Investment Opportunities in India

June 3, 2013

Growth of tourism in India

Tourism refers to the activity of visitors. A visitor is a traveler taking a trip to a main destination outside his/her usual environment for less than a year, for any main purpose (business, leisure or other personal purpose) other than to be employed by a resident entity in the country or place visited, according to UN World Tourism Organisation (UNWTO).

Tourism is an important social and economic phenomenon in many countries. It is a key driver of socio-economic progress through the creation of jobs and enterprises, infrastructure development and the export revenues earned.

Indian tourism industry

Compared to many countries, Indian service industry has the advantages of possessing a rich and diverse range of unique tangible and intangible cultural, natural and man-made tourism resources, many of which are world class in quality. India’s great competitive strength from tourism point of view is its ancient and yet living civilization that gave rise to four of the world’s great religions and philosophies, and brought travelers and trade millennia ago. The rich natural and rural landscape of India is punctuated with the built heritage of its ancient past and modern structures. India’s contacts with other civilisations is reflected in the rich cultural diversity of its people through its languages, cuisine, traditions, customs, music, dance, religions practices and festivals, its holistic healing traditions, art and craft.

Overview of Indian tourism sector

Today, tourism is the most vibrant among the Indian service industry and has a strong hold on the economy. The sector contributes 6.23 per cent to the national gross domestic product (GDP) and 8.78 per cent of the total employment in India. Moreover, India stands 42nd in the world rankings in terms of foreign tourist arrivals (FTAs) in the country, according to a report titled ‘Competitiveness of Tourism Sector in India with Selected Other Countries of the World’ by Ministry of Tourism. The World Travel and Tourism Council (WTTC) named India as one of the fastest growing tourism industries for the next 10 to 15 years.

FTAs have shown a growth of 2.8 per cent in March 2013 over March 2012 while the growth rate in Foreign Exchange Earnings (FEEs) from tourism in India stood at 21 per cent over the same period.

The Visa on Arrival (VoA) Scheme of the Government of India has registered a growth of 63 per cent during March 2013. A total number of 2,107 VoAs were issued last month as compared to 1,287 VoAs issued in March 2012.

Investment options in Indian tourism industry

Strong growth in per capita income in the country is driving tourism in India. A shift in demographics with rising young population (coupled with changing lifestyles) is leading to greater expenditure on leisure services. The tourism policy of Government of India aims at speedy implementation of tourism projects, development of integrated tourism circuits, special capacity building in the hospitality sector and new marketing strategies.

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May 16, 2013

Business Incubation in India

Indian market today is reshaping the world’s economy. India’s gross domestic product (GDP) has crossed the trillion dollar mark in 2007 and is currently in 4th position (PPP) after US, China and Japan. Investment in almost every sector (Education, Food, Energy, Health Care and Retail) of the Indian economy has a promise of high returns that has caught the attention of investors and businesses across the world.

India offers a stable, prosperous foundation to grow one’s business. It offers rich business opportunities and markets to non-resident Indians (NRIs) for new products and services. It is one of the fastest, easiest and lucrative investment destinations in the world to set up business. India is the second-most profitable destination, according to UNCTAD’s World Investment Prospects Survey 2010-2012.

Business Incubation in India

Business incubation is a dynamic process of business development. Business incubators are programs designed to accelerate the successful development of entrepreneurial companies through an array of business support resources and services, developed and orchestrated by incubator management and offered both in the incubator and through its network of contacts. Successful completion of a business incubation program increases the likelihood that a start-up company will stay in business for the long term.

Incubators usually also offer companies rental space with flexible leases, shared basic office services and access to equipment all under one roof.

Overseas Indians who wish to enter a business incubation program must apply for admission. Acceptance criteria vary from program to program, but in general only those with feasible business ideas and a workable business plan are admitted.

Startup Incubation Centers in India

Startup Incubation holds significant importance in a country like India where entrepreneurs by the score are launching new setups and changing the game of business by minutes. For the uninitiated, business incubation programs or centers provide support functions, mentorship and resources to individual entrepreneurs or entrepreneurial setups. This enables them to get all the expert advice and technical guidance that they need to survive for a longer time, unlike most other entrepreneurial ventures that fizzle out within a few months of their launch.

