Doubling Down On A Resilient India

The Hindu     22nd March 2021     Save    

Context: For leading companies with global ambitions, the rewards of investing in this complex country are worth pursuing

Scale of opportunities in India 

  • Rising FDI: India’s $60 billion­plus tally for new annual FDI equity inflows was its largest ever-overhaul.
  • Sheer demographics: Market of nearly 1.4 billion people and their growing purchasing power.
  • Shifting geopolitics: Rising U.S.-China competition redefining the global landscape for investment and manufacturing.
  • Rising digital connectivity: 700 million Indians already connected to the internet, opportunity to connect 500 million ‘next-gen netizens’ to internet.
  • National resilience: Inspiration to tackle 21st-century challenges- Despite facing the scourge of coronavirus, India managed the pandemic well and restored economic activity even before the mass vaccination programme.

Challenges to FDI:

  • Skewed investments: A signi?cant share of India’s FDI in?ows arose from foreign investments directed solely at Reliance Jio. 
  • Lagging in FDI as compared to peers: India’s latest FDI totals still lags behind the highest tallies in other markets such as China and Brazil. 
  • Complex and challenging place to do business: Frequent shifts in the policy landscape and persistent market access barriers are standard complaints.
  • Self-reliant India: Government’s push to build a “self­reliant” India has also rattled skittish investors and smaller companies that lack the resources.

Way forward

  • Value creation: At the heart of their business strategy of companies.
  • Tie corporate success to India’s growth and development: Eg. Invest in Indian talent, align products with Indian tastes etc.