RE:It is a run-away rattle-snake, out and loose.
by chanakya maurya on Oct 04, 2007 02:07 PM Permalink
PC has already warned the retail investor who must book profits, go home, and enjoy the quality time with the family members.
Great work Mr Roy....u r bang on spot.....alas !!! no one in North or south block is listening. God will not forgive them for what they are doing to our economy. Its a challange....Just STOP the PN route to investment in India, and see the fun....90% of these so called FII who r selling indian growth story, will vanish....Its nothing but unaccounted easy money creating Havoc in Indian Market....Now , who is there to supply so much money? From where its generated?...Who will bell the cat? And save our economy?
The Indian economy is a guarded economy. Immense restrictions to foreign investment and disinvestment. This is clear from the restriction placed on the free conversion of the Indian Rupee to other currencies and then the transfer of other currencies out from India.
Basically the Indian Government is saying that you cannot take your money out of India in foreign currency without permission.
In India have heard and spoken to many bankers and managers of banks who say you can take your money out. But in actuallity once your money is stuck in India, the Indian Banks and Indian Government introduce suprise red tape and bureaucracy in moving funds out of India.
So as long as the Indian maket is closed to free foreign currency movenment, the Indian market will never be a safe place for foreigners to invest.
If you think of it the other way, foreigners are free to bring and take money out of western countries any time without any red tape.
So India has to change its policies towared foreigners.
Moreover, there are restrictions on foreigners investing in the Indian Stock Market and that is a big big big danger.
So why should any foreigner bring more money into the Indian maket?
RE:India a Baby-Sitted Economy
by lax on Oct 03, 2007 10:25 PM Permalink
Restrictions on Foreign participation in Stock markets & remittances are well placed. U must understand that the Indian economy is still not as strong as western economies.. any wild gyrations in stock-markets & currencies can pose serious problems... remember the asian-currency crisis.
Even with all these restrictions, the FIIs (foreigners) already corner a sizeable part of Indian stocks. FIIs are basically speculators who are not interested in long-term investing. If free-flow of currencies are allowed without investment limits to FIIs, then they will devastate our economy. India still has a long way to go... & its better to be safe than sorry.
Dear Editor, Subir Roy has done a fantastic job in analyzing the currrent situation & putting forth his recommendations in a simple & direct manner. Kudos to him, well done. I wish this is implemented. Among other things, I have long been wondering why retial investors have been allowed to invest only Rs 1 Lakh in IPOs. If we allow the retail Indian people to participate more, it insulates us from these FIIs actions & gives us a better chance to build wealth domestically.
May we have more such thought provoking & effective articles from u, Subir!!
RE:RE:India vulnerable to Financial Risk
by lax on Oct 03, 2007 10:28 PM Permalink
yup.. u r right... 1 lac is peanuts nowadays... good suggestion by Subir.. Retail investors need to be encouraged more... lets tap domestic savings first then go for foreign-borrowings.
RE:India vulnerable to Financial Risk
by Archana Lakshmi on Oct 04, 2007 02:44 PM Permalink
What we see now in Indian market is irrational exuberance. No doubt that India, Inc is performing well and in growth mode but the question is whether the current valuations are justifiable. It is sad that our indices are so much dependent on FII and if they pull the plug we are gone. If FII find some other markets that can provide higher returns or if anyother bad news busniess or in the political side, they will take their money out and our markets wil be in big trouble. US markets (NYSE and NASDAG) do not have so much of FII stake like in India and they depend more on their domestic institutional and retail investors. Hope we will get to that soon.
