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India, ASEAN-5 more fetching to FDI than other emerging markets

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As per Japanese financial services firm Nomura, India along with ASEAN – 5 countries (Indonesia, Malaysia, Thailand, Philippines and Vietnam) is more attractive Foreign Direct Investment (FDI) destination as compared to other emerging markets.

Highlights of Report by Nomura:

Nomura has dubbed India and ASEAN-5 (Indonesia, Malaysia, the Philippines, Thailand and Vietnam) as “Asia’s tiger cubs”and has said that Foreign Direct Investment (FDI) flows to these nations are expected to surge to around USD 240 billion by 2025. FDI

  • Moreover, sources of FDI to these nations are also witnessing a significant shift with more inflows expected from countries such as China and Japan. 
  • As rising labour costs in China and an ageing population in Northeast Asia have reduced their attractiveness as foreign direct investment (FDI) destinations, “India and the ASEAN-5 are well placed to emerge as new destinations.
  • Large and growing domestic markets, reforms focussed on improving infrastructure and the ease of doing business, a more open and liberal FDI regime, sound economic management and political stability, and availability of low-cost labour are the factors that are expected to encourage FDI into India and ASEAN-5.
  • In India, FDI is expected to flow into sectors that need growth capital such as infrastructure, banks, e-commerce and hospitals and those with strong long-term growth prospects which include retail, automobiles, pharmaceuticals and diagnostics.
  • The report outlined that FDI inflows will be largely negative for listed companies in e-commerce due to increased competition whereas those in auto component, retail, hospital, infrastructure and capital goods segments will be benefitted.

About Nomura:

Nomura Holdings, Inc. is a Japanese financial holding company, and a principal member of the Nomura Group. It, along with its broker-dealer, banking and other financial services subsidiaries, provides investment, financing and related services to individual, institutional and government customers on a global basis with an emphasis on securities businesses.

  • It was formed in year 1925.
  • Headquarters of Nomura is located in Tokyo, Japan.
  • Koji Nagai is the current Group CEO.