Category — Economy

Sequoia to Raise $1 Billion India-Focused Fund

Menlo Park, California-based Sequoia Capital plans to raise up to $1 billion for its sixth India-focused fund, making it the largest corpus raised for India markets. The corpus will be raised across multiple vehicles, such as as venture capital focused on technology companies, and growth-stage capital focused on consumer and other non-tech investments.

Sequoia Capital’s team in India also leads investments in Southeast Asia and has set up an office in Singapore. This region will be a significant part of the strategy in the upcoming fund for Sequoia Capital India, which manages about $3.2 billion of investments.
A signborard with 'investment' written on it

January 30, 2018   No Comments

AngelList Launches Syndicate Services for India

San Francisco-based AngelList, a crowdfunding platform and start-up community, launched ‘Syndicates for India’— a way for investors in India to invest alongside experienced angels and venture investor funds that invest in India’s vibrant tech ecosystem.

AngelList Logo

For investors, syndicates are a private single-deal investment vehicles that let an investor invest in startup allocations shared by syndicate leads, enabling more angels to participate by getting access to top deals. Similar to a venture investor fund, syndicates provide experienced investors the opportunity to earn carried interest on their allocation, and the ability to write bigger checks by pooling capital from dozens of backers in the ecosystem

These syndicate programs operate in the U.S., Canada, and the U.K. and through them, AngelList has facilitated investments of $700 million combined in over 1,800 start-ups including Uber and Indian start-ups such as ClearTax, DocTalk and Squad.

January 24, 2018   No Comments

Mauritius Continues to Be Largest Channel for FDI to India

Based on a census that it undertook, a report by India’s central bank, the Reserve Bank of India, said, “Mauritius was the largest source of foreign direct investment (FDI) in India (21.8 percent share at market value) followed by the U.S.A., the U.K., Singapore and Japan, while Singapore (19.7 percent) was the major overseas direct investment destination (ODI), followed by the Netherlands, and the U.S.A.” The census yields comprehensive information on the market value of foreign liabilities and assets of Indian companies arising from FDI, ODI and other investments.  Historically foreign investors who expect capital gains from the ultimate sale of their stake prefer to invest via this tiny island nation due to a favored tax deal between India and Mauritius.

Reserve Bank of India logo

Other key findings of the census were:

  • Of the 18,667 companies that participated in the census, 17,020 had FDI/ ODI in their balance sheets in March 2017
  • “96 percent of the responding companies were unlisted in March 2017 and most of them had received only inward FDI; unlisted companies had a higher share of FDI equity capital compared to listed companies”
  •  Over 80 percent of the 15,169 companies that reported inward FDI were subsidiaries of foreign companies (single foreign investor holding over 50 percent of the total equity)
  • Non-financial FDI companies had a much higher share in total foreign equity participation compared to financial FDI firms.
  • “The ratio of market values of inward to outward direct investment, increased to 4.3 in March 2017 from 3.6 a year ago; equity participation accounted for 94 percent and 79 percent shares in inward and outward FDI, respectively,”
  • The manufacturing sector accounted for nearly half of the total FDI at market prices; information and communication services and financial and insurance activities were the other major sectors that attracted FDI.
  • Total sales, including exports, of foreign subsidiaries in India increased by 18.7 percent during 2016-17 whereas their purchases, including imports, increased by 20.1 percent.

January 24, 2018   No Comments

At Davos, Modi Promotes India’s Development Agenda

In a keynote address to the World Economic Forum 2018 in  Davos, Switzerland, Prime Minister of India, Narendra Modi projected India as a country with a vast market and strong and stable fundamentals, and exhorted world leaders to consider India as an attractive destination for doing business. He then went on to outline “the five pillars” of India’s development agenda:

  • Modi’s first pillar of support to improve the business climate in India is instituting much needed reforms. Recent reforms in India have touched many facets of India’s economy: direct tax, banking, creating a digital database of citizens, expanding the tax base, controlling inflation and corruption, and reducing fiscal deficit. Indeed, there has been a sharp rise in FDI in the past three years–from $36 billion in 2014 to $60 billion in 2017. Modi added that India “has resolved many regulatory and policy issues facing businesses, investors and companies,” and its states are now competing to attract business investment.
  • The second avenue of support for business is the increasing use of technology to transform governance and deliver public entitlements and services. Both the Federal and State governments are deploying technology to ensure that time-bound decisions are delivered to business entities.
  • The third pillar to improve the economy is the Indian government’s focus on upgrading physical infrastructure such as roads, railways, airports in tier I, II and III cities, as well as sea ports. “The scale and scope of this task is immense. Our Sagarmala [meaning, sea necklace] project seeks to connect our long coastline and ports to the hinterland,” he said.
  • The prime minister said he was aware that India needs to be aligned with the world in major policy areas such as “the entry and exit of businesses, IPRs, or arbitration and commercial adjudication. We have moved very decisively to brush up the framework to bring them in line with global best practices,” he added.
  • “The fifth pillar is inclusive economic development. As I said, the biggest reason for fracture within the countries is inequality and disparity leading to divide and distrust,” stated Modi.
PM Modi in Davos for World Economic Forum Meet

PM Modi in Davos at World Economic Forum

January 24, 2018   No Comments

Israel’s Netanyahu Hails “New Era” in Ties with India

Benjamin Netanyahu, the first Israeli prime minister to visit India in 15 years, accompanied by his wife Sara on a six-day visit to India, were given a warm welcome by Prime Minister Modi. Driving the growing ties is both leaders’ shared worldview for national-security and free-markets. Both see Israel’s technology-oriented economy as a natural fit for India’s, which needs innovation to improve everything from farming to healthcare.

The Prime Minister, Shri Narendra Modi and the Prime Minister of Israel, Mr. Benjamin Netanyahu during Press Statement, at Metanyahu and Modi at Hyderabad House, in New Delhi on January 15, 2018.

At a press conference in Hyderabad House, New Delhi on January 15, 2018

Netanyahu hailed a “new era” in ties with India as he signed a series of deals on cybersecurity, energy, biotechnology, agriculture, and defense during his first visit. Israel has given initial approval for Indian energy companies to explore oil and gas in the eastern Mediterranean. Bilateral trade has jumped from $200 million in 1992, when the two countries opened diplomatic relations, to $5 billion in 2017.

 

Sara and Netanyahu visited Gandhi’s Sabarmati Ashram in Ahmedabad, Gujarat, where Netanyahu tried his hand at a spinning wheel, a pastime Gandhi made popular while he was jailed during British colonial rule. They also visited the Taj Mahal in Agra, and attended a ceremony to name a square in New Delhi ‘Teen Murti’ in honor of the Indian soldiers who died in the fight to liberate Haifa from the Turks in 1918.

Netanyahu addressed the India-Israel Business Summit organized by the Federation of Indian Chambers of Commerce and Industry in  New Delhi. On his last night in Mumbai, Prime Minister Netanyahu partied with Bollywood bigwigs such as actor Amitabh Bachchan and director Abhishek Kapoor, and pitched Israel as a film destination: Not just because you can see the snow, the beach, the desert, the salty sea and a sweet-water lake within an hour’s drive, he said, but also because Israel has “great technology for businesses and big ideas.”

 

January 19, 2018   No Comments