Karnataka Third In Attracting FDI.

The reputation of being India’s Silicon Valley notwithstanding, Bangalore is far behind the national capital of Delhi in wooing foreign companies to set up their shops in India.

As per the data compiled by the Ministry of Corporate Affairs, the national capital is home to close to half (1,521) of total 3,138 foreign companies that are operating in the country.

Maharashtra, which has two major financial hub—Mumbai and Pune—stood second with 744 companies setting up their base while Karnataka is in the third position with 248 firms preferred to be located in. Tamil Nadu stood fourth  with 187 firms while 179 companies have preferred Haryana as on August 18, 2011.

Though IT and IT related companies still preferring Bangalore or Chennai, Gurgoan in Haryana and Noida in Uttar Pradesh with  improved  infrastructure facilities, are emerging as favourite destinations, says the report.

The top three states —Delhi, Maharashtra and Karnataka— account for over 80 per cent of foreign companies.

Political uncertainties, infrastructure and power issues will remain a major hurdle for the State in attracting foreign direct investment in the days to come, sources in the Corporate Affairs Ministry said.

Power crisis may continue to hurt the state’s growth story as there is no possibility of major capacity additions in generation in the next four years. The state has to meet its demand and supply gap by buying power from independent power producers from outside the state, said a senior official in the Ministry of Power.

Source : deccanherald.com