Expand remittances for at least 10 yrs: FM to NRIs

NEW DELHI: Expressing confidence that the Indian economy would clock close to 9 per cent growth this fiscal, Government on Tuesday promised NRIs of coming out with financial instruments for attracting their remittances for longer duration.

Pointing out the NRI remittances to India, on an average are of three-year duration, Finance Minister P Chidambaram asked them to expand their horizon to bring longer term money for at least 10 years, as well as their expertise in various fields into the country.

Addressing a Pravasi Bharatiya Divas seminar here, Chidambaram promised NRIs that the government would bring new financial instruments and institutions to help them bring longer term money and their knowledge base into India.

He particularly asked them to bring their expertise to put agriculture on a sustained growth path of not less than four per cent in a year so that fruits of growth could reach every section of society.

"I am confident this year would end close to nine per cent. I don't know where the decimal would fall," Chidambaram said, adding the government aims to sustain the high growth rate of the economy.

This aim was not just imaginary, but what has been demonstrated by south east Asian countries in 1980s and currently by China, he said.

Two tools that would enable India sustain the high growth rate is investment and knowledge, he said, asking the NRIs not to limit their remittances for short period and think for the long term.

"There is no limited horizon of three years. Captains of industry has unfolded plans for ten to 20 years. For the first time, you find Indian industry acquiring businesses abroad. NRIs should also expand their horizon," he said.

If NRIs do that, Chidambaram promised to come out with new financial instruments to receive the money.

To a question from the floor, he said whatever political parties may say in opposition, reforms have never been reversed in India which should give NRIs confidence enough to put their money for longer duration in India.

Pointing out that knowledge base of NRIs was much more important than physical wealth, he admitted there was no institution in India on the lines of Foreign Investment Promotion Board to attract this pool of expertise.

He promised to examine the idea of setting up an institution for attracting NRIs' expertise for the benefit of the country.

Pointing out that infrastructure needs close to 25 billion dollars from abroad in the next five years, he asked NRIs to help India develop infrastructure like roads, power and so on.

"We are in the process of discussing various kinds of instruments and also institutions to attract investments like using forex for infrastructure or establishing special purpose vehicles like IIFC... Many ideas are under discussion," he said.

To a question from an NRI about corporate social responsibility, he said it should not be government-driven but should come from within the industry.

He said there is no proposal under government consideration to set up an NRI Council for channelising money from the Indian diaspora, though no one would stop NRIs from setting up such a body.