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9/21/2019 Houston event: Why India may announce big FDI into America - The Economic Times

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Houston event: Why India may announce big FDI into


America
BY IANS | UPDATED: SEP 21, 2019, 12.47 PM IST Post a Comment

By Robinder Nath Sachdev

Your author is going out on the proverbial limb. Bricks are mine to take, and if things pan
out as analysed below, then the bouquets are welcome.

On Sunday, September 22, US President Donald Trump and Prime Minister Narendra
Modi will meet twice in Houston. One meet-up between the two leaders shall be at an
event hosted by the Indian-American community, with over 50,000 in audience where both
Modi and Trump will be jointly present, and both shall address. The other meet-up will be
a Modi-Trump summit.

The Houston meets will be only about the bilateral


Let us speculate about the outcomes of these two meetings in Houston. Both are smart US-India relationship.
leaders. Both know optics and choreography, emotions, economics. Both also know that
after their summit at Houston, publics and media will demand to know what they both
Big Change:
accomplished for their each country. The end of Five-Year Plans: All you need to know

So, if both are meeting in Houston, then what are the tangible outcomes that they can announce that are impressive for audiences in the
US, and in India? For a moment, forget about global issues. The Houston meets will be only about the bilateral US-India relationship.
The various other global, counter-terror, and such will be kept for the New York bilateral which will happen just days subsequently. Your
author shall write on that later.

So, at Houston, what will be a big announcement that should be good for America? Elementary, Watson. It will be an announcement that
India, or in fact some Indian company, will do an FDI, invest a few billions of dollars into the US, or into an American company.

This will serve dual interests -- India will secure energy security, of oil or gas supplies, at fixed rates, for the long term. And, Trump, will
be able to tout to his American audiences that his international trade policies have been effective, and that he has been able to bring in
US$ x billions into the US economy -- from a rising economy like India.

Why this deal? Again, elementary, Watson. India needs oil and gas. American oil and gas delivery on Indian shores is almost
competitive now in terms of global prices. Given the variety of uncertainties in the oil and gas supply to India, including the latest drone
attack that has crippled half of Saudi Arabia production, India must lock in a safe, predictable supply of oil and gas for the next 20-30
years. The United States will step up as a reliable supplier.

In this era of risk management of the supply-chains, therefore, why not India seal a deal with the US, for a long-term supply, especially
now, when the US is surplus with oil, gas, shale -- and the American fossil fuel industry is hungry for international markets?

A long-term contract, hedging the risks, sounds logical for India. Makes sense for America. India needs to lock in energy security -- fossil
fuel based. Will also be good for the United States, and for Trump. If an announcement of a few billion dollars investment into the US
economy is made by an Indian entity, it will help Trump to tell the American public that he is attracting FDI, investments, and creation of
jobs in the US.

Technically speaking the Indian FDI into America may be made by one of India's top oil and gas companies, in the public sector, say, an
ONGC Videsh, or GAIL, or a private sector company like a Petronet. There are already reports that Indian gas importer Petronet LNG
has signed an initial agreement with Tellurian Inc of Texas, to invest in its proposed Driftwood project in Louisiana, and buy liquefied
natural gas (LNG) for deliveries to India.

Irrespective of the investment vehicle from India, the news that should come out of Houston should be that India has sealed a deal to
invest $X billion, into the American market. The US networks, broadcast media shall carry this news. Done, and dusted.

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9/21/2019 Houston event: Why India may announce big FDI into America - The Economic Times

So, how shall September 22 play out in Houston? Again, going out on a limb -- your author speculates as follows. The American CEOs
roundtable at Houston, with Modi, will be held early morning of September 22, say over a breakfast meet, 8 a.m. to 9 a.m. Then, next
the Modi-Trump summit will be held, say 9.30 a.m. to 10.30 a.m.

Thereafter, having sealed the deals, Modi and Trump will together arrive in the "Beast", to the NRG stadium filled with over 50,000, amid
roars as they both walk in. At the event, they will jointly announce what they have accomplished in their morning meetings before
coming to this celebration.

Icing on the cake? Trump will announce that he has accepted Modi's invitation to visit India as Chief Guest to the Republic Day Parade
on January 26, 2020.

Let the drums roll.

(The writer is the President of The Imagindia Institute)

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