Almost every other prestigious B-school today houses an incubation center so that business opportunities can be nurtured from their very source. Currently there are about 100 incubation centers supported by the Indian STEP and Business Incubator Association (ISBA) which is the apex Indian professional body supporting business incubators. Private incubators are a handful, but gradually growing. These numbers are expected to double within the next two years. Some of the good business incubation centers in India:

  • Centre for Innovation, Incubation and Entrepreneurship (CIIE), IIM Ahmedabad
  • AngelPrime
  • Indian Angel Network (IAN)
  • Technopark Technology Business Incubator (T-TBI)

Long term projects are projects of national importance that will help in India’s development. These platform showcase investment opportunities in projects that require funding and will also help you to contact relevant institutions undertaking the projects. This information will be updated regularly to generate fresh investment opportunities for the overseas Indians.

Attractive investment opportunities for NRIs in India

“India is clearly becoming a more and more important player on the world stage in G20 context, in terms of its role in the global economy. It is very useful for us to exchange ideas and build the basis for future collaboration,” according to Mr Ben Bernanke, Chairman, US Federal Reserve.

India is the fifth best country in the world for dynamic growing businesses, according to the Grant Thornton Global Dynamism Index. The index gives a reflection of how suitable an environment it offers for dynamic businesses.

In addition, India’s economic confidence registered an increase of 8 points, to reach 68 per cent in August 2012 as compared to the previous month, according to the ‘Ipsos Economic Pulse of the World’ survey. This makes India the fourth most economically confident country in the world.

India is also expected to be the second largest manufacturing country in the next five years, followed by Brazil as the third ranked country, as per Deloitte Touche Tohmatsu Ltd (Deloitte).

The Government of India has relaxed foreign direct investment (FDI) regime in sectors including multi-brand retail, single-brand retail, commodity exchanges, power exchanges, broadcasting, non-banking financial institutions (NBFCs) and asset reconstruction companies (ARCs) in 2012 to attract more and more direct investments.

Business Opportunities in India

Mr Mahmood Al Hashemi, Director General of Ajman Free Zone Authority (AFZA), UAE will tour India and address a series of seminars and press conferences in Mumbai, Delhi and Ahmedabad this month. This high profile visit to the Indian sub-continent will be to initiate and build a long and lucrative means of economic cooperation between the two countries.

This will provide huge opportunity to young entrepreneurs doing business in India.

Here’s a list of 5 good opportunities non-resident Indians (NRIs) can look at:

  • Software: India’s software and services exports are likely to rise with export revenue growth projected at 13 to 15 per cent. With one of the largest pool of software engineers, NRIs can set higher targets in hardware and software development
  • Tourism: Tourism is a booming industry in India. With the number of domestic and international tourists rising every year, this is one hot sector NRIs must focus on. India with its diverse culture and rich heritage has a lot to offer to foreign tourists. Beaches, hill stations, heritage sites, wildlife and rural life, India has everything tourists are looking for
  • Automobile: India is now a hot spot for automobiles and auto-components. A cost-effective hub for auto components sourcing for global auto makers, the automotive sector is potential business in India for foreign investors
  • Textiles: India is famous for its textiles. Each state has its unique style in terms of apparels. India can grow as a preferred location for manufacturing textiles taking into account the huge demand for garments. Places like Tirupur and Ludhiana are now export hubs for textiles. A better understanding of the markets and customers’ needs can boost growth in this sector and attract direct investments
  • Education and Training: There is a good demand for education and online tutorial services. With good facilities at competitive rates, India can attract more students from abroad. Unique teaching methods, educational portals and tools can be used effectively to make the sector useful and interesting

March 28, 2013

January 28, 2013

January 4, 2013

Policies for foreign investors to do business in India

“India is clearly becoming a more and more important player on the world stage in G20 context, in terms of its role in the global economy. It is very useful for us to exchange ideas and build the basis for future collaboration,” according to Mr Ben Bernanke, Chairman, US Federal Reserve.

India is the fifth best country in the world with dynamic growing businesses opportunities for non-resident Indians (NRIs). The Grant Thornton Global Dynamism Index gives a reflection of how suitable an environment it offers for dynamic businesses.

Scenario of Indian Economy

The Indian economy continues to grow at a good pace and holds a strong position on the global map. The country’s gross domestic product (GDP) has been growing at an average rate of 8.5 per cent for the last five years.

