Oct 21, 2006 :: Tata - Corus raises India’s profile

While the Mittal-Arcelor deal just 4 months ago created the world’s largest steel company, it aroused a lot of investor hostility and left most Indians cold with indifference. In contrast, the announcement today of Tata’s taking over the Anglo-Dutch Corus has triggered countrywide celebrations. That speaks highly for Tata’s reputation, built over a century of commitment to India. Tata Steel, in the last decade has reinvented itself to become the world’s lowest cost producer of steel.

The $8 billion deal was the largest overseas investment by an Indian company and has been welcomed by the management and workers of Corus. There is another little noticed feature about India’s economy, which is growing at close to 9% despite little foreign direct investment [FDI]. The mammoth FDI China receives is often held out to contrast with India’s lowly number. Has anyone observed this: in the last nine months India received $8.3 billion as FDI but Indian companies have pumped out $7.5 billion to acquire 115 companies around the world.