State stands eighth in drawing investments

State stands eighth in drawing investments

Change laws: FKCCI chief

According to the first quarterly report (March 2009) of the Centre for Monitoring Indian Economy (CMIE), Gujarat scores over other states with a total live investment of Rs 10,73,073 crore.  “Live investment” is defined as the total investment spent on projects being implemented and those already implemented.

The CMIE is an independent economic agency headquartered in Mumbai. It prepares reports on country’s economic status at regular intervals.

The Union and State governments subscribe to the Centre’s reports in assessing their efforts to achieve economic growth. The Centre collects data from various sources including records of industrial licences granted and letters of indent issued by industries.

Rohit Sabherwal, Head (Business Development) of CMIE, Mumbai, said the Centre’s main sources include annual and interim reports of the companies. “Besides, we hold meetings with company’s analysts and call up company officials to update records,” he said.

As per the CMIE report, Karnataka’s live investment as on March 2009 stands at Rs 4,57,093.50 crore. This is the total investment the State has received so far. However, the State government argues that it would be in a better ranking if investment proposals so far cleared by Karnataka Udyoga Mitra are considered. The State would be in a better position if investment proposals approved through Karnataka State High Level Clearance Committee and Single Window Committee are considered. The CMIE has omitted these facts. It collects facts from letters of indents and licenses approved, said KUM Managing Director Venugopal.

Further he argues, Karnataka stands in third position in terms of inflow of foreign direct investment equity in the last nine years (April 2000 to March 2009). As per a RBI’s report FDI equity inflow to Karnataka in nine years is Rs 25,674.50 crore while that for Maharashtra is 1,34,287.63 crore. New Delhi has received Rs 55,308.98 crore.

FKCCI President D Muralidhar said that four years ago Karnataka was one among the first four States and slipped to either seventh or eighth position in the last two years. “Running a business is costlier in Karnataka compared to neighbouring states. Acquiring land, obtaining power supply and labourers are difficult tasks here,” he said.

“In Bangalore BBMP wants industrialists to obtain trade licences. Stamp duty on mortgages here is the highest of all states. The government should bring in changes in law to attract investors”, he said.