Foreign direct investment in the telecom sector plunges to $ 43 mn in Apr-Sep

FDI down. Reuters

The experts said that in addition to the global economic slowdown, which has influenced the inflow, the sector is facing a lot of problems in their own country.

"The overall condition of the telecommunications sector is very critical. Industry is smaller in terms of margins and profitability and that is the main reason why foreign investors are shying away, "MOBILE PHONE industry body COAI Director General S Rajan Mathews said.

Another industry expert said that the initial euphoria of the sector now is over and the Government is now focusing on the promotion of the framework of the manufacturing part.

The decline comes at a time when economic growth has slipped further in the July-September quarter to 5.3 percent, raising fears that the delay can pull down the annual growth rate to a ten-year low.

Overall, foreign direct investment in India fell by about 33 percent to 12.84 billion dollars in the first half of this fiscal of 19.13 billion dollars in the year ago period.

Sectors which attracted significant FDI inflow during the first six months of this fiscal record services (3.04 billion dollars), metallurgical (685 million dollars), agriculture ($ 644 million) and car ($ 635 million).

For the period April-September India received maximum FDI of Mauritius (6.25 billion dollars), Japan (1.32 billion dollars), Singapore (1.12 billion dollars) Netherlands (968 million dollars) and the United Kingdom (592 million dollars).

The inflow had combined to 36.50 billion dollars in 2011-12, compared with 19.42 billion dollars in 2010-11 and $ 25.83 billion in 2009-10.

Decrease of the pressure on foreign investment the country balance of payments (BoP) and also could affect the value of the rupee.

PTI

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