West Bengal ranks among the most backward states, both in terms of the number of new companies registered and total foreign direct investment (FDI) attracted over the past few years, according to statistics compiled by two key Union Ministries.

According to statistics compiled by the Union Ministry of Commerce & Industry and the Union Ministry of Statistics & Programme Implementation, the statistics on new companies registered nationally over the last three years show a poor performance for West Bengal in this regard.

As per the Central statistics, during the last three years, a total of 5.25 lakh new companies got registered nationally, out of which West Bengal’s figure was just 25,008, which is 4.76 per cent of the national figure. The states far ahead of West Bengal on this count were Maharashtra, Uttar Pradesh, Karnataka, and Telangana, among others. On the contrary, figures show that 2,227 companies shifted their bases or registered offices from West Bengal to other states during the last five-year period from 2019 to 2024.

Out of the 2,227 companies, 39 are listed with the Mumbai Stock Exchange. Under Section 13(4) of the Companies Act, 2013, a corporate entity has the freedom to shift its registration from one office to another, and there are several reasons for this shifting. The most commonly perceived reasons for changes in the base of a company from one state to another are flexibility in operations, smooth management, the cost of company administration, and better infrastructure facilities. As per the Central statistics, even in terms of attracting foreign direct investment, West Bengal cuts a sorry picture.

During the last six years, from 2019 to 2025, West Bengal’s position among the major Indian states in attracting foreign direct investment had been ninth, with the figure standing at just $663 million, as against Maharashtra’s figure of $26,204 million. Maharashtra had been the top among all Indian states on this count.

For quite some time, the economic and industry observers have been critical of two policies which they think pose major hurdles towards attracting big-ticket investment, both in the manufacturing and in the services sector.

First, the land policy of the state government that absolutely nullifies state intervention in procuring land for industries is a hurdle for land procurement for big industries in the manufacturing sector, which requires a huge plot of land in one go, especially in a state like West Bengal with fragmented land holdings.

Secondly, the state government’s announced policy of not allowing special economic zone (SEZ) status to any new entrant is a disincentive for major investment in the services, especially in the IT and ITeS sectors.

-IANS

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The post Bleeding Investment: Over 2,200 Companies Exit West Bengal In Five Years, FDI Stagnates appeared first on The Commune.

While Tamil Nadu Chief Minister M.K. Stalin touts 19 new MoUs worth ₹7,618 crore, promising 11,516 jobs from his recent US tour, Maharashtra is making waves by procuring investments 16 times more worth ₹1,20,220 crore without any international trips. Stalin’s announcement is overshadowed by concerns over investment transparency and accountability, especially given Maharashtra’s recent success in attracting significant projects like Tower Semiconductor’s ₹83,947 crore venture.

Dravidianist Media Celebrating New TN Investments

The Dravidian factions and the ruling DMK’s mouthpieces have been celebrating Tamil Nadu Chief Minister M.K. Stalin’s announcement of 19 Memorandums of Understanding (MoUs) worth ₹7,618 crore, expected to create 11,516 jobs. Stalin made this announcement during a press conference upon his return to Chennai on 14 September 2024 after a 14-day tour of the US.

Chief Minister Stalin said that he engaged with representatives from well-known firms during his trip, including 18 from Fortune 500 companies. As a result of these meetings, 19 Memorandums of Understanding (MoUs) were signed—eight in San Francisco and eleven in Chicago. These agreements are anticipated to create 11,516 jobs and will lead to developments in Tiruchy, Madurai, Coimbatore, Krishnagiri, Chennai, and Kancheepuram.

However, it’s worth noting that the DMK has yet to address the opposition’s calls for a white paper on the disclosures from previous investments attracted by Stalin. Before his recent US visit, Stalin had claimed that disclosing such details was not customary. However, upon his return and after being questioned again about the investments made during his trip, he altered his stance. Stalin asserted that the DMK has been transparent for the past three years and that the figures are already publicly available, but not without a twist here. Stalin pointed out that, based on evidence, less than 10% of the investments promised during ‘Edappadi‘ K. Palaniswami’s tenure as Chief Minister materialized. He chose not to elaborate further to avoid causing embarrassment.

What is troubling is that while the Dravidian parties blame each other, the state seems to be struggling to attract investments because Maharashtra, which already led in Foreign Direct Investment (FDI) inflows in 2023, has further bolstered its appeal as an investment destination without any ministerial visits to the US.

