Destination India 2: Important initiatives by new Indian Government……Have you invested in India or still watching?

Indian government, under Mr. Modi’s leadership with a mantra of “Minimum Government, Maximum Governance”, has taken some very important initiatives to reduce bureaucracy, increase transparency, speedy execution, reduce redundancy, improve work culture, foster international relations, increase defense capabilities and guard borders, increase competitiveness and instill faith of corporate and individual investors .

Some of these steps taken within 1st 40 days are summarized below - Not just promises but Actual steps:

A. Border Protection and Defence:

  1. Approved fast-track road building along the disputed border with China.
  2. New 50 posts in strategic position of Indo-China Border.
  3. $2 billion extension to the Karwar Naval base in Karnataka to take the load off Mumbai.
  4. Radar station in the Andaman and Nicobar islands in the Bay of Bengal
  5. Radars and telecommunications projects within 100 km (62 miles) of the 4,000-km (2,500-mile) border with China on an automatic approval list.

B. Fostering International Relations:

  1. Attendance of SAARC leaders in swearing in ceremony and successful bi-lateral talks
  2. Asked ISRO scientists to develop SAARC Satellite
  3. Heads of Indian Missions (Embassy) of neighborhood countries invited for a 1-day conclave. I expect it to be followed up with other countries in future.
  4. All Major countries – USA, UK, France, Germany, Russia, Japan, China have invited Mr. Modi for visit.

C. Getting Ready (Most Important steps that pave the way for the future)

  1. Scrapped 21 Groups of Ministers (GoM) and 9 Empowered Groups of Ministers(EGoM) to expedite decision making and increase greater accountability in the system
  2. Ministers are not allowed to hire relatives in their personal staff but have to select from general pool only.
  3. Sweeping changes at Government Offices and working Habits of Bureaucrats:
      1. Start working at 9:00 am sharp (ministers and top officers making round everyday at 9 am);
      2. no extended lunch or tea breaks;
      3. neat, clean and professional office space(150,000+ unwanted files found in cupboards are archived – oldest one was from 1948 relating to sanction of travel allowance of Rs. 64,000 to Lord Mountbatten on his final return);
      4. asked to be more responsive to the public and resist political interference by ministers and MPs;
      5. asked to repeal all laws and rules which come in the way of effective Governance and make all Government application forms short and simple;
      6. if good proposal blocked by the minister, they can pitch it directly to Mr. Modi – only in PowerPoint format – to the point.
  4. Leadership and Motivation lessons for Bureaucrats (who are having permanent job with no motivation):
      1. Chetan Bhagat on the objective of improving productivity and bringing out new ideas to streamline government processes;
      2. Shiv Khera on leadership and motivation;
      3. Nitin Nohria, Dean of Harvard Business School (HBS) on Leadership Lessons

D. Making Progress

  1. Adopted self-attestation of certificates, photographs and mark sheets, instead of requiring attestation of documents by Gazetted Officer or a magistrate
  2. Approved raising of Narmada dam’s height to 138 meters from 121.92 meters – More water for drinking, irrigation and power generation
  3. Approved Road Projects of 40,000 crores (approval of additional 35,000 crores soon)
  4. Approved 7 projects worth 21,000 crores, some of which were held up for decades(oldest – for 30 years)
  5. Approved 9 new transmission projects of Inter-state transmission lines for 12,500 crores

E. Other

  1. Allowed only Scientist and Technical associates to attend Scientific Conferences in India and abroad. No Minister or Bureaucrat is allowed as a part of the delegation.
  2. Planting of 200 crore trees along the entire 1 lakh km National Highways network
  3. Approved strategy to provide broadband connectivity to 2.5 lakh gram panchayatsthrough nearly 6 lakh km of optic fibre by March, 2017.
  4. Set up of Special task force for black money (it’s a start)
  5. Recognition of Indian Engineering degrees across 17 countries

These are selected list of news that I found and/or noticed.

Digesting these news, equity markets in India have been best performing markets in the world with Bombay Stock Exchange crossing 25,900 mark (July 4 closing 25,962).

Since May 16, 2014, when Mr. Narendra Modi was set to take control of the India’s strategy and vision to drive growth with inclusive development agenda, Investors in Indian equity have seen their wealth increase by 8.5%+ within a short span of 50 days.

On May 20, I wrote an article “Destination India: How to Invest in World’s next bull market as FDI, NRI or FPI” detailing the procedures and asking ANYONE in or out of India to Invest in India. Since then, the Equity investors have earned 6.5% in 1.5 months.

Naysayers will always be there with excuses as monsoon, Iraq, inflation, budget, market too high, etc. but they still have to agree that the Indian Government is actually working and making progress in the right direction, and it is the only thing that counts to generate double digit returns in the long run of 5-10+ years.

So……….

Are you still watching?

Mr. Jigar Patel is a Management Consultant for Investments in India by Indians, NRIs as well as Foreign nationals providing holistic consulting considering rules and regulations relating to investments as well as Indian and international taxation for generating higher risk adjusted after-tax return; and can be contacted at jigar@nareshco.com

Disclaimer: This is prepared solely for general information purposes and is based on the various news and other sources available through internet. We do not guarantee its accuracy and is may not be correct or may change at any time without notice. The information is not intended to constitute a recommendation, offer or advice and is subject to change without notice. Before making any decision, please consult your accountant, adviser or financial planner. Views are personal. No responsibility for the interpretation and/or use of information assumed.

About Jigar Patel, CFA (USA), MBA-Finance (USA), CPA (USA), CA (India)

Mr. Jigar specializes on NRI Investments and Taxation. He is proud to be one of only 21 CFA Charterholders in India working as consultants. (In 2011, when he became CFA Charterholder, out of 97,173 CFA Charterholders in the World, only 697 Charterholders were in India and only 3% work as consultant; Source: www.newcfa.org). He received his MBA (Finance) from University of Illinois, Chicago, USA, CPA from USA and a Chartered Accountant from India. Jigar has over 15 years of professional experience including more than 4 years with KPMG USA’s Risk Advisory Services. Currently, he provides Wealth Management and taxation consulting serving clients from USA, UK, Americas, Europe, Middle East, Asia, Africa, Australia and India.
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