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11 May, 2012, 06.13PM IST, Shantanu Nandan Sharma,ET Bureau
Ahead of Prime Minister Dr Manmohan Singh's maiden visit to Myanmar later this month, India Inc is gearing up to do business with the nation with which India shares a 1643-km border. Pro-democracy leader Aung San Suu Kyi's recent elections victory has also triggered corporate India's interests.
"Uncertain environment and lack of infrastructure were major setbacks for India Inc venturing into Myanmar. But the environment is changing fast. The recent political developments have made Myanmar a favourable investment destination," says DK Sarraf, managing director of ONGC Videsh (OVL) which is investing one billion dollar, or Rs 5000 crore, in two oil blocks. The commencement of production will begin in May 2013, and sale of gas is expected to continue for 30 years.
But the industry is looking beyond hydrocarbon. "India Inc has been showing interests to invest in healthcare services, IT, telecom and infrastructure sector in Myanmar. Also, Indian companies are realizing that Myanmar will ultimately be the gateway to some of South East Asian countries such as Laos, Thailand, Vietnam etc," says Ram Upendra Das, senior fellow at New Delhi-based think tank Research and Information System.
Also, Indian government's recent extension of a $500 million (Rs 2,500 crore) new Line of Credit to Myanmar means new opportunities for India Inc.
Tata Motors, RITES and United Bank of India (UBI) among others have already taken up projects in Myanmar. The Kolkata-based UBI has inked pacts with three nationalized banks in Myanmar, and has been facilitating border trade during the last four years. It has now received the RBI nod to open a representative office in Myanmar which is likely to be set up soon.
"Uncertain environment and lack of infrastructure were major setbacks for India Inc venturing into Myanmar. But the environment is changing fast. The recent political developments have made Myanmar a favourable investment destination," says DK Sarraf, managing director of ONGC Videsh (OVL) which is investing one billion dollar, or Rs 5000 crore, in two oil blocks. The commencement of production will begin in May 2013, and sale of gas is expected to continue for 30 years.
But the industry is looking beyond hydrocarbon. "India Inc has been showing interests to invest in healthcare services, IT, telecom and infrastructure sector in Myanmar. Also, Indian companies are realizing that Myanmar will ultimately be the gateway to some of South East Asian countries such as Laos, Thailand, Vietnam etc," says Ram Upendra Das, senior fellow at New Delhi-based think tank Research and Information System.
Also, Indian government's recent extension of a $500 million (Rs 2,500 crore) new Line of Credit to Myanmar means new opportunities for India Inc.
Tata Motors, RITES and United Bank of India (UBI) among others have already taken up projects in Myanmar. The Kolkata-based UBI has inked pacts with three nationalized banks in Myanmar, and has been facilitating border trade during the last four years. It has now received the RBI nod to open a representative office in Myanmar which is likely to be set up soon.