Maharastra

On 5 September 2024, Maharashtra’s Deputy Chief Minister Devendra Fadnavis announced a major development for the state, revealing that a total of ₹1,20,220 crore in investments had been approved in a Cabinet Sub Committee Meeting with Chief Minister Eknath Shinde. The approved investments include several significant projects that too without sending any delegations to foreign countries. Tower Semiconductor, in collaboration with the Adani Group, will set up operations at Taloja MIDC in Panvel with a total investment of ₹83,947 crore (10 billion USD). This project, which focuses on analog and mixed-signal semiconductor manufacturing, will have a phased approach—₹58,763 crore for Phase 1 and ₹25,184 crore for Phase 2—ultimately reaching a capacity of 80,000 wafers per month and creating over 5,000 jobs. Additionally, Skoda Volkswagen is investing ₹15,000 crore in electric and hybrid cars at Chakan, Pune, generating over 1,000 jobs. Toyota Kirloskar is also making a substantial investment of ₹21,273 crore at AURIC, Chhatrapati Sambhajinagar, to produce hybrid vehicles, plug-in hybrid vehicles, fuel cell electric vehicles, and battery electric vehicles, which will result in more than 8,800 jobs.

One more BIG news for Maharashtra !
Huge investments of total
₹ 1,20,220 crore approved in today’s Cabinet Sub-Committee Meeting, with CM Eknath Shinde ji !

The detailed list of approved investments is as follows:

Tower Semiconductor with Adani Group at Taloja MIDC, Panvel… pic.twitter.com/DVI9z94WyU

— Devendra Fadnavis (@Dev_Fadnavis) September 5, 2024

To enhance Tamil Nadu’s ability to attract investments, the state government should prioritize greater transparency by releasing a comprehensive white paper on both past and recent investments, which would help address public concerns and build trust. Showcasing successful outcomes from previous projects can also demonstrate tangible benefits and appeal to potential investors.

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The post Dravidian Model Vs Indian Model: Stalin Gets ₹7,618 Cr Investment To TN After 14 Day US Tour, MH CM Gets ₹1,20,220 Cr Investments Without Foreign Trips appeared first on The Commune.

COVID-19 has drastically affected the investment climate in all economies of the world, causing a sharp decline in the demand and supply equilibrium everywhere. India has been no exception to this unprecedented economic shock.

However, propagandists masquerading as economists and public policy experts have been taking to the columns of top international media like New York Times, Washington Post, Wall Street etc., to paint a negative picture about India.

But their propaganda has been punctured with the recent numbers of Foreign Portfolio Investments (FPI), Foreign Direct Investment (FDI) and Corporate Bond Market.

These numbers indicate that the investment sentiment in the Indian economy has been buoyed by the frequent and active intervention of the Government of India despite being hit by a world-wide pandemic. The trends in FPI, FDI and Corporate Bond Market flows underline the beliefs of investors in the strength and resilience of Indian economy.

In the last two months (October and November 2020), FPI inflows have witnessed a significant resurgence which has primarily been by equity inflows resulting in the highest ever FPI inflows for a month for India. As of 28th November 2020, FPI inflows stood at ₹62,782 crore. Of this, equity inflows amounted to ₹60,358 crore while FPI net investment in debt and hybrid was to the tune of ₹2,424 crore. The highest inflow in total FPI investment was witnessed on 12th November, marking a single day peak of ₹11,056 crore.

In the equities segment, the inflows in November 2020 is the highest amount of money invested ever since FPI data has been made available by the National Securities Depository Ltd.

FPI flows are known to be less resilient and more sensitive to changing market conditions. Investment through the FPI route are therefore gauged through the metric of net inflow and outflow. In October and November 2020, India saw large inflows through FPIs.

With respect to FDIs inflows into India during the second quarter of financial year 2020-21 (July, 2020 to September, 2020) have been US$ 28,102 million, out of which FDI equity inflows were US$ 23,441 million or ₹174,793 crore. This takes the FDI equity inflows during the financial year 2020-21upto September 2020 to US$30,004 million which is 15% more than the corresponding period of 2019-20. In rupee terms, the FDI Equity inflows of ₹224,613 crore are 23% more than the last year. August, 2020 has been the significant month when US$ 17,487 Million FDI equity inflows were reported in the country. Both FDI equity inflows and total FDI inflows into India have shown a secular rise over the years, with 2019-20 the year with the highest FDI in the last six years. The measures taken by the government on the fronts of FDI policy reforms, investment facilitation and ease of doing business have resulted in increased FDI inflows into the country.

Total FDI Flows (US$ Million)

The post Trends in FPI, FDI and Corporate Bond Market deflates rhetoric peddled by propagandists, India’s growth story continues appeared first on The Commune.