Maharashtra Chief Minister Fadnavis has secured 60+ MoUs at the World Economic Forum. Some of these companies are located in India, including Maharashtra, which has led the opposition to question the credibility of the deals and start calling them a ‘Show off’.
The Davos Assignment
Devendra Fadnavis, the Chief Minister of Maharashtra, was accompanied by Industry Minister Uday Samant during a five-day visit to Davos, Switzerland, where they attended the World Economic Forum. Their main objective was to secure investments to improve Mumbai’s infrastructure, which includes creating a top-tier financial services hub and an innovative city. Samant also has plans for development in Pune and other regions.
He intends to channel investments to boost the manufacturing sector in the Marathwada region.
MoUs and Deals at the World Economic Forum
On the first day, the Maharashtra government got to sign 32 memorandums of understanding worth 9.30 lakhs, with Chief Minister Fadnavis saying,” This is a new record for securing such a significant investment amount in a single day and several investment agreements are expected on the second day as well,”
The interested investors included companies such as Tata Group, Carlsberg Group, Lulu Group, ReNew Power, RIL, Schneider Electric India, Mastercard, Louis Dreyfus, Cognizant, and more. Fadnavis also met the former Prime minister of the UK Tony Blair, he expressed his experience by saying, “We had an insightful discussion on public transport, energy transition, with Maharashtra at the forefront, set to source over 50% of its energy from renewables soon. Mr. Blair expressed his eagerness to visit India soon, and we also discussed India’s progress, the Davos agenda, and Maharashtra’s role as a powerhouse. Moving from 48GW to 78GW, energy transition remains a key focus for our future,”
Other signee companies include Blackstone, brewer Anheuser-Busch InBev, Singapore’s Temasek Capital Management, Everstone Group, and U.K. government entity Crossrail International.
Fadnavis winning confidence with the lock-ins of deals said, “We’ll be the first sub-national trillion-dollar economy in India” and “Almost 98 percent of the total signed MoUs will be of foreign direct investment, we will ensure that all these MoUs turn into a reality”.
The Questions Being Raised
In India, various opinions and criticisms began to emerge regarding the investments facilitated by the Maharashtra government. Nana Patole, the president of the Maharashtra Congress, commented on the memorandums of understanding (MoUs) signed in Switzerland, stating, “It shows that the state government just wants to inflate the MoUs and investment amount to misguide the people. However, the reality is completely different.”
He emphasized that the companies making the investments are Indian, rather than bringing in actual foreign direct investment (FDI). A revelation stated that out of 61 MoUs, 45 involved domestic companies, with 36 of them based in Mumbai. The total MoU amount of 10.13 lakh originated from state-based businesses.
The former Chief Minister of Maharashtra called the Davos trip a ‘Show-off’. The Economist named Ajit Joshi said, “The problem with these MoUs is their credibility in the financial sector… Which bank will lend money to an industry that is promising an investment the size of its total net worth?”
Companies like Viraj Profiles from Thane, one of the investors, show an investment of 12,000 crore, which matches the company’s net worth. The same case applies to other investor companies as well. Joshi comments on this, “These are very tough times for the Indian economy. A slowdown is the talk of the town. In such a situation, any investment is good. But the problem with these MoUs is their credibility in the financial sector, Which bank will lend money to an industry that is promising an investment the size of its total net worth?” in discussion with Frontline.
The Answer
“Coming to Davos was necessary because 98 percent of the total investment will come as FDI. These companies have tie-ups with their international partners for technology as well as other purposes. If they are investing in Maharashtra, then they need confidence. If the government is present here, they will get that confidence,” quoted Fadnavis rejecting claims and questions by the opposition.
The Industry Department of the Maharashtra government has not given any information on Economic forum investments.
Haripriya Mishra is a journalist deeply interested in world news and geopolitics. She likes to explore the complexities of global affairs and strives to bring clarity to these issues through thoughtful journalism. Through her writing, she intends to raise the right questions, fostering informed discussions about national and international matters. Haripriya aims to use journalism as a platform to connect with people, share diverse perspectives, and contribute to a deeper understanding of global issues. She is committed to producing content that is accurate, ethical, and impactful. She enjoys creative writing and reflecting on the nuances of media and storytelling.
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