India’s economy grew at 9.2% in the year to March, the fastest-ever since economic reforms were launched in the early 1990s. Inflow of FDI in particular grew almost three times to $15.7bn from $5.5bn in the previous year. That is more than a quarter of the $54.6bn total inflow of FDI that India has attracted since August 1991, when economic reforms were begun.
The rapid rise in foreign investment is a vote of confidence from international investors for the energy and enthusiasm that Mr Nath brings to his job. He has been a tireless ambassador in India’s quest for investment, addressing the concerns of international investors, and negotiating domestic policy issues, and has emerged as a key figure in international trade negotiations. As Mr Nath puts it: “FDI plays an important role in the long-term economic development of the country, not only as a source of capital, but also for enhancing competitiveness of the domestic economy through transfer of technology, strengthening infrastructure, raising productivity and generating new employment opportunities.”
Under his stewardship, India’s investment policy has been liberalised to make the country’s vast economy attractive and accessible to foreign investment. In a review of FDI rules last year, his ministry streamlined the process of investment, doing away with multiple approvals from government and regulatory agencies – often a nightmarish experience for prospective investors. New sectors, even politically sensitive ones such as real estate and retail trade, which had in the past remained firmly shut to foreign investors, are being progressively opened up. Investments are starting to flow into India’s infrastructure sector – to build new airports, ports, roads, highways, and telecommunications and power networks – all of which are vital for the country’s sustained economic progress.
India’s importance in international trade has grown in recent years, with exports growing at about 25% in the past three years. In international trade negotiations, Mr Nath has played a key role in advancing the interests of developing countries in general, and India in particular, at the multilateral, regional as well as bilateral level. India has signed an economic agreement with Singapore, and is discussing a free trade agreement with the Association of South East Asian Nations (ASEAN). A framework agreement between Bangladesh, India, Myanmar, Sri Lanka and Thailand (BIMSTEC) is being pursued as a link between the two major regional groupings ASEAN and the South Asian Association for Regional Co-operation.
For his tireless efforts in putting India on the global FDI map, Mr Nath emerged our clear winner for the fDi Personality of the Year award. Reacting to the award, Mr Nath said: “I feel honoured for being recognised as global fDi Personality of the Year 2007. This recognition is a tribute to India’s business sector, which has worked towards India’s substantial engagement with the global economy.”