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Saturday, June 28, 2003

FDI numbers? 

The FDI that India manages to attract is a source of considerable angst to most India-watchers. Now the government seems to have made a decision to alter its method of alculating FDI inflows. According to the IFC, after a change of computation methodology, FDI would represent 2% of GDP for China and 1.7% for India, a source of comfort I am sure for the mandarins of Delhi. An editorial in the Business Standard talks about this decision by the Indian government.

The decision to re-calculate the foreign direct investment (FDI) figures will help make the Indian government's data comparable with that of other countries. Currently, the government's FDI statistics do not include re-invested earnings, subordinated debt, overseas commercial borrowings, inter-company debt transactions, loans, voluntary grants, financial leasing and trade credits -- all included in other countries FDI statistics.