chidambaram said India did not make any distinction between Islamic banking and any other model of banking. “The bank is entitled to follow its own practices provided it subscribes to the regulatory and prudential norms laid down by the central bank — Reserve Bank of India.” He hinted that discussions were taking place to set up an institute of technology in the Kingdom in cooperation with the Indian Institute of Technology, which has its world-famous institutes countrywide. “India provides very good education. We welcome foreign students and your students are welcome.”
