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India, Opening Up New Markets for Global Enterprises

India, Opening Up New Markets for Global Enterprises

India is emerging as a favored economic and geopolitical partner for many international brands looking to expand their footprints in new markets. This major geopolitical repositioning has been attributed to – the abated trade relations between the US and China, the fallout of the COVID pandemic, the ruling government’s change in accommodating policy for foreign investors, and its growing level of comfort in increasing strategic co-operation with countries across the world.

India today is no more an ally of the US alone. Over the past decade, thanks to the efforts of external affairs and diplomacy, we have developed with a wide range of countries worldwide.

Many global enterprises, either big or small are increasingly considering India for manufacturing their product lines, collaborating with healthcare companies to develop drugs, outsourcing their IT requirement, offshore knowledge-based key jobs, and so on. The inflow of this global investment will have an impact on various sectors in India in the coming years.

Investing in India has Unique Advantages

India has a huge pool of skilled manpower with the finest work ethics, which global enterprises can tap on. Also, India with its open regulatory environment makes it an attractive destination for enterprises looking to set up a Manufacturing, R&D, IT, Pharma, Energy, Consumer goods, Retail business in a new market and create sustainable success.

In March’20, the government in order to boost domestic manufacturing and attract investments in the electronic manufacturing segment launched a PLI (production-linked incentive) scheme. This scheme extended an incentive to 6 percent to eligible companies on incremental sales of goods manufactured in India.

Favourable Policies for International Players 

Moreover, liberalized FDI regulations, reduction in corporate tax, set-up of the e-Biz portal for businesses to file all the necessary documents online and enhancement of the validity of the industrial licenses from two years to three years has served as an impetus for businesses to set-up their units in India.

The inception of the Insolvency & Bankruptcy Code (IBC) was also developed to safeguard the rights of international businesses. The Commercial Courts and Commercial Divisions of the High Courts, which were set up, post the landmark enactment by the Indian Parliament in 2015 to expedite legal discourse has led to an improvement in investor confidence.

With Public Procurement-Preference to Make in India, that requires a minimum of 20% domestic value addition, it is noteworthy that most foreign suppliers have tied up with Indian organizations and provided them with business support.

Employment Opportunities across Industries

The set-up of National Investment and Manufacturing Zones (NIMZ) and cluster zones (industrial parks, food parks, etc.) in different parts of the country will attract more foreign investments and augment the manufacturing sector.  The Union Budget 2021 laid focus on growth of the manufacturing sector. The Finance Minister said that the PLI scheme aimed at creating global champions in manufacturing would further boost the various sectors including automobile, infrastructure and textile.

Extension of social security for contractual, gig and platform workers will channelize remote working. It will also help generate employment opportunities in Tier 2, 3 and 4 cities. The infrastructure sector, including roads, highways, shipping and Healthcare, Agriculture, Power etc. is likely to witness a major overhaul in terms of employment and development.

Thus, the sectors that will see a huge rise in volume jobs will be mobile manufacturing, automobile manufacturing, BPO and the government-led domestic infrastructure projects, while value-based job opportunities will continue to be in the digital economy, SaaS, IT, R&D, Defense manufacturing and Pharmaceuticals.

As economies continue to adjust to the new normal, it would be in the best interest of India to better align its perspectives and become a key stakeholder in the global business ecosystem over the next decade.

About the Author

Bhawna Agarwal, is the Founder & CEO, Chiexit/ Change Enhancers. Her consultancy service, Chiexit, assists companies in partnering with the best consultants and relocating to India and other booming international markets. Her initiatives advocate the Atmanirbhar Bharat initiative or self- reliant India.