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Abu Dhabi, UAESaturday 23 June 2018

India's Modi heads to Davos to woo more foreign investors

Government is seeking investors for several sectors, including aviation

The key message that Mr Modi wants to deliver in Davos is that India is ripe for and open to more global investment. Prakash SINGH/AFP
The key message that Mr Modi wants to deliver in Davos is that India is ripe for and open to more global investment. Prakash SINGH/AFP

Narendra Modi is on a mission to attract more foreign investment into the country as he heads to Davos on Monday, becoming the first Indian prime minister to attend the World Economic Forum in the Swiss ski resort in more than twenty years.

The key message that Mr Modi wants to deliver in Davos is that India is ripe for and open to more global investment.

“Our economy has expanded significantly since the last time an Indian prime minister went to Davos and therefore this visit is very important,” said Vijay Gokhale, the ministry of external affairs secretary, told reporters at a conference in New Delhi, according to a transcript of the conference published online. “We want to tell the world to invest in India.”

This comes as India's economy has slowed, weighed down by the impact of demonetisation and the effects of the introduction of a new goods and services tax, or GST. The economy grew at 6.3 per cent in the July to September quarter compared with 7.5 per cent in the same quarter a year earlier.

The Indian government is keen to boost economic growth, with general elections coming up next year, and a need to create more jobs for the country's young population. Attracting foreign investment is seen as a way of helping to achieve higher levels of economic growth.

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To try to bring more funds from overseas into the country, Mr Modi's government this month liberalised foreign direct investment (FDI) regulations for a number of sectors including single brand retail and construction. It also announced that foreign airlines would be able to take a stake of up to 49 per cent in Air India.

India attracted more than US$60 billion of FDI in the financial year to the end of March 2017, which was a record amount for the country, according to official figures.

Mr Modi is due to give a keynote address at Davos and will engage in a bilateral meeting with Swiss president Alain Berset, and the Indian prime minister will also host a roundtable dinner for heads of top global firms and Indian companies during his trip.

Mr Modi's message would be about India being an economy that could be “an engine of global growth”, according to Mr Gokhale.