Roll Up, India’s Open for Business

Context: As global liquidity, ravaged with low or negative yields, searches for a home, there is no better investment destination than India. 

Challenges to investments in India

• Geopolitical realities

• Need of the country to diversify its holdings the not naturally correlated with its own economic endowment (oil, technology and trade)
• Huge liabilities in the form of Pension Funds remain at risk.
• Low interest returns: around the world impact the bond yield and thereby the central bank’s profits.

Indian as the investment destination: Opportunities – 

• The vision of a $5 trillion economy: A fast-growing economy requires concomitant investment across infrastructure, manufacturing and services.
• Growing Infrastructure sector: Several enabling investment structures include:

• Infrastructure Investment Trusts, 
• Toll- Operate-Transfer (TOT) and Hybrid Annuity Models, 
• The National Investment and Infrastructure Fund (NIIF) 

• Large ecosystem of start-ups: across consumer-tech, fintech, health tech, EdTech; Supply chains designed to take advantage of resource availability, customer proximity and cost arbitrage.
• Ease of doing business: ensured through the rule of law, the sanctity of contracts, fair market practices and equal access to opportunities.

• For, E.g. the government has instituted Production-Linked Incentive (PLI) scheme for businesses that are willing to set up large-scale manufacturing facilities in India.
• Continued philosophy of an open dialogue: The finance ministry and NIIF hosted the Virtual Global Investor Roundtable (VGIR) 2020 conference to discuss ways and means to grow inbound investment into the country.

Conclusion: A stable political environment, a reform-oriented and investor-friendly government, a large domestic market and immense opportunities across infrastructure, consumer and industrial sectors create a perfect confluence for a long, and mutually beneficial, partnership between India and the world.