Canadian firms are increasingly focusing on India as an investment destination, with overall optimism about the entire Asian region on the rise, a new survey said.
According to the 2010 Asian Investment Intentions Survey released by the Asia-Pacific Foundation of Canada, Canadian firms are upbeat about investment opportunities in Asia.
"China may be the economic powerhouse of the region, but Canadian companies are increasingly eyeing the mounting investment opportunities in India," the report said.
There has been a strong rise in interest for investment in India, with 13 per cent of the Canadian companies surveyed favouring the country this year from just eight per cent in 2005, according to the report.
"While China remains the top investment market for Canadian companies, the economic might of the region as a whole is a growing reality that Canadian companies ought to explore and seize.
"The firms are slowly latching onto these investment opportunities, especially in growing economies in India and South-East Asia," APF Canada president and CEO Yuen Pau Woo said.
Woo said, "This growing interest in India is not surprising, with average real annual growth of 8.75 per cent over the 2003 to 2007 period, India is emerging as an economic heavyweight in the region."
China still remains the top investment market with 21.1 per cent of Canadian firms choosing it, while 13.4 per cent opted for India, 9.9 per cent for South Korea and 9.2 per cent for Japan, the survey noted.
Despite the constraints of the recent financial crisis, over 50 per cent of the over 500 Canadian companies surveyed saw no impact on their Asian operations during the crisis. Interestingly, nearly 60 per cent of the respondents saw an increase in revenue from Asian operations over the period of the crisis, it said.
Further, Canadian companies remained generally confident about a long-term increase in their level of investment in Asia.
Some 55 per cent of the companies are recognising the shift of opportunity to service the growing markets in Asia, up five per cent from 2008, the survey found.
The Vancouver-based Asia-Pacific Foundation of Canada is an independent, not-for-profit think-tank on Canada's relations with Asia.
