WHY INDIA | WarpDrive Group

As a fast-growing nation that also ranks as the world's largest democracy, India is an intriguing market for overseas businesses and investors. In recent years, the country — which has a population of more than a billion — has seen a surge in economic growth and now ranks as the world’s fifth-largest economy by GDP. Indeed, India’s GDP growth is the highest in the world in the past decade, regularly achieving annual growth rates of between 6-7%.

Real challenges remain for those seeking to do business in the country. In order to successfully navigate these challenges, it's essential to plan strategically, perform due diligence, and exhibit patience and commitment to the process.

Reasons for Doing Business in India

One of the world's fastest-growing economies

India’s economic growth has been exceptional in recent years. Buoyed by a robust democracy, key structural reforms, private consumption, and a rise in government investment, India has achieved a high macroeconomic stability ranking (with a score of 90 out of 100 and ranked 41 out of 141 economies) in the World Economic Forum’s (WEF) Global Competitiveness Index.
India attracted the highest ever FDI inflow of $67.54 bn during the first ninth months (Apr-Dec 2020) of the financial year 2020-21.

Rising Global Competitiveness

In a bid to attract foreign investment, the Indian government has eased foreign direct investment (FDI) restrictions, such as raising foreign equity caps for insurance and defence, leading to significant progress in terms of improving its overall business environment. As a result, the country has jumped 14 places to 63rd position on the World Bank's Ease of Doing Business 2020 study.

Goods and Services Tax (GST), the biggest tax reforms since independence, paves way for a common national market by integrating various indirect taxes.
India jumps 4 positions and ranks 48th in the Global Innovation Index 2020 rankings and ranks #1 in the Central and Southern Asia Region.
Centre of global maritime trade to move from the Pacific to the Indian Ocean Region. India and China will be the largest manufacturing hubs of the world by 2030.

Digital competitiveness

India has become a powerhouse in terms of technology innovation. High-tech companies in sectors such as telecommunications, information technology, pharmaceuticals, textiles, and engineering are equal in their sophistication and prominence to international counterparts. The IT industry is the largest employer within the private sector, employing 3.9 million people. India is transforming into a digital economy with over 450 million plus internet subscribers only second to China.

Key growth drivers include:

Widespread identity formalisation (Aadhar): 1.2 bn enrolments
The National Optical Fibre Network (NOFN) which aims to connect all 250,000 Gram Panchayats (village council) in the country with high-speed broadband.
Key government initiatives such as UPI and Digital India
High smartphone penetration: 1.2 bn mobile subscribers

Massive consumer market

India has a large and healthy middle class, making it an attractive consumer market. Indeed, India is the world’s largest market for manufactured goods and services, and ranks number 3 out of 141 economies for market size according to the WEF’s Global Competitiveness Index.

That market is only anticipated to grow. The WEF estimates that India’s total consumption expenditure will grow to $5.7-6 trillion by 2030. According to United Nations Population Fund, India has the largest ever adolescent and youth population and it will continue to have one of the youngest populations in the world till 2030.