40% investors back out from Madhya Pradesh after global summit

More than 40 per cent potential investors have backed out from doing business in Indore region after placing proposals during the Madhya Pradesh government’s ambitious Global Investors Summit in October last year, official data showed.

More than 40 per cent potential investors have backed out from doing business in Indore region after placing proposals during the Madhya Pradesh government’s ambitious Global Investors Summit in October last year, official data showed.

Foreign-delegates-participate-in-the-Global-Investors-Summit-in-Indore-Arun-Mondhe-HT-file-photo

The summit, addressed by Prime Minister Narendra Modi and attended by top corporate honchos of the country, was aimed at showcasing the state as a major investment destination for overseas and domestic industrialists.

While the state government has not officially released the status of investment proposals received during the summit, sources said that there has been no follow-up in about 40% of the total proposals.

According to figures compiled by the district industries centre (DIC), as many as 437 investment proposals were received for Indore region but 189 of them have conveyed their unwillingness to doing business.

“It seems that most of these investors were not serious but had (just) come to listen to Prime Minister Narendra Modi,” said a DIC official who did not wish to be named.

State industries commissioner VL Kantha Rao, however, said that a “conversion rate of 55% to 60% of investment proposals is quite good”.

“The state government had not signed any MoUs but received ‘intent to invest’ most of them online, so many investors might not have done their homework. For instance, if an industrialist had proposed to invest Rs 5,000 crore for setting up a steel plant but had subsequently realised that he would not be able to get iron ore from Madhya Pradesh he would have pulled out,” Rao said when reached for his comments.

The CII’s state unit had said earlier that despite the tall claims of the government to cut red tape and implement a single window system, the state still had to go a long way in becoming truly industry-friendly.

According to official sources, the government had received 3,716 investment proposals for the entire state worth Rs 5.89 lakh crore during the summit and even if 50% materialised, it would mean an investment of nearly Rs 3 lakh crore.

Between 2012-14, the state saw investments worth Rs 1.82 lakh crore.