Govt paints rosy picture to lure QFIs via global roadshows

Amidst prophecies of economic doom and relentless criticism of government inaction, the finance ministry is taking steps to correct the overseas perception of the Indian economy.

CNBC-TV18's Aakansha Sethi reports that officials from the finance and external affairs ministries, investment bankers and representatives from NSE and BSE are headed out on roadshows to present the right perspective of the Indian economy to investors across the globe. Also watch the accompanying video
India is in the headlines for all the wrong reasons - a slowing economy, persistent inflation, flight of capital and lack of decision-making. As foreign investors begin to question the very basis of India's economic potential, the government is attempting to correct the negative perception through a five-country tour in the Middle-East which is the only part of the globe that is flush with cash and hungry investors.
A team of close to a dozen officials led by economic affairs secretary R Gopalan will hit the global roadshow circuit from June 10 to hard-sell India as an incredible investment destination. 
The sales pitch focuses on recent policy measures like easier overseas borrowing norms, new takeover norms, alternate investment funds and allowing foreign individual investors or QFIs (qualified foreign investors) to invest in the equity markets and corporate bonds.
And while the Middle-East is the first destination, similar roadshows are to be held in the US, Europe and the Far East eventually. So will this effort help reverse sentiment and get foreigners interested again in India?
Kapil Seth, senior vice-president and head, HSBC Securities Services, "The market is seeing movement on the QFI route - to take feedback on record and make improvements in the market process through QFIs. The roadshows are sending out positive signs."
And anticipating tough questions on the fiscal condition of the government and the subsidy burden, the finance ministry is arming itself with data that will seek to reassure investors that the FY13 fiscal deficit will be kept at 5.1% of GDP.
The roadshows will also talk about the inherent strengths of the Indian economy, including increasing consumption of the large middle class. So, while this is a new attempt to convince the skeptics overseas, the question remains whether the political dispensation at the Centre can get its act together.
The plan to organise overseas roadshows was announced on the day when the Union Cabinet failed to approve a key economic legislation for reasons unknown.