FIIs heady on India, pooh-pooh policy glitches

A furore has been raised by sections of top brass in industry and banking about the government’s flip-flops in policy-making and taxation driving away FIIs and causing sever damage to India’s reputation as an high-potential investment destination.

Amidst the cackle and volley of disparaging remarks voiced regarding the problems in India, a section of private equity (PE) experts and venture capitalists (VC) have expressed a completely different point of view, reports CNBC-TV18.
Niten Malhan, MD, Warburg Pincus, said, "We are long-term investors and therefore we tend to look through the euphoria and periods when people think everything is wrong. Because by definition, we look at investments. So, regarding problems like macroeconomic glitches in interest rates in India, I think some of them are cyclical and will pass."
"There are issues around governance in terms of policy-making , regulation and taxation. Again our view is that these are issues will hopefully get sorted. I don't think there are any long-term problems." Malhan was speaking at the Indian Private Equity and Venture Capital Association (IVCA) Conclave 2012 held on Thursday.
Explaining further, Anil Ahuja, head - Asia, 3i, said, "I think we have seen these cycles just about six-to-seven times so far. There is always this sentiment which goes up and then overshoots on the upside."
"And then there is a sentiment that goes down and shoots on the downside. And frankly what is happening today, a lot of it is driven by policy, politics, governance and issues like that."
The conclave was organised to celebrate ten years of the private equity and venture capital sector in India.
Mahendra Swarup, president, IVCA, "There is an opportunity for large deals. But a lot of small deals will be closed which did not happen in last 5 years."

This is the first-ever exclusive gathering of members of the PE and VC community and around 250 delegates from across the globe participated in the event.