All about- India Business

Taking the lead and fostering overall economic development – that is what India business has been targeting at for a long time. With the innumerable options of trade and business, high amount of volatility in the stock market, foreign investment flows in the country, the dollar getting over valued in terms of INR – could the India business scenario get more versatile? India definitely gives immense possibilities to everybody who wishes to start off a business here. But scouting the required opportunity and maximizing the utmost potential depends entirely on the investor.

India's rank in ease of doing business -

2006     116

2008     120

2009     132

2010    133

So, what is the underlying reason behind this decline in the position? Actually the number of countries that have been studied for determining this index have increased from 155 to 183 over the specified time period.

What steers the India Business?

Imports and exports form the core elements of India business. To substantiate the same, the figures of currents imports and exports are respectively, $287.5 billion and $175.7 billion. India mainly imports crude oil, machinery, gems, fertilizer and chemicals whereas its export basket includes petroleum products, textile goods, germs Jewelry, Engineering goods and chemicals. India has a lower dependency on exports to foster its growth – thus in a way the exposure to global demand shocks are limited. We all know that global financial shocks act as an impediment to the country's growth. To strengthen this position, the domestic institutions should have a stronger base.

On the other hand, Foreign Direct investments (FDI), institutional investors and external commercial borrowing (ECBs) should again be the main driving force behind India's business growth, but all these factors are let loose to some extent as of now. We need to understand that FDI would not only bring in money but also better management systems, enhanced corporate governance and new technologies – all helping together to drive India's business pattern.

Highlights of India's business scenario -

1. Massive young skilled work force, being cost effective, drives the production patterns in the country
2. Improvement in the infrastructure and intellectual capital
3. Progressive tax reforms
4. Leveraging the economy to FDI inflows and outflows – generating business in turn
5. Tailor made policies as per investor requirements.
6. Introducing the concept of Public private partnership (PPP)
7. More mergers and acquisitions to build brand value of the individual companies and in turn creating the India brand value.

A recent research states that the volume of mergers and acquisition In India witnessed a sharp nine times jump standing at US$ 2.27 billion during March 2009 against its volume of deals in February 2009.

Figures to prove India's healthy business status -

• India ranks 3rd in global foreign direct investments in 2009
• India would remain among top five attractive destinations for international investors in the next two years (UNCTAD report).
• FDI inflows to India stood at US$ 3.5 billion in July 2009, up by 56% from the value in July 2008.
• FDI equity inflows to the tune of US$ 10.532 billion came in India during April-July 2009.

So, with figures showing robust growth, statistics predicted to be only augmenting, India business surely has a lot more untapped potential, exploring which shall really make it the Asian Tiger.