Investment in India

Investing in India is a great prospect thanks to various economic reforms that have brought about a consistency in India’s economy.

Currently, India is ranked as 3rd in terms of the most preferred investment destination. Relaxed reforms in foreign direct investment both through direct automatic and approval routes along with release of the revised FDI policy have been eased and expedited the investment processes in India. Other factors that work in favour of India are its demographics, a suitable business climate, lower cost in terms of labour and availability of an overall high grade talent pool.

As per the advance estimate of GDP for 2009-2010 which was released by the central statistical organization, the economy is expected to continue to grow at 7.2% in 2012-2013. The industrial and service sectors are also expected to continue growing at 8.2 and 8.7% respectively. On an encouraging note, the Prime Minister has said that the growth could even exceed expectations by touch 9 % this fiscal. India’s GDP grew by 6% during October to December 2011 over the corresponding quarter of the previous year as per the data released by the CSO. 6 core infrastructure industries grew at 5.5% in February 2012 over the corresponding moth this year primarily due to a substantial increase in output of electricity.

Foreign institutional investors worth US$ 4.37 billion in equity and US$ 2.09 billion in debt instruments in the month of March 2011 according to the data released by Securities and Exchange Board of India.

The number of registered FIIs increased to 1713 on 31st March 2011 and the total FII inflow was during January to March 2011. The total came up to 4.54 billon US$ while the debt was around 4.71 billion US$.

As on March 26, 2011, India’s foreign exchange reserves totaled to US$ 277.04 billion, an increase of US$ 24.71 billion over the same period achieved last year. These statistics were supplied according to RBI’s India’s weekly supplement. Moreover, India has received a total FDI worth US$ 24.68 billion during the same period in April 2011 to February 2012 with FDI flow in India on February 2011 alone being US$ 1.72 billion. According to the department of industrial policy and promotion, the 6 infrastructure sectors – crude, petroleum refinery products, coal, electricity, cement and finished steel – constituted of 26.68 percent in index of industrial production.

This is a growth of 5.3% more as compared to last year and 2.9% growth in the same period in 2010. More than 200 companies from 50 countries form a part of the World Economics’ Forum’s Global Companies Community. India today has the second largest representation with a total of 18 GGCs. Indian GGCs arrive from every sector with a strong representation in Information Technology and electronics, retail consumer goods and banking.