INDIAN ECONOMY : ONE OF THE MOST ATTRACTIVE ECONOMIES

 Indian economy is one of the most attractive destinations for the business investments which look for large manpower base and diversified availability of resources and macroeconomic factors. With the Indian economy growing at a good pace and holding a strong position it has acted as one of the most attractive economies in the world. India’s economy is among one of the largest economy in the world with respect to purchasing power parity (PPP). If we look in the past India has attracted foreign direct investment worth 30.82 billion US $ while the FDI equity inflows during January 2013 stood at US $ 2.16 BILLION according to the data released by the department of Industrial Policy and Promotion(DIPP).

If we compare India with other countries, India has stood as the third most attractive destination for FDI in the world. India has a significant potential and a favorable business environment for foreign investors according to the reports of World Investment Prospects Survey 2012-2014 by UNCTAD.

SOME FACTS ABOUT INDIAN ECONOMY

• According to Mr. Ben Bernanke, Chairman, US Federal Reserve it is very necessary to exchange ideas and build the basis for future collaboration. India is a growing economy and is becoming an important player on the world stage in terms of its role in global economy.
• According to Grant Thornton Global Dynamism Index India is the fifth best country in the world for dynamic growing businesses. The index shows a reflection of a suitable environment India offers for dynamic businesses.
• According to the ‘Ipsos Economic Pulse of the World’ survey India’s economic confidence registered a growth of 8 points, and reached 68 per cent making it fourth most economically confident country in the world.
• As per Deloitte Touche Tohmatsu Ltd (Deloitte) India is also expected to be the second largest manufacturing country in the world in the coming next three years, followed by Brazil as the third ranked country.

RECENT GOVERNMENT INITIATIVES

• India’s Foreign Direct Investment (FDI) policy has been gradually relaxed to attract more foreign investors. The results showed up a positive change. Today, the country is consistently ranked among the top three global investment destinations by almost all international bodies, including the World Bank, according to a United Nations (UN) report.
• India and UAE has recently signed an agreement to promote collaboration in renewable energy, focusing in the areas of wind power and solar energy. A Memorandum of Understanding (MoU) was signed by Dr Farooq Abdullah, Minister of New and Renewable Energy of India and Dr Sultan Ahmed Al Jaber, Minister of State of UAE in Abu Dhabi on January 18, 2014.

 

KEY SECTORS IN INDIA WHERE FOREIGN INVESTORS CAN INVEST

India a trillion dollar economy with a self sufficient agricultural sector, a varied industrial base and a strong and well established financial sector with a continuously developing services sector has numerous sectors that can provide lucrative business opportunities to the foreign investors.

India is continuously talking on policies to attract foreign investors, initiated by high profile visits in order to initiate and build a long and lucrative means of economic cooperation with the developed countries.

The list of sectors that can be seen as good opportunities by the foreign investors:

1. SOFTWARE

India’s software and service sector is continuously seeing a positive growth with a large no. of engineer minds continuously entering into this sector. India software and service exports are likely to increase with projected export revenue at 13-15%. With one of the largest pool of engineers available in India investors have high targets in hardware and software development.

2. TOURISM

One of the booming industries in India is Tourism. India is noticing a rising number of domestic and international tourists every year. Tourism can be one of the sectors that can attract the foreign investors and is really hot nowadays. India with its diverse culture, rich heritage has been a tourist attracted destination since a long time.

3. AUTOMOBILE

A growing hotspot for automobile industry is what India is looked as. India can also acts as a cost effective hub for auto components sourcing for global market. With a pool of cheap and easily available labor and growing technology the automotive sector is potential business in India for foreign investors.

4. TEXTILES

India having known for textile since centuries because of its unique style of apparels in each state has huge potential for business investments. India can act as a preferred location looking upon the growing demand of garments. Many states of India such as Tripura and Ludhiana are now export hubs for textile. Although some sort of better understanding of the market and customers is still needed and can boost growth in this sector and attract direct investment.

5. EDUCATION AND TRAINING

A good demand in this sector can be a reason for the interest of the foreign players. With a large percentage of population lacking good education is being counted under unskilled workers. A need for education and training can be clearly identified. Providing education and training would convert this unskilled labor into skilled and can be used in a better manner.Besides this with good facilities at competitive rates, unique method of teaching and betterment in some aspects of the education system in India can attract a large student population from abroad.

Besides these sectors other sectors such as real estate, Retail, Power and biotechnology can also be the sectors of foreign investors’ interest.