7 October 2002 – US-based General Electric Corp (GE) prefers to make its overseas investments in China than in India due to better infrastructure and rate of return, according to the head of GE’s Indian operations.
Speaking at a conference organized by national HRD Network in India Thursday, GE-India’s president and Chief executive Scott Bayman said China offers business opportunities in sectors like engineering, plastics and healthcare, which was five times large in size than Indian market.
“Investors will go where the returns are” and there are other far favourable locations for investments than India, Bayman said. “China is moving rapidly to develop infrastructure to support business but we do not see the same level of interest in India to develop facilities”, he added. “The unfortunate experience with Dhabol power project would discourage FDI in India’s infrastructure sector”, Bayman said adding without political support and regulatory enforcement the power sector reforms cannot move ahead.
On the country’s privatisation process, GE executive said despite a setback due to three months freeze on disinvestment in Hindustan Petroleum and and Bharat Petroleum, the process will move forward albeit at slow pace. There was a backlash over privatisation policies but five years down the line there would few companies under the government’s wing, he added.
Separately, GE’s chairman and Chief Executive Officer Jeffrey Immelt said the company would continue to strive to achieve double-digit annual profit growth. Economies throughout the world are showing signs of a slowdown, but GE is poised to continue maintaining annual sales growth of 6-7 per cent, Immelt said.
Although there is some speculation in the US that the firm will not be able to secure annual double-digit profit growth, GE will work to achieve annual growth of 10 per cent or more, he said. Immelt cited expectations for global growth in markets such as healthcare, information technology and infrastructure.
As for specific regions, China will become a major centre of growth, he said. For a company to grow, it needs to continue making investments, Immelt said, indicating that GE plans to maintain investments at a certain level.