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Investment: Capital inflows likely to turn positive in Q4: CMIE |
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Capital flows into India are likely to turn positive in the fourth quarter of FY 09, according to economic think-tank, Centre for Monitoring Indian Economy (CMIE) forecast.
"We expect the capital account of the balance of payments (BoP) of the country to experience a net flow of USD 3,740 million in the March 2009 quarter as against an outflow of USD 3,683 million in the December 2008 quarter," CMIE said in its monthly report on the state of the Indian economy.
In addition to the higher net flow, the report forecasted that the foreign direct investment (FDI) into India would continue to rise, with Q4 of FY-09 expected to record an inflow of $3,900 million in this account.
According to the report, the official BoP data for the December quarter of the last fiscal showed an outflow of $ 3.7-billion, for the first time in a decade.
India now a prime player in global M&A league
India will enter the global pecking order of the largest M&A's done so far in 2009 with the proposed Bharti Airtel-MTN deal. It is going to be the third largest deal so far in 2009 and if pharma sector is excluded, it will be the largest deal so far globally. Bharti’s proposed acquisition of 49% stake in MTN worth up to $29 billion may become the largest cross border acquisition by a domestic company after the $12.7 billion Tata-Corus deal.
The proposed acquisition is the third largest M&A deal after pharma major Pfizer acquired Wyeth in January for nearly $64 billion and Merck’s acquisition of Schering-Plough for nearly $46 billion, also in the pharma sector. It is also the largest acquisition in India’s telecom sector and in Africa by a domestic company. The deal will even surpass that of China’s ICBC which acquired South African bank Standard Bank group worth $5.6 billion in October 2007 — the biggest African cross border inbound deal on record so far.
Till date, the largest acquisition on record in Africa by a domestic company is Ranbaxy’s acquisition of Be-Tabs Pharma for $70 million announced in 2006.
Last year Godrej Consumer Products bought Kinky brand of hair business for $33.2 million, while in January this year that of Tata Communications and Neotel for an undisclosed amount.
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