Uncertainties drive infra, power cos to foreign lands

On account of mounting uncertainties in acquiring land, getting projects cleared and financed and dwindling assurance on fuel supply, the infrastructure and power companies are scouring the global landscape for business projects more than ever.

India's largest engineering and construction company, Larsen & Toubro has already established offices in Russia, France, the UK and the US beyond the traditional Indian and West Asian markets. GMR Infrastructure is scouting for projects in South America, South East Asia and Africa.

Tata Power is scouring four new regions outside home — Africa, West Asia, South East Asia, including Indonesia, Burma and Vietnam, and America — as it aggressively chases projects to meet 2020 target.

"We may not be able to add much capacity here, owing to lack of clarity on fuel, or issues related to land and environmental clearances," said Tata Power managing director Anil Sardana in an interview with FE.

The company has established teams in all these four regions, in addition to its team in India & Saarc, to hunt for projects and investment opportunities. "They may take different shapes, like a JV or in partnership with someone who holds a licence. It might be a 100% investment by Tata Power or in the form of PPP with the government (like in India, Zambia)," said Sardana. "The vehicles to invest and progress will be different, but to build and possess the projects will be the objective."

L&T, which aims to double its sales to R1 lakh crore by 2017, has opened offices in Moscow, Kuala Lumpur, Indonesia, Milan, Paris, London, Houston and Turkey, as part of its internationalisation drive, and will soon open offices in Perth and Brazil.

"If you want to grow, you need to have speed; India alone will not help," AM Naik, L&T's chairman, had said in an earlier interview to FE. "We need to tap new territories, look at newer ways of doing business, find the appropriate leadership and get more local people." L&T is aiming to get 25% of revenues form overseas in five years.

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