India’s economy is amongst the largest in the world on the basis of Purchasing Power Parity. It is today one of the most attractive destinations for business and investment opportunities for NRIs and foreign investors with the available large manpower base, diversified natural resources and strong macroeconomic fundamentals. In FY 2011-12, the country attracted foreign direct investment (FDI) of around US$ 46.8 billion in various sectors.

The economy of India also boasts a robust financial system and deep capital markets. India’s demographic are very attractive with approximately 65 per cent of the total population falling in the age group of 15 to 64 years.

Foreign investment framework of India

The foreign direct investment (FDI) regime has been progressively liberalised during the course of the 1990s and continues to do so in the 2000s, with most restrictions on foreign investment being removed and procedures simplified. Foreign investors can invest directly and do business in India, either on their own or as a joint venture.

Some of the features of the consolidated FDI Policy of India and incentives offered by it:

  • Indian companies are permitted to issue equity shares, fully, compulsorily and mandatorily convertible debentures (FCD’s) and compulsorily and mandatorily convertible preference shares (CCPS) to the non-residents subject to pricing guidelines/valuation norms prescribed under FEMA
  • Foreign investment is calculated on the basis of ownership and control of the Indian company.
  • Use of foreign brand names/trademarks is permitted for the sale of goods in India
  • “Single window” clearance facilities and “investor escort services” are available in various states to simplify the approval process for new ventures

Sole proprietorship in India

Sole proprietorship is the oldest and most common form of business. It is a one-man organisation where a single individual owns, manages and controls the whole business. An NRI or a person of Indian origin (PIO) residing outside India is allowed to do business in India through a sole proprietorship concern. The investment should be made on non–repatriation basis subject to satisfying certain other conditions.

Tax Incentives in India

The Government of India, for the purpose of accelerated growth of the Indian economy, has extended incentives in the form of tax holiday, deductions, rebates etc under the direct/indirect taxes. Primarily, such incentive relates to export promotion, new industrial undertaking, infrastructure facilities, software industry, research, promotion of backward areas etc.

November 23, 2012

Doing Business in India – A profitable opportunity for NRIs

The Indian economy continues to grow at a good pace and holds a strong position on the global map. The country’s gross domestic product (GDP) has been growing at an average rate of 8.5 per cent for the last five years.

India’s economy is amongst the largest in the world on the basis of Purchasing Power Parity. It is today one of the most attractive destinations for business and investment opportunities with the available large manpower base, diversified natural resources and strong macroeconomic fundamentals. In FY 2011-12, the country attracted foreign direct investment (FDI) of around US$ 46.8 billion in various sectors.

Advantage India

  • World’s largest democracy with 1.2 billion people
  • Stable political environment and responsive administrative set up
  • Well established judiciary to enforce rule of law
  • Land of abundant natural resources and diverse climatic conditions
  • India’s growth will start to outpace China’s within three to five years and hence, India will become the fastest large economy with 9-10 per cent growth over the next 20-25 years, according to a report by Morgan Stanley
  • Investor friendly policies and incentive-based schemes
  • India’s economy will grow five-fold in the next 20 years, as per a study by McKinsey
  • Cost competitiveness; low labour costs
  • Total labour force of nearly 530 million

Investment Options for NRIs in India

India offers a stable, prosperous foundation to grow one’s business. It offers rich business opportunities and markets to non-resident Indians (NRIs) for new products and services. It is one of the fastest, easiest and lucrative investment destinations in the world to set up business. India is the second-most profitable destination, according to UNCTAD’s World Investment Prospects Survey 2010-2012.

India is in the midst of rapid economic and social transition and is giving a feel good factor to the NRIs, especially the real estate sector. Returns from real estate investments have consistently performed well and have even outperformed other businesses in India.

The health care sector has also opened new business opportunities in India for NRIs to invest in the country because of the rise in disposable income, penetration of health insurance and change in lifestyle of present generation.

There are many other exciting business opportunities in India, especially, for entrepreneurs dealing in outsourcing technology, internet ventures, software development, e-commerce, etc.

Government’s intervention on policy issues, especially, tax regulations and FDI in sectors like retail, aviation etc. will play an important role in driving large transactions, especially, inbound deals. India’s growth story remains intact and NRIs can look forward to see better investment options in the second half of 2012.

