Markets for Efficiency and Inclusion

Open, integrated, and well-regulated markets for land, labor, and capital and for goods and services are essential for growth, inclusion, and sustainability. We have many sectors were markets are non-existent or incomplete, especially those which are dominated by public provisioning. How do we create or improve markets in all sectors?

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Should the ceiling on FII investments in Government securities/ Corporate bonds be relaxed?

Postby chanana.ak@nic.in » Wed Feb 02, 2011 7:17 am

Should the ceiling on FII investments in Government securities/ Corporate bonds be relaxed?
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Re: Should the ceiling on FII investments in Government securities/ Corporate bonds be relaxed?

Postby ashok06121952@gmail.com » Fri Feb 04, 2011 2:11 am

:D :D :roll:

FII investment is welcomed to Govt.Securiities only but locking period should be for 5 years or till the ROI is released.

FII investment in corporate bonds lead to sometimes bankrupt of the companies on withdrwal of investment or there is unrest/economic disaster in the foreign countries.
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Re: Should the ceiling on FII investments in Government securities/ Corporate bonds be relaxed?

Postby rakesh.agarwal@dmsiitd.org » Fri Feb 04, 2011 3:34 pm

Hello India!!
I would rather support FDI investments than FII. I acknowledge FII investment is also important for they provide the necessary liquidity through financial markets. However, FDI investment is for long term. One cannot exit a company before the project is ready. Example Posco Project. FDI investments in the past have been thwarted due to inability of the government to provide congenial environment. The foreign investors are left on their own to tackle the complex paper work. The slow judiciary adds to their problems.

So, I would want to see an agency set up, which can steer FDI projects in India. The agency can be a single point for all the clearances.

Thanks
Rakesh
Student
IIT Delhi
Contact me at rakesh.agarwal.iitd@gmail.com
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Re: Should the ceiling on FII investments in Government securities/ Corporate bonds be relaxed?

Postby wjgtf87t42b@gmail.com » Tue Feb 08, 2011 8:16 am

India must be willing to dream big and most importantly be open to ideas based on how other successful nations have done.
The pdfs from the following link shows tiny Abu Dhabi's economic vision for 2030.
Perhaps we can copy some ideas from them.


http://dpeportal.adeconomy.ae/portal/pa ... ema=PORTAL
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Re: Should the ceiling on FII investments in Government securities/ Corporate bonds be relaxed?

Postby rakesh.agarwal@dmsiitd.org » Wed Feb 09, 2011 12:34 pm

I think it is very important that ceiling on FII investments in Corporate bonds and government securities are relaxed because of following reasons -
1. It will decrease the cost of funds for corporates, which will help in furthering investments in the production of goods and services. It will also help in employment generation.
2. Government of India can fund its deficit at lower interest rate, benefiting the whole country.
3. The decline in interest rate of corporate bonds and government bonds will help in decreasing interest rate on other instruments as well . This will decrease cost of funds for other sections of society.

The other most important factor that will help in decreasing cost of funds for the Indian investors is development of a vibrant debt market. There has been a constant demand for development of debt market, but not much progress has occurred in this domain.

Regards
Rakesh
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