Tap Japanese companies: Deepak Parekh

Veteran banker Deepak Parekh has suggested that states should take steps to lure Japanese companies that are being pushed by their government with a $2.2 billion incentive to relocate from China. The states could offer the companies land with permission and access to utilities, he said.

“We should make it easy for the Japanese to come to India rather than them going to Malaysia, Vietnam or Thailand. States have to take the initiative and offer them 2000-5000 acres in some special zone where they do not have to look for land or building approvals,” said Parekh. Japan’s incentive to companies is a part of its stimulus package. The HDFC chairman warned that the Covid-19 crisis could result in real estate prices correcting by as much as 20%.

In a webinar on Friday, Parekh pointed out that central banks, the world over, are buying commercial paper and debt issued by private entities. He said RBI is pushing money into banks that are reluctant to invest in the debt of private companies and when they do it is at very high spreads. Another outcome of the crisis, he said, would be ‘deglobalisation’. He pointed out that European countries have already made it mandatory for government approval for all acquisitions.

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