Why Invest In India?
The Indian economy has witnessed a paradigm shift since the last decade and is on a robust growth trajectory. Today, the Indian economy boasts a stable annual growth rate, booming capital markets, and rising foreign exchange reserves.
According to the Asian Development Bank's (ADB) report titled “Asia Capital Markets Monitor”, the equity market in India, with a market capitalization of approximately US$ 600 billion, has emerged as the third-largest equity market, behind China and Hong Kong, in the emerging Asian region.Democracy, demographics, domestic investments, and ease of doing business will drive India forward for the next decade.
10 Reasons to Invest in India
India is an internally driven economy fueled by domestic consumption and investment. Unlike many other emerging economies, India has a positive macroeconomic environment: inflation is under control, and it has record high foreign exchange reserves and a tamed current account deficit – thus reducing vulnerability to global economic shocks.
As a major importer of commodities, India has benefited from the decline of commodity prices.
As the largest democracy in the world, India also boasts segregation of power, enshrining the rule of law and an independent judiciary, ensuring no governing body enjoys excess power.
The stable and reform-focused Modi Government along with a credible central bank are implementing the next generation reforms. These include encouraging manufacturing with its “Make in India” initiative, and the much awaited goods and services tax reforms.
India is one of the fastest growing major economies in the world, growing at over 7%. It has emerged as a key investment destination for foreign investors who are looking to participate in the India growth story.
India has proved that industrialization along with the export of commodities and resources is not the only path to rapid economic development. India’s strongest exports lie in the services sector (making up over 58% of India’s economy in 2015, particularly in knowledge-based services like IT, pharmaceuticals, and engineering goods.
India’s population is not only one of the largest in the world, but is also one of the youngest. Two-thirds of its population is under 35 , giving the country a significant edge in terms of cost competitiveness through low labor costs. In addition, it has a significant English-speaking population, making it a top destination for multinational corporations looking to expand overseas operations.
Consumer spending in India is growing rapidly, from US$549 billion to US$1.06 trillion between 2006 and 2011. This has put India on the path to becoming one of the world’s largest consumer markets by 2025. India’s consumption is expected to rise 7.3% annually over the next 20 years. By 2040, nine out of every 10 Indians will belong to “the global middle class”.
An equity culture and high standards of corporate governance are highly entrenched. India has one of the oldest stock exchanges in Asia and ranks eighth in terms of “protecting minority investors” according to the World Bank.
India boasts well-developed capital markets supported by a robust banking system. Investors have wide variety of sectors in which to invest, such as technology, consumers, financials, commodities, infrastructure, and pharmaceuticals.