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Why Should Global Firms Keep Investing in India?

 

India has always been at the center stage of the debate: Is India a good investment opportunity? As many as unfavorable factors have been pointed out by investment gurus, there are even more arguments in favor of investment in India. Rising income inequality, joblessness, bureaucratic process, corruption, among others have always been the reasons global firms have shied away from entering the Indian market. However, the improvement in India’s ranking in Ease of Doing Business from 100 in 2017 to 77 in 2018 is a big indicator of improving the situation and reducing barriers of doing business in India. Consulting companies like Tecnova, the India Management Consultant make it easier for global giants to set up and establish them business in india, hitting the continuously growing Indian market while building a successful market entry strategy. 

No matter what the critics may say, there are at least three reasons which can’t be overlooked by global firms. 

  • Growth in infrastructure spending: 
The country’s spend on infrastructure has been increasing over the past few years. The announcement by the government to develop 100 smart cities, initiatives to build bullet train and national highways has led to an increase in spending on infrastructure. During the past years, the government has made significant investments in infrastructure. In terms of developing energy resources, the country has been increasing the spend on renewable energy sources. Since 2014, India has expanded its solar generating capacity to eightfold and reached its target of 20GW capacity four years ahead of schedule. 

India needs around $5 Trillion in infrastructure investment to sustain its economic growth; however, Indian companies lack the requisite technical competence to develop the high-tech industry. This helps India Management Consultant provide a very lucrative opportunity for global high-tech and manufacturing companies to set up base in India. 

  • Emerging Middle Class is Strong: 
India’s middle class has been emerging at a steady pace over the years. This growth in middle class provides more disposable income with people to increase discretionary spend. Even though India possesses certain challenges in setting up business in the country, this strong middle class has led to some great success stories in the past decade. The success of Hyundai, LG, Samsung, and Xiaomi are examples of strong growth led by the increasing middle class, strong enough to overcome the bureaucratic challenges of setting up business. The success of Amazon is another example. 
The reason for the success of these companies in India has been majorly for three reasons. First is long-term commitment to the market. These companies have been in India for long-time and focused on setting up business in India. Second is their strategy to build local teams, teams that can communicate with the market in their way and in their language. The third is their focus on customization – customization of products or business models to suit the Indian market and Indian consumers. 

  • The emergence of Tech Startup Boom: 
India offers one of the world’s richest tech startup space for global companies to come and be a part of the ecosystem. India houses a few of the world’s largest software services companies. Moreover, in recent years the emergence of tech companies has created another opportunity for investors across the world. Tech startups have attracted over $20 billion in past three years. 
Government is helping these companies to create an ecosystem to host some of the most innovative companies in the world. The Consulting companies in India are building a better market entry strategy for the global giants to help them set up their business in India. Tech volunteers and the Government agencies have joined hands to create ‘India Stack’, that gives governments, businesses, startups, and developersa set of APIs, a common digital infrastructure which helps them build and deliver presence-less, paperless and cashless services. 

In conclusion, India provides a plethora of opportunities for companies and investors across the globe, but those opportunities come with their own set of challenges. Companies who have committed themselves to the market have been able to make a mark in the country and have been successful in overcoming the hurdles. This shows us that the prize for companies to overcome these challenges is huge and can be worthwhile to be considered in their overall growth strategy.  

Website: www.tecnovaglobal.com 

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