[co-authors: Srinath Dasari, Vaidhyanadhan Iyer, Zia Mody, Anand Shah, Shreya Rao]*
1. What is the current business climate in your jurisdiction including major political, economic and/or legal activities on the horizon in your country that could have a big impact on businesses?
The Indian economy is gradually recovering from the impact of the second wave of COVID-19, supported by several government policy measures, targeted fiscal relief and rapid rolling out of the vaccine across the country. The Indian Government has undertaken several measures to strengthen the economy through a combination of short-term, medium-term, and long-term measures and as part of its recent budget has introduced programs to address various economy-related challenges by raising FDI limits across key sectors, launching the Production Linked Incentive (PLI) scheme that offers incentives on incremental sales for products manufactured in India and expanding the National Infrastructure Pipeline (NIP) project to attract investment in India. The Private Equity and Venture Capital sector doubled in value by recording investments worth USD 20 Billion in the initial five months of 2021 in comparison to 2020.
2. From what countries do you see the most inbound investment? What about outbound?
Inbound Investment: USA, UK, and Singapore
Outbound Investment: Mauritius, Singapore, British Virgin Islands, and the Netherlands
3. In what industries/sectors are you seeing the most opportunity for foreign investment?
Service, Computer Hardware & Software, IT, Telecom, Chemicals, Pharma and Automobiles
4. What advantages and pitfalls should others know about doing business in your country?
- Business reforms & government initiatives
- Attractive consumer market
- Digital technology & innovation powerhouse
- Low operational cost
- Complicated tax system
5. What is one cultural fact or custom about your country that others should know when doing business there?
India is a multilingual and multicultural society with notable nuances in ethnicity and culture. Great reliance is placed on cultivating and building long-term business relationships.
*AZB & Partners