With the fresh political air in Myanmar, business is receiving its own share of freshness too. After Pro-democracy leader Aung San Suu Kyi’s recent elections victory which has freed the country’s economy from the military Junta, Myanmar is opening up business and trade. But once again China has pipped India as the largest investor here.
Around 70 percent of total FDI inflows into the country come from China, followed by Thailand, South Korea, Singapore, Malaysia and Japan as other major investors, reports Business Standard. India is the 13th largest investor in the country with an investment of around $189 million in five projects.
Big guns like ONGc Videsh (subsidiary of ONGC), Gail, Essar, Punj Loyd, Tata Motors and NHPC are already present in the country. Gail has offshore gas assets on Myanmar’s north-western coast, though it has no plans for expansion. It is basically transporting natural gas to China rather than beinging it back to India as planned earlier, BS reports.
Even Mahindra sees a lot of potential in Myanmar in far equipment, but skepticism is high. First there are doubts whether 2015 can see free and fair elections. Second, there can be arbitrary executive decisions as it is not a free market yet.
However, US Republican senator John McCain asked the United States on Monday to suspend most sanctions on Myanmar to encourage the country’s reforms. The embargo, he argued, was required to be lifted to speed up the reform process though there military dominated firms should continue to remain blacklisted.
If this is done, the over cautious India Inc may consider making long-term investments in the country. But can it get the tacit government support to do so?