Infrastructure problems and procedural delays remain major concerns for the foreign companies operating in India, according to the latest report by the FICCI.

“86 percent of the respondents have expressed dissatisfaction with regard to quality and quantity of power made available to them, about 75 percent have rated the quality of roads and highways in the country as ‘bad’. 68 percent have complained about availability of water for their operations,” said FICCI foreign direct investment survey 2010 released on Monday.

According to report, “A very high proportion of firms pointed out ‘procedural delays’ at the ground level as a major problem area and highlighted the need for carrying out ‘reforms at the state level’ so that the ease of doing business can be enhanced.”  

The foreign companies concerns bolster prime minister Manmohan Singh and finance minister Pranab Mukherjee's insistence in recent months on the need for more investments in the infrastructure sector in the country to maintain growth. India is eyeing $1 trillion in investments in infrastructure projects during the next five-year plan beginning 2012.

The report also noted, “Nearly 70 per cent of the surveyed firms have rated efforts made by the government for providing standardised investment information and proactive marketing as just about ‘average’.”

The report also mentioned that recent developments in China can increase foreign direct investment (FDI) in India. “The recent developments that have taken place in China — a series of strikes affecting operation of select MNCs, subsequent wage hikes, expectation about appreciation of the yuan and efforts to recalibrate growth strategy away from exports towards domestic demand — could lessen its attractiveness as an investment destination,” the survey added.

According to the study, “Gujarat has been ranked as the most attractive investment destination within India.”