Success Stories

India has witnessed a number of success stories – both Indian and multinational firms have registered higher profits, increased turnover and higher sales over the years. This has prompted them to reinvest profits and inject fresh capital into their processes in order to reap the benefits of the India growth story.

Investments have been made by Corporate across the board and almost all the sectors have seen inflow of funds. Global players such as Daimler Chrysler, General Motors, Ford, LG Electronics, Samsung, Sony, Amway, Tupperware, Pepsico, McDonald’s, IBM, Oracle, Microsoft, Aviva, Nortel, and Nokia among others have benefited from their business in India and have made expansion plans for the country. The companies plan to expand by way of product diversification, setting up manufacturing base in India, increasing the existing production capacity, establishing research centres in India, etc.

October 4, 2012

Business Opportunities for NRIs in Indian Market

India is the largest democracy in the world. The country ranks second in the world in terms of total population. The liberalization and globalization of the Indian economy has led to more foreign direct investment (FDI) inflows in Indian markets. As a result, the scope for business in India has increased.

There are plenty of business opportunities in India for Foreign Investors, Non-Resident Indians (NRIs), Persons of Indian Origin (PIO) and Overseas Corporate Bodies (OCBs). The country offers liberal policy regime, along with easy availability of loans, funds and various other initiatives, which makes India a lucrative investment destination for NRIs and PIOs.

Some of the promising sectors where NRIs may invest include power, pharmaceuticals, mining, hotel & tourism, coal & ignites and other infrastructural projects. NRIs can also invest directly in Indian real estate except buying agricultural lands or plantations. They can look at huge number of central and state sponsored projects in key infrastructural sectors like education, healthcare and construction for higher returns.

Business Opportunities in India

Some of the major factors that help businesses in India to flourish include:

  • High number of people with disposable income, emerging middle class, low cost competitive workforce, and investment friendly policies
  • Availability of rich natural resources
  • Availability of a considerable section of population proficient in English
  • A well-established banking system consisting of public and private banks and other financial institutions
  • Competitive advantage in Information Technology, which can be used to enhance productivity in Industries
  • Improved infrastructure for business ventures

Steps for NRIs /PIOs to start business in India

  • Applying and getting PIO card (Person of Indian origin) – to make investments in properties, etc
  • Getting permanent account number (PAN card) from the Indian tax department, making it smoother to undertake all business and investment transactions above Rs. 50,000
  • Selecting a right and highly profitable business in India among various available options
  • Selecting an experienced person/ business professional to plan business and investments
  • Selecting a business partner in India and start a business

Investors can also take the help of business incubators and facilitators to become established and sustainable during their start-up phase. Business incubators are programs designed to nurture the development of entrepreneurial companies. They provide the companies with business support services, business advice, assistance with business planning, market and international networks, and also help in obtaining finance. Incubators usually offer companies rental space with flexible leases, basic office services and access to equipments all under one-roof. Successful completion of a business incubation program increases the chances of a start-up company to stay in business in India for long term.

Government Initiatives

To attract foreign investment into India, the Government is offering several facilities to NRIs, PIOs and OCBs. The economic reforms have brought policy changes in terms of ease of entry, investment, location, usage of technology, import and export. These changes have created an investment-friendly environment, which results in more business opportunities in India.

NRIs are permitted to open bank accounts in India with funds remitted from abroad, foreign exchange brought in from abroad or with funds legitimately due to them in India, with authorized dealer.

Further, the Reserve Bank of India (RBI) has granted general permission to NRIs/PIOs, for undertaking direct investments in Indian companies under the automatic route.

August 6, 2012

Investment Prospects for NRI’s in India

India is considered to be the second favourite destination for investors from other countries. India’s unique and vast geography, endowed with diverse topography, has made it one of the most attractive investment destinations in the world.

The healthy growth of the Indian economy also becomes evident from the inflow of the foreign direct investment (FDI). Investment opportunities in India are plentiful. It becomes evident with the numerous MNC’s not only trailing their products and services into the Indian markets but also coming forward to set up their manufacturing units in India.

The vast investment opportunities available and the positive investment climate in India have become a part of every business entrepreneur’s life. The Ministry of Overseas Indian Affairs has set up an Overseas Indian Facilitation Centre (OIFC) as a not-for-profit-trust, in partnership with Confederation of Indian Industry (CII) to promote investment opportunities amongst the overseas Indians.

