Epaper
CLASS ASSIGNMENT
ON
”AUTOPISTA CENTRAL, S.A.
THE VALUATION OF A TOLL ROAD PROJECT IN CHILE”
UNDER THE GUIDANCE OF: SUBMITTED BY: GROUP 2
PROF. A. NATESHA PRASAD SUDHIR KUMAR (ROLL NO 67)
RISHABH BATRA (ROLL-NO-58)
IMRAN QASIM (ROLL-NO-33)
MUKUL MALHOTRA (ROLL-NO-42)
DEEPAK CHAUHAN (ROLL-NO-22)
EPGDIB
SESSION: 2011 - 2013
INDIAN INSTITUTE OF FOREIGN TRADE (IIFT), NEW DELHI
TABLE OF CONTENTS
1. INTRODUCTION: 4
2. EVOLUTION OF INDIAN FDI: 5
3. INDIAN ECONOMY:CURRENT STATUS AND FUTURE PROSPECTS: 6
4. FOREIGN DIRECT INVESTMENT IN INDIA SINCE 1991: 7
5. FOREIGN DIRECT INVESTMENT BY AN INDIAN COMPANY: 8
5.1 AUTOMATIC ROUTE 8
5.2 GOVERNMENT ROUTE 9
6 SECTORAL FDI FLOW: 9
6.1 CHANGING DYNAMICS OF INVESTMENT: 9
7 CONCLUSIONS: 10
8 REASONS TO INVEST IN INDIA: 12
9 CHALLENGES FOR LOCAL PLAYERS AND FOREIGN COMPANIES 12
LOOKING TO ENTER THE MARKET: 12
10 PROJECTED SPENDING FROM FY07-FY12 IN SELECTED INFRASTRUCTURE SEGMENTS: 13
11 STRUCTURAL CHANGES IN INDIA’S FOREIGN TRADE: 15
11.1 HISTORICAL BACKDROP: 15
11.2 FOREIGN TRADE IN 2ND AND 3RD PLAN: 16
12 INDIA IN TWIN DEFICIT CLUB – IMPLICATIONS AND ISSUES: 25
13 TWIN DEFICITS – BASICS 25
14 26
15 FISCAL/BUDGET DEFICIT: FISCAL DEFICIT MEANS GOVERNMENT EXPENDITURE IS MORE THAN ITS REVENUES. THE GOVERNMENT HAS TO BORROW TO MEET ITS EXCESSIVE EXPENDITURE LEADING TO GOVERNMENT ABSORBING HIGHER PORTION OF DOMESTIC SAVINGS AND HIGHER INTEREST RATES. THIS IN TURN LEADS TO CROWDING OUT OF PRIVATE SECTOR INVESTMENT IN THE ECONOMY. HIGHER INTEREST RATES, IN TURN LOWERS THE PRIVATE SECTOR INVESTMENT AND CONSUMPTION LEVELS. IN MANY ECONOMIC HISTORY CASES, WE HAVE SEEN GOVERNMENTS RESORTING TO PRINTING PRESS TO MANAGE THEIR DEFICITS LEADING TO HYPERINFLATION AS SEEN IN CASES OF GERMANY, HUNGARY AND ZIMBABWE. 26
16 CURRENT ACCOUNT DEFICIT: 26
17 26
18 TWIN DEFICITS IN INDIA - TRENDS AND 1991 CRISIS 26
19
ON
”AUTOPISTA CENTRAL, S.A.
THE VALUATION OF A TOLL ROAD PROJECT IN CHILE”
UNDER THE GUIDANCE OF: SUBMITTED BY: GROUP 2
PROF. A. NATESHA PRASAD SUDHIR KUMAR (ROLL NO 67)
RISHABH BATRA (ROLL-NO-58)
IMRAN QASIM (ROLL-NO-33)
MUKUL MALHOTRA (ROLL-NO-42)
DEEPAK CHAUHAN (ROLL-NO-22)
EPGDIB
SESSION: 2011 - 2013
INDIAN INSTITUTE OF FOREIGN TRADE (IIFT), NEW DELHI
TABLE OF CONTENTS
1. INTRODUCTION: 4
2. EVOLUTION OF INDIAN FDI: 5
3. INDIAN ECONOMY:CURRENT STATUS AND FUTURE PROSPECTS: 6
4. FOREIGN DIRECT INVESTMENT IN INDIA SINCE 1991: 7
5. FOREIGN DIRECT INVESTMENT BY AN INDIAN COMPANY: 8
5.1 AUTOMATIC ROUTE 8
5.2 GOVERNMENT ROUTE 9
6 SECTORAL FDI FLOW: 9
6.1 CHANGING DYNAMICS OF INVESTMENT: 9
7 CONCLUSIONS: 10
8 REASONS TO INVEST IN INDIA: 12
9 CHALLENGES FOR LOCAL PLAYERS AND FOREIGN COMPANIES 12
LOOKING TO ENTER THE MARKET: 12
10 PROJECTED SPENDING FROM FY07-FY12 IN SELECTED INFRASTRUCTURE SEGMENTS: 13
11 STRUCTURAL CHANGES IN INDIA’S FOREIGN TRADE: 15
11.1 HISTORICAL BACKDROP: 15
11.2 FOREIGN TRADE IN 2ND AND 3RD PLAN: 16
12 INDIA IN TWIN DEFICIT CLUB – IMPLICATIONS AND ISSUES: 25
13 TWIN DEFICITS – BASICS 25
14 26
15 FISCAL/BUDGET DEFICIT: FISCAL DEFICIT MEANS GOVERNMENT EXPENDITURE IS MORE THAN ITS REVENUES. THE GOVERNMENT HAS TO BORROW TO MEET ITS EXCESSIVE EXPENDITURE LEADING TO GOVERNMENT ABSORBING HIGHER PORTION OF DOMESTIC SAVINGS AND HIGHER INTEREST RATES. THIS IN TURN LEADS TO CROWDING OUT OF PRIVATE SECTOR INVESTMENT IN THE ECONOMY. HIGHER INTEREST RATES, IN TURN LOWERS THE PRIVATE SECTOR INVESTMENT AND CONSUMPTION LEVELS. IN MANY ECONOMIC HISTORY CASES, WE HAVE SEEN GOVERNMENTS RESORTING TO PRINTING PRESS TO MANAGE THEIR DEFICITS LEADING TO HYPERINFLATION AS SEEN IN CASES OF GERMANY, HUNGARY AND ZIMBABWE. 26
16 CURRENT ACCOUNT DEFICIT: 26
17 26
18 TWIN DEFICITS IN INDIA - TRENDS AND 1991 CRISIS 26
19
References: When we divide the whole period into two sub periods, that is, 1950-51 to 1979-80 and 1980-81 to 2004-05, the growth rates of GDP and per capita income recorded in the first sub period and second sub period differ substantially.