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Luxembourg investment funds looking for funding proposals from Indian firms

Chennai, February 7, 2012. The scope of investment funds from Luxembourg is huge, sky is the limit for Indian companies and India should have a much bigger share in the Luxembourg capital and investment funds than the Euro 45 billion so far, Mr Gaston Stronck, Ambassador of Luxembourg to India, said here on Tuesday.

Luxembourg has huge capital fund for investment across the globe. “If the Indian partners have best possible proposals, and ensure legal and financial security fund managers and investors will be very glad to invest in India’’, he said in an interactive session with the members of the Confederation of Indian Industry (CII).

As a supplementary to the Ambassador’s statement, Mr Ambi Venkataraman, Honorary Consul General of India in Luxembourg, said that 45% of India’s FDI in 2010 was from Mauritius and very little from Luxembourg which has investment funds worth over euro 2000 billion.”The scope of funds for India from Luxembourg is great’’, he said. In order to create awareness among Indian companies about the importance of fund management through Luxembourg, the Association of Fund Industry in Luxembourg (AFIL) and Luxembourg Finance would be holding road shows in major Indian cities shortly, Mr Venkataraman said.

luxembourg investment

Luxembourg Investment Funds

The Ambassador said there were 210 country funds for India and 44 promoters of country funds for India in Luxembourg. Already 150 Indian companies were listed on the Luxembourg Stock Exchange. Indian companies could access foreign capital markets by setting up an investment fund in Luxembourg individually or as a consortium, he said.

Luxembourg was also a good place to manage acquisitions. “Legal framework is good and financial support is easy to come’’, the Ambassador said.

Mr Stronck said, “Luxembourg is much more than a finance centre, it is a diversified and dynamic economy’’, with industries, especially steel, media and E-Commerce, Logistics and Services sectors. Almost all the world leaders, in each of these sectors, including Indian companies, were active in Luxembourg, he said.

However he presented four business cases tailored to suit the needs of India. Luxembourg could be the gateway to Europe or to the world, it was the best place to manage intellectual property (IP), enhance research and development works and organize European logistics.

He said custom-made R & D infrastructure in the public the sector was available in Luxembourg. There are private R & D centers in automotive, materials, industrial and new technologies. Investment support from the government was open and transparent.

For logistics, he said, Luxembourg has the 5th largest European airport for freight traffic and was in very good complementary position with Chennai.

He said incorporating a company in Luxembourg was “easy and straightforward and can be completed in a couple of days. There are investment tax credits, losses can be carried forward, tax consolidation is possible for all Luxembourg companies , there is double taxation avoidance agreement with India and above all the availability of very fine venture capital and investment funds’’.

Technology from Luxembourg was available for steel, car components, space research and certain areas of ICT. He said in engineering and ICT collaboration “possibilities are unlimited- sky is the limit’’. Lot of companies would be looking for partners to do works that would be very costly in Europe mainly owing to high wage bill.

The Ambassador said Luxembourg would open shortly a visa facilitation wing in South India.

Mr Jhangoo Daruwalla, Honorary Consul of Luxembourg for South India, said Luxembourg has a stable and business-friendly government and a customer- friendly environment. For investment funds the country was the number two in the world and number one in Europe.

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