Some of the fruitful investment options in India are:

Fixed deposits: It is the most common among the investment opportunities in India. These are safe investments and provide decent return.

Insurance sector: There are a lot of insurance companies emerging these days as the health is becoming less secured because of the unhealthy life style of present generation. Some of the common insurance policies are life insurance, health insurance, home insurance and the car insurance policies.

Investment in Stock: The investment in stock market in India is one of the fastest means of earning. As the stock prices are always fluctuating, the chances of risk are also high along with high profits.

Mutual Funds: It is a collective investment scheme that pools money from many investors or foreign investors in India to purchase securities such as stocks, bonds, money market instruments and similar assets. It is an easy and safe investment with periodic withdrawals.

Real Estate: The population in India is increasing and therefore land is always in demand. Besides the need to reside, the establishment of industries also requires land. The projection of real estate includes sectors such as hospitality, manufacturing, housing, retail, commercial etc. Thus it is obvious that the cost of real estate is not going to fall down. Thus the investment opportunities in India are high and by investing in a land and selling it on demand by others is an easy source to earn money.

Also, there are many other exciting business investment opportunities in India, especially, for industrialists dealing in outsourcing technology, internet ventures, software development, e-commerce, etc.

The Government of India is trying to accommodate and utilise the conducive investment climate of the country by relaxing and even introducing new policies. The change in government policy, availability of cheap resources, strong operational units, etc. are the important reasons for FDI in India. It is important for foreign investors in India to have some trend analysis of investment scope before they plan to start or set up a business in India, thus the role of investment advisors to prepare extensive investment guides to help and direct the trade investments and the scope of foraying into a particular business in India becomes crucial.

June 19, 2012

Increasing Investment Opportunities in India

India has become one of the fastest growing economies. Investment growth is eventually linked to the growth of the economy. So most of the investors look for emerging markets like India, where the growth rate is higher than the developed economies. Investing in India is becoming a big attraction for the foreign investors especially due to the booming Indian economy.

Every individual wants to invest his/her money in the right means. There are various wonderful investment options in India. The challenge is to find out the right option that can not only offer flexibility, but also provide good returns in the future.

Top investment options in India

Bank Fixed deposits (FD)
This is considered to be a safe investment and generates stable income. The minimum tenure of FD is 15 days and maximum 5 years and above. Senior citizens get special interest rates on fixed deposits. The period of ideal investment is 6-12 months.

National Saving Certificate (NSC)
It is one of the safe investment options in India backed by government. The lock-in period is 6 years. Minimum amount required is Rs100 and there is no upper limit. Since the NSC comes under section 80 C, it also entitles the individual to get tax deductions up to Rs 1Lac

Public Provident Fund (PPF)
PPF is also monitored and backed up by the government of India. A minimum investment of Rs 500 and maximum Rs 1, 00,000 is required to be deposited in a fiscal year. This includes fixed-income investment for high tax payers with low risk. Any individual in India can invest in this scheme and can earn a handsome tax free return. The lock-in period is 15 years and the interest rate is 8.8 per cent calculated annually.

Stock market
Investing in share market is another investment option to get more returns. But share market investment is volatile to market conditions. Investing in the stock markets potentially yield higher profits.

Mutual Funds
Mutual Fund companies collect money from investors and invest in share market. Investing in mutual funds is also subject to market risks but return is good.

Other investments
There are various other options for business investors in India like real estate, gold and private equity available in the country. One needs to be sure of the authenticity of the organisation, interest rates, benefits and conditions before investing.

Foreign Investment in India

Foreign direct investment (FDI) in India is possible through automatic route (which does not require any approval) and government route (which requires approval).There are set of guidelines provided by the Reserve Bank of India (RBI) and Securities and Exchange Board of India (sebi) for NRI investment in India.

The government of India has created a favorable climate for foreign investors like tax exemptions, benefits from the state and central government bodies, etc. A foreign company could invest in India either by having a wholly owned subsidiary i.e. by having a joint venture with an Indian company or by having a branch office.

There are various investment options and opportunities available in India. However, it is important to invest in that instrument which suits the individual in terms of investment amount and risk.

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