"It was a great shot in the arm," is what Ron Somers, president, US India Business Council believes of the Indian finance minister, P Chidambaram's visit to New York. Chidambaram was on a road show in the United States wooing investors to boost capital flows in India.
Somers, in an interview to CNBC-TV18 said the visit was badly needed and Chidambaram gave very welcome signals to investors. Considering the weak global economic recovery and Europe, specifically, it is more important than ever for the United States and India to work with cooperation, added Somers.
Stressing on India as an investment option Somers said, "Each and everyone of the companies that were in the room with the finance minister, wants to be a big investor, even a greater investor in India in terms of volumes and amounts of money."
Below is the edited transcript of Somers interview to CNBC-TV18.
Q: Let me start by asking you about the finance minister's visit that was organised by you. What was the key take away from that? Are you now more convinced about the macro stability, investment scenario, regulatory and tax concerns that were raised earlier? Are you more convinced about the India story?
A: The finance minister’s visit to New York city for US India Business Council was a great shot in the arm and one that was badly needed. The sense that we are getting is that the global economic recovery, and I’m referring to Europe specifically, is not coming along as well as all of us would hope. Therefore, it is more important than ever for the United States and India to be working cooperatively together on commercial issues, on business and creating jobs and opportunities. Chidambaram made that point very clearly and that was a welcome signal to investors.
Q: Do you think strategic money, foreign direct investment (FDI) flow will increase into India because while foreign institutional investors (FII) flows were coming in, strategic money was on the sidelines waiting for clarity on tax, on regulations, on whether the economy is going to grow or not, do you believe US investors will put money into India?
A: Every investor that spoke with the finance minister wants to be investing more. Infact, the meeting began with an appreciation for the fact that we would not all be together if we all didn’t want to achieve a positive mutual outcome. And this is in the sense that each and everyone of the companies that were in the room with the finance minister, wants to be a big investor, even a greater investor in India in terms of volumes and amounts of money.
In terms of lack of clarity, the finance minister has been the most articulate about providing such clarity and he did so at every stop that he made that we were involved in.
Q: There are any specific concerns though raised with regards to the political climate? There is a possibility of an early election. Was political stability discussed at that meeting?
A: It was my first question to the finance minister in the presence of the Fortune 100 companies to describe for the companies the upcoming national elections schedule for May 2014. With a population of 1.2 billion with typically 65 percent voter turnout in election conducted over five different phases with officers moving around the country to make certain that the polls will be fair and executed with fairness, this is an extraordinary democratic undertaking and one that we should commend and actually celebrate.
The finance minister was very clear that he believes that the government will last its full five years, meaning that it will go all the way to a conclusion into the May 2014 timeframe. He had a very robust agenda between now and that period in parliament as well as few executive orders to continue to advance the economic reform process.
He gave everyone confidence that the government is on the move to bring economic reforms to the fructification that everyone hopes for. Our companies are actually very bullish about seeing this process unfold and the elections are expected just like every country has elections. So, we are looking forward to working with India through this process and making certain that investment flows don’t hesitate.