Investment Opportunities in India

September 21, 2011

FDI: The current trend of investments

When we discuss on FDI, it is very essential that one is able to make a clear demarcation between the FDI flow as well as the FDI stock. The former refers to the amount of the foreign direct investment which has been undertaken across the period (which normally is taken as one year) whereas the stock of FDI implies the total built up value of the foreign assets which are owned for a given period of time.

It has been seen that there has been a significant increase in the investment opportunities in the FDI domain during the years 1990 to 2000s. This increased growth rate is due to the political stability as well as the other economic factors present within the developing countries. Further it has also been seen that with the advent of globalization, the economy of the world has made organizations invest across the globe to have the presence felt in almost all the regions of the world. The increase in the inflows which the county of US has been seeing is another shocking but a significant trend where the inflows have increased but on the other hand its counterpart, the US –FDI –abroad has not gone that high. Once can conclude the growth if the US inflows to be high due to the lucrative US markets and also due to the falling dollar value which has been seen in the recent past.

FDI also have several benefits like rapid approvals for the investments, concessions in taxes, better liberalized environment for operating, subsidies on loans, grants, etc are few of them. The country (i.e. the host) also gains benefits due to the FDI’s in the increased job opportunities, better living standards, enhanced economic growth, etc. Hence FDI’s are always beneficial for both the host country as well as for the foreign investor.

Governments have also devised many policies for attracting the FDI’s as these funds can be used for national development projects and strategies. Governments also provide various types of tax benefits to the investors so that higher amounts of investments are made by the foreigners. The basic strategy of the government is to make the FDI investment all the more lucrative for the investors to increase investment opportunities. The common ones which are implemented by the government is to provide tax benefits as well as reduced interest rates on loans which have till date run successfully.

The developing countries have now become hot attractive spots for the FDI’s due to the better political stability and economic factors. Countries like India have accumulated a lot in the form of FDI from the other foreign countries as the economic and political stability of the country of India gives an ease to the investor to invest without much contemplation. We have seen how the FDI amount varies and increases in the Indian market when the stock market face jolts and jerks.


Business and Investment Opportunity at Large

After the post independence strong socialistic & economic reforms, the economic growth climbed steadily & after 1991 the embracement of open market principles for international completion & foreign investment, Business in India today offers great Investment Opportunities for domestic & international sectors. Strong foreign fund buying has kept the share market chart favorable in spite of recent fluctuation in world stock market. Recently Indian Rupee was raised to 21 paisa against one time ruler US dollar. Initiating a business involves certain steps. A directorate of Industries is the nodal agencies who guide new entrepreneurs. An interface between industry & various agencies are provided. Support provided regarding Investment Strategies & single point window service can be availed.

Special economic zones are created for foreign investments. In the export oriented units 100% foreign direct investment is permissible. A tax relief is provided thus making India a Mecca for Investment Opportunities. Among the non-export incentives no tax levied for the first five years. The Indian business trend was Information technology bent from early 90s. Currently there are huge investment options in infrastructure, petrochemicals, pharmaceuticals, and telecommunication & service industries. Considering the nature of business the Investment Strategies are designed accordingly. Foreigners are utilizing billion heavy Indian markets not for only their expansion but to use as operational hub also.

Some key areas like infrastructure, power, automobile, electronic hard ware etc. are receiving attention not only for foreign but domestic ventures also. The principle of inclusive growth is striking the right balance by creating huge job opportunities for semi skilled or unskilled enormous work force. The compliance to inclusive growth has definitely contributed to the GDP rate. India with a quite matured capital market backed by liberal policies& strong banking system has turned to a profitable business ambience both for domestic & international businessmen. Both Mutual Fund and Equity Fund investments suggest a favorable & significant return. Considering the service industries like hotels, restaurants, placement concerns Indian scenario is enviable. Along with development & advancement as mentioned before the infrastructure industry in India is booming, which can accommodate both types of investors. As far as strategies are concerned they vary from one to another business. Business strategies always have to take into account government policies, restrictions & relief. It is not only foreign investors the domestic counterparts are also getting various reliefs for promoting a particular type of business which may benefit people at large.

In a nutshell today India can boast of enriched business environment guaranteeing high return & offering employment to huge work force.

September 6, 2011

Booming Indian Economy Creating Investment Options for NRIs

The global meltdown of 2008 hardly had any effect on India, while the entire world was reeling under the recession effect. It was India which presented itself as a shining example to other nations, on ways to come out of crises successfully and prosper simultaneously. This attitude has helped open up investment options for the people at home and also abroad. The government has also come up with better investment options for the NRIs as well. The investment trends guides in putting our hard earned money to profitable use.

Investment options in India: the best investment option right now, is in the real estate sector. While in 2009, it was the stock market, in terms of investment to reap rich dividends. The real estate sector is extremely profitable venture, as the profits of investors have almost doubled or have derived 100% profits in the residential segment. The commercial real estate sector is another lucrative option for investment as their prices have risen over the years only substantially and there is always the likelihood of steep increase in prices in this sector. Many banks have increased their deposit rates, for senior citizens up to 9%; this is one of the safest forms of investment in India. In spite of inflation, India has emerged as the topmost destination for investment.

Investment trends: The investment trends relates to investing wisely so as to attain a better state of financial security. Therefore, investment trends are more about investing safely such as in gold, which is on the rise and is invaluable. NSC (National Savings Certificate) and PPF (Public Provident Fund) are another form of safe and secure investment. Life Insurance offers another secure investment.

Investment options for NRIs: The investment options for NRIs are plenty, be it mutual funds, bank deposits, real estate or life insurance. It is seen how majority of the NRIs wishes to invest in India and they are also responsible for the FDIs through continuous transfer of cash flow, one of the vital fact in India’s growth. They do so through the money they send to their relatives, parents and dear ones for investment. The government has also been flexible in providing business opportunities to the NRIs through tax subsidies and hassle free legalities. The government also organizes a summit exclusively for the NRIs, exhibiting a wide range of business opportunities for the NRIs. NRIs can also invest in insurance policies without any limit to the policy cover and also they have the option of paying their premium in foreign currency. The real estate sector offers a sound investment option for the NRIs as there is not the need to seek permission from the RBI to invest in it. Also investing in gold is another potential option.

So, we see how a booming Indian economy has raised the economic standards in the whole world, which makes it the most prospective capital market to do business and prosper significantly.

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