Canada’s pension funds and banks are responding to positive changes in the Indian economic environment initiated by the Narendra Modi government, according to Finance Minister Arun Jaitley.
“I think there’s a huge change in perception” Jaitley told BloombergQuint, after meeting heads of leading pension funds and banks in Toronto on Monday.
It’s because of the very large appetite that India has shown for reforms. So not only the fact that there have been a series of decisions one after the other taken by the government, which have been implemented, there’s a lot more economic activity in India on the policy front, and that is getting much larger support across the political spectrum.Arun Jaitley, Finance Minister
Jaitley, who is on a three-day visit to Toronto, noted that Canadian investment in India had shown a significant increase. “In the last two years, about $12 billion has come in from the pension funds and other investors into India,” he said.
Canada’s pension funds are well-endowed, managing hundreds of billions of dollars. The country’s largest pension fund, Canadian Pension Plan Investment Board, alone manages nearly $220 billion, and has an exposure of over $2 billion to India. Indian officials said CPPIB and other pension funds had also shown interest in the newly created National Investment and Infrastructure Fund.
On Monday, Canada’s second biggest pension fund, the Caisse de Depot Quebec, or CDPQ, announced an investment of up to $700 million over the next four years in stressed assets and private debt opportunities in India in partnership with financial services firm Edelweiss Group.
While in Toronto, Jaitley also met with his Canadian counterpart Bill Morneau, and Canada’s Minister of International Trade, Chrystia Freeland. Jaitley said trade negotiators of both countries are likely to meet again soon to finalise the long delayed bilateral investment protection agreement.
Both sides (India and Canada) are very keen in finalising the investment agreement.Arun Jaitley, Finance Minister
Talks on the Comprehensive Economic Partnership Agreement are already three years behind schedule, even as bilateral trade stands at just over $8 billion, a little over half the target of $15 billion by 2015.
Jaitley will meet with more investors in Toronto on Tuesday before leaving for Washington DC on Wednesday to attend the IMF-World Bank annual meeting.
(Indira Kannan is an independent reporter and contributing journalist to BloombergQuint. This report first appeared on BloombergQuint.)