Economic Times: June, 2015
NEW DELHI: In what could be the first significant investment by a Chinese company, the country's top real estate player, Dalian Wanda Group, plans to invest $10 billion in India in the next 10 years to construct industrial townships and retail properties.
Wang Jianlin, the billionaire chairman of the Beijing-headquartered group, expressed his intent to explore business opportunities in India at a meeting with Prime Minister Narendra Modi in New Delhi on Tuesday.
The Dalian Wanda Group, which had an annual income of $38.8 billion in 2014, has a presence in commercial property, tourism, ecommerce and department stores. It is looking at building five industrial parks in India, besides shopping malls and theme parks. Wang is ranked by Forbes as the world's ninth-richest person with a net worth of $40.4 billion.
The government has relaxed foreign direct investment norms in the construction sector, easing a three-year lock-in period and other stringent conditions related to built-up area and minimum capitalisation to attract funding in the cash-starved sector.
In meetings with officials from the Department of Industrial Policy & Promotion, the Ministry of External Affairs and state governments, Wang was keen to know about incentives offered by states and the land acquisition process. He sought information on policies for commercial development and retail construction in Delhi, Haryana, Andhra Pradesh, Gujarat and Maharashtra.
"His team wanted to know about the availability of land banks in these states for commercial and retail infrastructure construction. They also wanted to know about the specific investible projects available in states," said a government official.
During his visit to Beijing last month, Modi pitched for Chinese investment in India to help bridge a widening trade gap. His visit saw deals worth $22 billion being signed. Increased Chinese investment in India is seen as a possible way of addressing India's trade deficit with China, which widened to $48 billion in 2014-15.
"To correct this trade imbalance, it was necessary that Chinese industry invests and manufactures in India instead of exporting its products to India. India needs to look at infrastructure financing from China," DIPP secretary Amitabh Kant said at a FICCI event on Wednesday.
The Wanda group shared its intent to develop 10 urban complexes in the next 4-5 years in the country.
Though the group entered India through a deal with the Reliance Group in December 2012 to develop the Dhirubhai Ambani Knowledge Centre in Navi Mumbai, it is firming up plans to invest heavily here only now. Wang also met railway minister Suresh Prabhu, Haryana chief minister Manohar Lal Khattar and private developers on Wednesday. According to sources, Wang met officials of real estate developer DLF as well. The government allowed 100% FDI in railway infrastructure last year.