Singapore,Mauritius,British Virgin Islands and Channel Islands accounted for nearly 60 per cent of Indias outward foreign direct investment proposals during the nine-month period ended December 2009. These countries together got $8.15 billion during the period with Singapore becoming the top destination of Indian FDI with $5.1 billion proposals,according to a study by the Reserve Bank of India.
British Virgin Islands (BVI) and and Channel Islands popular tax havens have got $1.3 billion,or nearly 13 per cent of the total FDI outflow proposals,during the nine-month period. BVI has only 21,000 people but it has over 400,000 companies registered there. During April- December 2009,the shares of Singapore,Sudan,Mauritius,the British Virgin Islands and the UAE in Indias outward FDI have increased while those of the US,the Netherlands and the UK have declined, the RBI said.
The RBI said during the period April-December 2009,the actual outward FDI in JVs and wholly-owned subsidiaries stood at $8.4 billion,which showed a decline of 34.1 per cent over the investment of $12.7 billion during the corresponding period of the previous year. Of the total amount of investments,70 per cent was in the form of equity,and most of the remaining amount comprised loans,while there was small amount under invoked guarantees.
Against this,during April- December 2008,80 per cent of the amount of investments was in the form of equity and the remaining 20 per cent was loans,while there was no invocation of guarantee. Thus,during April-December 2009,the share of equity has gone down in the outward investments with the amount of equity showing a negative growth of 41.9 per cent, the RBI said.
During the first three quarters of 2009- 10 (April-December 2009),2,984 proposals amounting to $14.3 billion were cleared for investments abroad in JVs and WOSs,as against 2,828 proposals amounting to US$16.4 billion during the corresponding period of the previous year. While the number of proposals recorded an increase of 5.5 per cent over the corresponding period of the previous year,the magnitude of investment proposals showed a decline of 12.8 per cent,it said.