"I am not against hasty
marriages, where a mutual flame is fanned by an adequate income."
—Will Durant (American,
1885-1981)
Word for the day
Variegated (adj)
Varied in appearance or
color; marked with patches or spots of different colors.
Malice towards none
Some present day politicians
remind me of a short story by legendary Khuswant Singh, titled "Princess
of Kahin Nahi" (The princess of nowhere)!
First random thought this morning
This morning, leaving apart
some understandings at the local level, an united national opposition to the
marching BJP looks like a mirage.
Shrewd politicians like Amit Shah
and Narendra Modi would be fully aware that the Congress Party and the
degenerated socialists are opportunists and fast losing popular support. They
are taking full advantage of this.
Arvind Kejriwal must be ruing
his impatience. Has he controlled his larger ambitions and waited for the right
time (which may be coming in next 12months), he could have easily emerged as
the fulcrum of opposition unity. Alas! he exposed his limitations too soon and
too much.
Factroing Japan in investment strategy - 2
The Japanese demand for Indian assets is so strong that assets of
Nomura Holdings Inc.’s India equity fund quadrupled to almost 400 billion yen
($3.6 billion) in just the past year.
Another fund, Sumitomo Mitsui Asset Management Co.’s Indian bond
fund, co-managed with Kotak Mahindra AMC, took in a net 24 billion yen ($214
million) from December through June, lifting total assets to about 87 billion
yen as of July 10.
Japanese investors' portfolio investments in Indian stocks and
bonds stood at $13 billion at the end of June 2017. As I mentioned yesterday (see
here) the process that started a decade back in September 2007 has begun to
gain significant momentum. A bilateral free-trade agreement, signed in 2011, is
heralding a new phase in crossborder trade and investment.
In a recent press interview, the Japanese Ambassador to India
Kenji Hiramatsu said, "We have already signed the Comprehensive Economic
Partnership Agreement (CEPA)." he further added that "many
companies are shifting their operation bases or manufacturing bases to India
and they are producing their products here and selling them in the Indian
market. Also they are developing industries or local part industries, as in
they are making spare parts and not importing from Japan. It means that we are
not only talking about the bilateral trade figure but in a wider context. Also
I would like to say that the products that are produced here are exported to
Japan, and some to the wider global market including Africa, Middle East and
other neighboring countries, so Japanese companies are looking not only at the
Indian market but also at the regional and the global market."
Japanese firms’ did not start the process of buying assets in
India on a happy note. The ill-fated purchase by pharmaceutical company Daiichi
Sankyo in 2008 of Ranbaxy proved to be a major sentiment dampener. NTT’s
loss-making joint venture with Tata Group also did not end on a happy note.
Nonetheless, these disappointments did not deter Japanese investors. M&A is
picking up. As per available data Japanese companies made some 46 acquisitions
(including minority stakes and joint ventures) in India in 2014, up from just
23 in the previous year.
To put things in perspective, as of 2015, close to 1000 Japanese
firms had reported some kind of operation in India. This compares with 1400
firms in Thailand and close to 2500 in China. Till 2014, India accounted for
only 1% of the outbound FDI from Japan, and less than 1.5% of Japanese exports.
In 2015, Japanese prime minister Shinzo Abe promised to double
both Japan’s investment and the number of Japanese companies operating in India
within five years, targeting ¥3.5trn (US$33.6bn) of private and public
financing.
This needs to be understood in the context of (a) rising tension
between Japan and China; (b) India promising to be remain fastest growing
economy; (c) India offering a stable macro environment with a high yield
differential compared to most of the developed world; and (d) traditional
Indo-Japan cultural and religious ties.....to continue tomorrow.
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