Search the Internet          Tips  Sites: Finance, Investment

'US investments darkened by Enron shadow'

The serious problems faced by US multinational investors in the Indian power sector, including those with the Dabhol power plant in Maharashtra, have 'darkened the scope for foreign investment in the country'.

"I want to be frank. There is no doubt that problems in the Indian energy sector have put American investment in India in a shadow," US Ambassador to India Robert D Blackwill told reporters after his speech on The future of US-India relations at a function in Bombay on Thursday.

He said the ongoing disputes in India's power sector had darkened investment climate and the US was looking forward for 'an equitable solution among all parties to this issue soon'.

"I know this personally from speaking with some of the premier American business executives with major investments in India," Blackwill said in his luncheon address.

Reiterating US trade representative Robert Zoellick's statement, the ambassador said, "capital is coward. It seeks a home where the regulatory environment is transparent, predictable and fair, and the political and economic risks are reasonable."

When enquired about the possibility of US repealing its economic sanctions on India, the ambassador said the Bush administration would continue to consult with the Congress on the waiver of the 1998 sanctions.

US energy major Enron's Dabhol Power Company, which is locked in a $64 million payment battle with Maharashtra State Electricity Board, has already offered to exit the 2,184-mw project for $1 billion 'at cost'.

Tell us what you think of this report