Watsa plans to invest $7 billion more

Billionaire investor Prem Watsa proposes to have $7 billion more worth of investments in India over the next five years where he believes the country is in an "impressive" phase with the goal of 10% economic growth in front of it.

Hyderabad-born Watsa, often described as Canada's Warren Buffet, has built a diverse portfolio of investments in India spanning insurance, banking, chemicals, fintech, travel and shipping. He said those investments are worth $7 billion now and he intends to have a similar quantum as he continues to be bullish on the opportunity created by the Modi government here.

"India is on its way to a $5 trillion economy and then to $10 trillion. But most importantly, India has changed from a socialistic type of economy to a growth economy based on business," the chairman of almost $90-billion Toronto-headquartered Fairfax Financial Holdings told ET in two separate conversations over the past three weeks, the first of which took place during a two week-long visit to India in May. Watsa was here to review the company's business interests and also to meet with Prime Minister Narendra Modi.

Fairfax is eyeing investment opportunities that will emanate from the government's privatisation programme and is also looking at bringing companies from North America to India. Watsa hinted at possible investments in railway station modernisation as well but chose not to elaborate on those plans.

"We are just thinking how we can mobilise support for India in terms of investing a lot more by raising a lot more money. Not through Fairfax India as Fairfax India's stock is undervalued but we are looking at different ways of raising money," Watsa said.

When asked if the government's massive investment plan for logistics development was of interest to Fairfax, Watsa said "we are very close to Fedex and they are looking at India. So we are looking at it with them".

An alumnus of IIT-Madras, Watsa left India in 1972 because he said he couldn't find a job at the time. A self-confessed admirer of Prime Minister Modi, he believes India is going through an "amazing transformation" with opportunities being created for the average person through large welfare programmes of the government such as the opening of 400 million bank accounts and electrification of villages.

"Just in terms of pure economic policy for the average Indian, when he (Modi) got elected, there were something like 18,000 villages without electricity. They have all got electricity now. The scale of what the honourable PM has done is unbelievable," Watsa said.

Fairfax has investments in 18 companies in India. Prominent among those are Thomas Cook, Bangalore International Airport Limited, Digit Insurance, Quess Corp, CSB Bank and Chennai-based chemicals major Sanmar Group.

“India is coming back in spades. The economic growth is significant even in Canada, US and Europe. But India is coming back in a big way. Inflation and higher interest rates are small factors compared to the economic growth taking place,” Watsa said when asked if inflation could become an impediment to India’s economic prospects.

Fairfax will continue to look for good companies when it identifies investment opportunities here.

“India is the best place to invest. We have to invest in a way that’s good for everybody. Good for your employees, good for your customers, good for your shareholders. Our philosophy has always been that you have to invest a portion of your profits into charitable endeavours, which we have done by installing 1,200 dialysis machines for people that cannot afford them, and an investment in a hospital for sick children in partnership with CMC Vellore and Quess, along with many other initiatives. You have to give back to the community here,” he said.