Three reasons to do business in India
India is the second largest country in the world by population, the world’s largest democracy and the largest English speaking nation in the world. Recording an annual average growth rate of 7.5% from 2004 to 2013, India’s economy is now growing faster than China’s. The country’s economy is set to exceed the size of the UK economy in the next few years and is forecast to be the 7th largest economy in the world by 2019.
India’s new government is committed to pursue economic growth and steps by the NDA government such as the “Make in India”, “Digital India” “Skill India” and “Smart Cities” and various business friendly reforms have significantly created a positive business environment in the country. India’s growth is largely driven by domestic demand, fuelled by a rapidly growing middle class. It is an important market for UK goods and services, including consumer products.
There are three drivers for this growth:
With over 1.2 billion people, of whom 572 million are under the age of 24, India is currently the country with the biggest youth population in the world. Rising incomes and a greater exposure to Western lifestyles will also create inflexion points for various products and services, as previously unattainable purchases will become necessities. Both of these developments are likely to unleash a substantial shift in consumer spending and consumption patterns over the next two decades.
Combined with rising income levels and a growing middle-class, India matters and presents significant opportunities for UK businesses. Find out more
The current government’s reforms include greater co-operation between state and central governments. Co-operative federalism with the centre will be key in achieving India’s sustainable development and competition between states is likely to bring about greater efficiencies. Patterns of competitive federalism are already evident with many States doing their best to cut down on red tape and simplify compliance procedures to appear more business-friendly and attract investments.
In 2013-14, 24 of India’s 29 states grew at rates in excess of 5.5%, with the wealthiest one, Maharashtra (capital Mumbai), recording a growth rate of 7.3%. Some of India’s states such as Bihar, Madhya Pradesh, Meghalaya and Tripura recorded growth rates over 9%. The next round of economic growth will thus take place in India’s emerging states and cities, with rapid development in rural areas. Find out more.
There are opportunities in nearly every sector. However major shifts are underway in India driven by a series of strategic development initiatives including Make in India (MII), Digital India and Skill India. India’s development initiatives and rapid economic growth means growing opportunities in emerging sectors such as digital innovation, energy and sport to name a few. Find out more