Power Finance Corporation's tax free bond issue with an average 7.5% annual coupon rate worth 700cr got oversubscribed 12 times i.e. investors have submitted funds worth 8400cr legally. That is $1.3 bn. The same thing happened with the NTPC bond issue last month. That means billions of dollars of white money is eagerly waiting in India itself looking for modest 7.5% post-tax returns. I wonder why the PM is going abroad to seek investments? Is Zuckerberg’s money whiter than ours?
Besides, one would do well to understand that just letting money flow into the economy is not the end. It is the beginning.
The important question to ask ourselves: As of today 6 Oct 2015 is our economy 'absorbent' enough? In my IT microcosm the answer is no. I know of a very good IT company which recently interviewed 100 candidates and found only 3 fit for hire.
Because more and more money is chasing fewer and ill-qualified engineers, artificial and undesired wage inflation has occurred. The astronomical housing cost is feeding this frenzy very well.
Just 2 points to paraphrase
Are we missing the investment potential that lies under our very noses?
Are we capable of absorbing investments?
