Sydney: Australian companies are being urged to invest with increased vigor in the Indian economy following a thaw in bilateral ties, which had suffered a setback after the May 1998 nuclear explosions.

Indian High Commissioner (HC) to Australia R S Rathore, at a seminar titled "Investment Opportunities in India," said that due to the existence of many "commonalities and institutional linkages between the two countries," the opportunities to increase Australian investments in India were immense.

He urged Australians to import more from India as current imports stood at a "pathetic figure" of Australian $ 714.5 million or 0.6 per cent of its total imports.

100 per cent foreign equity is now possible in pharmaceutical and drug industries, civil aviation and hotel and tourism industries, Rathore said. Up to 74 per cent foreign investments can be made in the telecom sectors.

The Indian economy has been liberalised to a great extent now as to meet Indian commitments to WTO (World Trade Organisation), Rathore said. The Defence industry, the "hitherto holy cow," has also been opened to private sector and foreign investments can be made in this industry too, he said.

Another speaker, Som Majumdar, director South East Asia Division of Hunt and Hunt, spoke at length about tremendous opportunities available to Australian insurance companies in India due to the "second generation economic reforms."

Austrade export development general manager Colin Hook matched the enthusiasm of the speakers in urging more bilateral trade with India, but pointed out few pitfalls that could harm Australian companies investing in India if they have not done the "homework."

Hook's list of "turn ons" included the huge market size in India, comparatively cheap labour, English speaking work force and business people and the same legal system as in Australia. His "turn offs" for a business venture in India were the slow pace of reforms and the all-prevailing bureaucratic obstacles.

India Abroad News Service