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Why Businesses Are Looking To Indian Investments

The first decade of the New Economy has witnessed a spate of Companies Investing in India. Today, Indian market is witnessing the upswing in Private Firms and Companies Investing in India. The reasons for this are many, but we will focus on three main ones – an improving economy, greater access to international talent, and better infrastructure.

There are more than 75 American companies with Indian investors that are focused in the consumer packaged goods, e-commerce, telecoms, online grocery, social media, internet banking, logistics and vertical products sector, as per their October 2021 report. As China becomes one of the fastest growing markets for global products, the presence of Chinese firms in the Indian market has become increasingly important. Most of the private American investors are attracted by the country’s potential for growth in information technology and its burgeoning economy. These firms see great potential in India as an important market for outsourcing to Asian countries.

Indian labor laws are pro-American and have encouraged private American investors in recent times. They are attracted to the country’s talent pool, skilled local population, low cost of living, liberalization of business laws, comparatively low corruption levels, and an opportunity to capitalise on the country’s massive pool of talented and skilled professionals. Companies like ABB, Schlumberger, P&G, Cargil, IBM, Pricewaterhouse Coopers, Apple, GE, Ford Motors, Citi Group, Microsoft, Wal-mart, Unilever, World Wide Brands, Daewoo, Hainan Airlines, Hyundai and others are investing in India. Indian labor laws are pro-American and have encouraged American investors in recent times. They are attracted to the country’s talent pool, skilled local population, low cost of living, liberalization of business laws, comparatively low corruption levels, and an opportunity to capitalise on the country’s massive pool of talented and skilled professionals.

The government securities markets in India have a lot of attraction to US companies looking to make investments. The Indian government securities markets have a lot of attraction to American companies looking to make investments. The government securities markets have a lot of attraction to American companies looking to make investments. Government securities can be invested in almost any form: stock, securities, corporate bonds, commercial papers, etc. There are opportunities galore for small investors. There are government securities markets which attract both foreign direct investment (DFI) and domestic direct investment (DDI).

There are some advantages of investing in Indian government securities: they are rated higher than their counterparts in Europe and elsewhere in the world; they have less taxation and less statutory duties on them; and they are backed by a stable and willing government. The downside of these is that the strength and longevity of the Indian dollar against the USD and other currencies is dependent on the fiscal health of the country. The currency value of the Rupee is also affected by the economy of the country. If the Rupee’s value depreciates, then American and European investors would lose out, whereas, if the Rupee’s value increases, then Indian investors would gain from their portfolios.

There are many ways in which domestic funds can be invested in India. They can be invested in domestic financial instruments like government bonds, corporate bonds, commercial paper, and preference shares. Another source of foreign direct investment (FDI) can be in infrastructure projects like construction of roads, dams, bridges, airports, and so on. Or it can also involve gold mining, and oil exploration. Another way of looking at it is that whatever is done in India has an impact on foreign direct investment in India.

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