EEPC chairman Rakesh Shah in Calcutta on Wednesday. Picture by Kishor Roy Chowdhury

Calcutta, May 3: India is emerging as the preferred destination over China for German investors. Foreign direct investment (FDI) from Germany is expected to double in the next three years.

India has attracted $1.56 billion FDI from Germany from 1990 to January 2006.

“India has emerged as the preferred destination for investors at the Hannover Messe because of the satisfaction level of the existing German players in India and the country’s transparent legal system, especially regarding intellectual property rights (IPR),” said Rakesh Shah, chairman of Engineering Export Promotion Council (EEPC).

Investors also perceive India as the gateway to the Asean market.

Shah said two states ? Bengal and Gujarat ? stood out for their proactive endeavour in attracting investments from Germany. Apart from participating in the fair, the representatives of the two states met various chambers of commerce in Germany.

Gujarat, however, had a slight edge over Bengal due to its labour reforms initiatives.

The Germans are also keen on special economic zones (SEZs) and Bengal has projected its upcoming foundry park for investments in castings and forging. However, potential investors are concerned about the infrastructure in the state, even though this area was projected as an investment opportunity.

The current export of engineering items to Germany is $545 million, which is expected to become $1,090 million over the next three years, Shah said.

The EEPC has also identified a German partner for Mahindra & Mahindra who is keen to explore opportunities in auto components in that country and might set up a unit there, Shah said.