Indian Prime Minister Narendra Modi, seen addressing an audience in Toronto on Wednesday, said he understands the need for predictability and consistency in government decisions and regulations.Fred Lum/The Globe and Mail
Indian Prime Minister Narendra Modi sought to convince the heads of pension funds, banks and a select group of business leaders in Toronto on Thursday that his government is cutting bureaucracy and making it easier to invest in India's rapidly growing economy.
Mr. Modi, who is in Canada this week for a long-anticipated three-day visit, held a breakfast roundtable with executives from Canada's largest pension plans, banks and insurance companies at Toronto's Four Seasons Hotel Thursday morning. He also met with another group that consisted of about 20 business executives and included Aecon Group Inc. chairman John Beck and BlackBerry Ltd. chief executive John Chen.
The Indian Prime Minister said he understands the need for predictability and consistency in government decisions and regulations. He also said his government has made changes since he was elected last year and suggested he was open to feedback from business leaders on what more India can do.
Several business leaders said they were impressed by the personal tone Mr. Modi took in addressing them and his interest in improving trade and investment ties with Canada. The Prime Minister addressed the executives in Hindi with the assistance of a translator. Canadian Prime Minister Stephen Harper was also present for the meeting.
"He was very appreciative of the welcome he's received here in Canada [and expressed] lots of optimism for future business," Tim Gitzel, CEO of Cameco Corp., said in an interview Thursday afternoon. Saskatchewan-based Cameco concluded a deal this week to supply India with hundreds of millions of dollars in uranium over the next five years.
Mr. Modi is seeking to promote foreign investment to fund infrastructure projects in India, including new transit lines and smarter cities with improved power and waste-collection systems. The push comes at a time when many institutional investors are looking to alternative asset classes for an opportunity to diversify their portfolios and produce long-term returns.
"I think his timing is impeccable given that interest rates have fallen and returns have fallen around the world," said Dean Connor, chief executive of Sun Life Financial Corp. Mr. Connor, who attended both Thursday morning meetings, said he was struck by the enormity of Mr. Modi's vision for growth and improvements in India. The insurer has a long history in India and re-entered the country's insurance and investments market in 1999 through a joint venture called Birla Sun Life.
Mark Wiseman, CEO of the Canada Pension Plan Investment Board, said India's market is particularly well-suited to long-term investors and noted that CPPIB has committed about $2-billion in capital to the country. "Our investment programs are well positioned today to take advantage of India's future growth and we will remain active with a view to the long-term returns we seek," he said.
Mr. Modi's meetings with business and financial leaders came one day after he delivered a major speech to thousands of Indo-Canadians at Toronto's Ricoh Coliseum, in which he promised to continue to tackle corruption and help make India more prosperous. He travelled to Vancouver on Thursday afternoon, where he stopped at Sikh and Hindu religious sites and attended an official dinner with Mr. Harper and other government officials.
Indian Finance Minster Arun Jaitley recently made comments about plans to tax foreign companies retroactively, which could dampen new investment in the country, according to Shilan Shah, economist at Capital Economics. Mr. Shah wrote in a note to clients that while the multibillion-dollar move could improve India's financial strength, "uncertainty caused by retrospectively taxing companies is likely to raise concern within the private sector." There was no mention of the tax in a recent budget, he said.
The heads of Bank of Nova Scotia and Royal Bank of Canada sat at the table in Mr. Modi's first meeting with banks, insurers and pension funds, along with Bank of Montreal's chairman. Four top-level executives from TD met with Mr. Modi on Thursday, including the bank's CEO, chairman and heads of investment banking and wholesale banking.
"Prime Minister Modi's decisive victory last year set the stage for many big changes," TD chief executive Bharat Masrani said during the meeting, according to a statement provided by the company. "Your government is breaking down barriers that impede growth, simplifying the way business is conducted and unlocking the energy and ingenuity of your people."