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11 January 2012 01:28 am - 1     - {{hitsCtrl.values.hits}}

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MUMBAI, India - Ajay Piramal is sitting on a mountain of cash. Yet the billionaire Indian tycoon, working in one of the world’s fastest growing economies, is struggling to figure out what to do with the money. The problem isn’t opportunity, he said. It’s India.
“Every large investment, there was no transparency,” Piramal said.
His dilemma is a worrying sign for India. With the country mired in corruption, bureaucratic red tape and unclear and changing government policies, many of the men who made their billions here are saying maybe it’s time to quit India. It’s got to be easier to do business elsewhere.
In May last year, Piramal’s healthcare business sold its generic drug operations to U.S. pharmaceutical giant Abbott Laboratories for $3.8 billion. Piramal, a tall big man in a country that still measures prosperity by girth, was eager to set that cash pile to work. He wanted to expand one of his chemical plants, but was told it would take five years.
“The same plant could be set up in China in two years,” he said. “I love India, but my customer is not going to wait.”
India, still a beacon of relatively fast growth despite a troubled world economy, should be a magnet for capital. Instead, since the beginning of 2010, the amount that Indians have invested in businesses overseas has exceeded the amount foreigners are investing in India, according to central bank figures.
In part this reflects the confidence and aptitude of India’s maturing companies and the current malaise in the global economy and financial markets. But it also reflects deep problems at home. India’s big coporations may be cash rich but the failure to invest that money domestically is bad news for a developing country that needs capital to build the roads, power plants and food warehouses that could help lift hundreds of millions out of dire poverty.
The frustration of India’s business elite with corruption, political paralysis, log-jammed approvals, regulatory flip-flops, lack of access to natural resources and land acquisition battles — to pick a few of the top complaints — has reached a pitch perhaps not heard since India began liberalizing its economy in the early 1990s.
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  • Leslie Thursday, 12 January 2012 05:43 AM

    He is wary of investing in Sri Lanka with the Business Appropriation Bill in our statue books.


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