Be Indian Buy Indian.. A deep understanding..(part2)

1. Foreign multinationals invest “initial capital” in the country:
According to a statement given in the parliament, after the globalisation-liberalisation, the MoU. (Memorandum of Understanding) signed for investment in India by foreign multinationals in the period July 1991 to November 1997 is Rs. 94500 crores. This figure is just what they promise and what we see in newspapers. But the “Actual-Inflow” is Rs 19400 crores. This means only 20% of the MoU signed has invested. It’s for the period of 5 and half years. So, about Rs 3500 crores per year has been invested. Does this make a significant percentage in a country whose yearly budget is over 2 and half lakh crores of rupees and domestic savings is over 2 lakh crores of rupees in a year? Even in that actual inflow, major portion is “Capital-Money”. This is the one, which is put in share-market. This hot money doesn’t help in increasing production or employment opportunities. Reserve Bank statistics says that in this period of 5 and half years Rs 34240 crores has flown out of India in the form of profit by these foreign multinationals (note that actual inflow was Rs 19400 crores).

These multinational companies take more money each year in the form of profit than their initial investment. Hindustan Lever (UniLever, Holland) invested Rs 24 lakh in 1933. Its profit in 1995-96 is Rs 240 crores. It means it takes thousand times of its initial investment every year. For 70 years, guess how many thousand times of 24 lakh it has taken out. Colgate Palmolive (U.S.A.) invested Rs 1.5 lakh in 1936. Its profit in 1996 is Rs 77 crores. Bata India Ltd. invested Rs70 lakh in 1931. Seebagaayiga (Switzerland) invested Rs 48 lakh. PepsiCo from USA has invested Rs 40 crore after Globalization in 1991. Its profit in 1996 is Rs 240 crore. USA’s Coca-cola, Johnson & Johnson, Germany’s Hakest, Bayer, German remedies, England’s Horlicks, SmithKline Beechem – like that there are over 5000 foreign multinational companies in India. They take thousands of times of their initial investment, every year. East India Company was doing the same thing. When we got independence, Jawaharlal Nehru should have sent all the foreign multinationals out of India. But none of them except East India Company was sent out!