How Saudi Arabia's $100 billion Investment in India Will Go a Long Way In Meeting Infrastructure Goals
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The kingdom’s ambassador to India, Saud bin Mohammed Al Sati, recently said Saudi Arabia is looking to make investments in India potentially worth $100 billion in the areas of energy, refining, petrochemicals, infrastructure, agriculture, minerals and mining.
Infrastructure in India
Infrastructure is one of the sectors which gets the highest foreign direct investment (FDI). Inflows in the verticals such as townships, construction development projects and housing were recorded at $25.5 billion between FY00 and FY19. Schemes such as ‘Housing for all’ and ‘Smart Cities Mission’ have benefitted from these investments.
In August, the Union Cabinet allowed 100 per cent FDI in coal mining and related infrastructure activity. The government has been burning midnight oil to stabilize the economy in the past few months and has given a massive push to the infrastructure sector by allocating INR 4.56 lakh crore in the last Budget.
Saudi Arabia’s Investment in Indian Infrastructure
According to the Saudi Vision 2030, the country plans to invest in robust markets to diversify the economy and reduce its dependence on income from oil. In India, the investments are likely to be in petrochemicals and highways, among others.
Saudi Arabia’s interest to invest in India is likely to pace up ongoing projects related to highways and housing. According to the Saudi ambassador, it has been observed that around 40 opportunities for joint collaborations across various sectors majorly infra and petrochemicals have been identified between India and Saudi Arabia.
Petrochemicals and Other Sectors
India imports 19 per cent of its crude oil and 32 per cent of LPG requirement from Saudi Arabia. Referring to the Saudi Arabia's oil behemoth Aramco's close ties with Mukesh Ambani-led Reliance Industries, the ambassador said it will important in developing energy ties between the two nations.
“Saudi Aramco’s proposed investments in India’s energy sector such as the $44 billion West Coast refinery and petrochemical project in Maharashtra and long-term partnership with Reliance Industries represent strategic milestones in our bilateral relationship,” the Saudi ambassador said.
Speaking about the vision 2030, the ambassador mentioned that Saudi Arabia is looking at the post-oil age world-class technology research and entrepreneurial diligence.
Foreign Investments in Indian Infrastructure
Japan has always been an active player in investing in the Indian market. From automobiles to railways, Japan has played a vital role in boosting Indian infrastructure. Aiming to augment the sector, India has joined hands with Japan to forge ties for advanced development of the north-eastern states and is setting up India-Japan Coordination Forum.