China, India Hot Spots For Foreign Investment Inflow, Says Unctad

Chennai, April 26 | Updated: Apr 27 2004, 05:30am hrs
The United Nations Commission on Trade and Development (UNCTAD) has ranked India second only to China as the most favoured destination for Foreign Direct Investment. Significantly, China and India come on top of developed nations like the US and Britain as favourite FDI locations.

According to the latest Prospects for FDI flows, TNC Strategies and Promotion Policies published by the UNCTAD, China ranks first followed by India as the favourite location for foreign capital inflow. While the US ranks third, Thailand comes fourth as favourite FDI destinations. Poland and Czech Republic share the fifth rank, while UNTAD has not given the sixth rank to any countries. The seventh rank was shared between Mexico and Malaysia, again it has left the ninth position vacant. Britain, Singapore and South Korea share the ninth position among themselves.

Significantly, India is the only country from south Asia to figure in the list. While east Asia and south east Asia were represented by China and Malaysia.

UNCTADs survey of international location aims at assessing future developments in FDI with a view to providing information relevant for policy makers in charge of devising promotion policies and regulatory frameworks for FDI. The respondents of the survey are international location experts closely involved as consultants, advisors and analysts in the investment location decision making process of transnational corporations (TNCs).

The survey says in India, where FDI flows have been low, location experts expect significant boost in FDI. In Asia and the Pacific, China and India take the top positions as attractive destination for foreign direct investment in the near future, the survey said.

In Asia and the Pacific, optimism is broad-based in terms of industries. In the manufacturing sector, improved prospects are expected for automobile and other transport equipment, machinery and equipment, chemicals and to a lesser extent electrical and electronics products, publishing and media and printing and recording industries, the survey said.