Corporate investments - Good news and bad news

    First the good news. Indian companies are growing their overseas businesses at a rapid pace in recent years.

Despite the global economic turmoil, 93 per cent of the Indian mid-sized companies, which do international business, saw growth in revenues from their overseas business, a HSBC survey said here today.
It added that 95 per cent of the companies with global footprint plan to expand their current international business in the next two years. ...

 Interestingly, almost 50 per cent of them have reported that their revenues from abroad have grown faster than domestic revenues in the past 12months.
While 69 per cent of the firms saw their international business growing faster or at the same pace as their domestic business, the report said.

    This is great for both the companies involved and their employees. Apart from establishing new markets for their products, companies and employees gain valuable exposure to international practices and techniques that can be adopted at home. This could also help them compete better with foreign companies in their own backyard.

    Now the bad news. One of the reasons for this outward push is that companies are finding it hard to do business in India.

Here's an economy that's growing at close to 8%—plus a huge market—at a time when the US and Europe are struggling with creaking growth, growing unemployment and rising debt; and yet the buzz across boardrooms is that investing abroad is "at least headache-free". They complain about frustrating delays in government approvals at all levels, primarily those related to land acquisition and the environment.

    At a time when millions of jobs need to be created every year to meet the needs of a growing young population, this is very disappointing. Finding evidence to support Deepak Parekh's claim is not very hard. Land acquisition has been a perennial problem with most large projects, both public and private. There are renewed talks of a land acquisition bill. This could not come soon enough.

    There has been encouraging news about opening up FDI in multi-brand retailing. This needs to be coupled with renewed impetus on infrastructure investments. Society of Indian Automobile Manufacturers (SIAM) is renewing their call for labour reforms.
   
    If India has to pull hundreds of millions of it's citizens out of poverty, it needs to attract investments at much higher rates than being witnessed now. And that cannot be achieved with reforms in a whole raft of sectors.