Pravasi Bandhu Welfare Trust
Post Box No. 940, Sharjah
Email: kvshams@gmail.com
Tel: +971506467801
February 23, 2007
PRESS RELEASE
INTRODUCE INFRASTRUCTURE BOND FOR NRKs
We came to understand from the media that Government of Kerala floated a new company called Infrastructure Kerala Limited (InKel), to channelise investments from non resident Keralites (NRKs) with a paid up capital of Rs. I billion out of that 26 percent stake would be held by Kerala Government. NRKs had supported and invested in more than two dozen Kerala Government promoted companies since 1976.
NRKs had very bad experience in investing in companies fully or jointly promoted by Government of Kerala. The first company NRKs had invested was Keltron Component Complex Ltd year back 1976. Keltron Component Complex Ltd had paid its first and last dividend after 11 years where as Cochin International Airport Ltd made its maiden dividend after eight years. Most of the companies are disappeared with total loss of capital. Notably majority of the investors in these companies are low and middle income NRKs, all of them had invested their hard earned money expecting some return form the investment. Ninety five percent of NRKs from this segment are not having financial resources to get a regular income for their lively hood when they return for permanent settlement. If such investors are not getting any return on the investment or totally loosing their investment is not affordable to them. In addition to that among State-level public sector enterprises (SLPEs) in Kerala 49 enterprises incurred losses amounting to Rs 501.50 crore during the 2004-2005. So, NRKs who knows the past experience in investing in Kerala based companies will not invest again.
If government is really looking for financial participation of NRK in the development of Kerala, the newly set up InKel must have a professional management and that company must raise fund by long term bonds in the line of Konkan Railway or Naiveli Lignite or Narmada Sarovar Nigam who raised fund for their project as Bonds. a) The return of these bonds must be higher than NRE bank deposits. b) Such bonds must have guarantee from the federal government on timely payment of the offered return to the investors because state had defaulted earlier.
During the regime of E K Nayanar Government of Kerala made attempt to raise fund from the public for infrastructure development. Instead of using that fund for infrastructure development the government diverted Rs. 5 billion into pay salary of the employees. Since the financial situation of the state is still bad, how we could believe that this government will use this fund for the infrastructure development?
A large number of Gulf returnees are now demanding for the government help for their rehabilitation. A government who has more 3.9 million jobless people in the state will not help them. Kerala had received more than Rs. 22,000 crores last years as remittance from NRKs. If government could mobilize 10% of the yearly remittance for the infrastructure and industrial development of the Kerala, we could change the face of Kerala. In addition to that the income from such investment will be a shelter for thousands of NRKs for their resettlement.
For More details, please contact:
K.V Shamsudheen
Chairman
Pravasi Bandhu Welfare Trust
Overseas Contact: Post Box No. 940
Sharjah, United Arab Emirates
Tel: 00971506467801
Email: kvshams@gmail.com
www.pravasibandhu.com
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