Investment Opportunities in India

May 3, 2013

Scenario of pharmaceutical market in India

The pharmaceutical industry in India is most progressive and advanced among all the developed and developing countries. The industry has provided great employment opportunities to thousands of people, apart from contributing greatly towards the Indian economy.

Today, India is among the top five pharmaceutical emerging markets in the world. The market is expected to grow at a compound annual growth rate (CAGR) of 14-17 per cent over 2012-16. The total revenues of the market stood at US$ 11 billion and are estimated to be US$ 74 billion by 2020.

Growth in the sector

  • Pharma sector in India is growing at a rapid pace, marked by a number of mergers and acquisitions (M&A) and growth in foreign expenditure. The sector is going to be a major area of focus in the coming years as Indian medicines are increasingly becoming popular in many parts of the world because of the cost effectiveness and easy availability. The manufacturing cost of Indian pharma companies is up to 65 per cent lower than that of US firms and almost half of that of the European manufacturers.
  • The domestic pharmaceutical market is expected to register a strong double-digit growth of 13-14 per cent in 2013 on back of increasing sales of generic medicines, continued growth in chronic therapies and a greater penetration in rural markets.
  • The growth of healthcare sector also provides huge opportunities for investing in India’s pharma space. The growing network of private and public hospitals in the country generates a huge demand for industrial cleaning equipment, waste management, hygiene products and laundry solutions.

Pharmaceutical exports

The Ministry of Commerce has targeted Indian pharma sector exports of US$ 25 billion by 2014 at an annual growth rate of 25 per cent.

Last year, the industry registered exports of US$ 13 billion at a growth rate of 30 per cent, as per Dr P.V. Appaji, Director-General, Pharmaceutical Exports Council of India (Pharmexcil). The Government has also planned a ‘Pharma India’ brand promotion action plan spanning over a three-year period to give an impetus to generic exports.

FDI inflows

The cumulative drugs and pharmaceuticals industry in India attracted foreign direct investment (FDI) inflows worth US$ 10,308.75 million during April 2000 to February 2013, according to the Department of Industrial Policy and Promotion (DIPP)

Recent initiatives

The Department of Pharmaceuticals has prepared a ‘Pharma Vision 2020’ document for making India one of the leading destinations for end-to-end drug discovery and innovation and for that purpose, the department provides requisite support by way of world class infrastructure, internationally competitive scientific manpower for pharma research and development (R&D), venture fund for research in the public and private domain and such other measures.

Pharmexcil has removed the need for overseas investors to get a no-objection from their joint venture (JV) partner before venturing out on their own or roping in another local firm. This will promote the competitiveness of India as an investment destination and be instrumental in attracting higher levels of FDI and technology inflows into the country.

FDI policies

  • FDI, up to 100 per cent, under the automatic route, is permitted for green field investments (when a company establishes a subsidiary in a new country and starts its own production) in pharmaceutical sector in India
  • FDI, up to 100 per cent, under the government approval route, is permitted for brown field investments (when company purchases an existing plant or firm, rather than construction of a new plant)
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March 20, 2013

Investments options for NRIs in Indian infrastructure sector

Infrastructure development in India has contributed majorly in the country’s economic transformation and growth during the last decade. Roads, ports, railways and power are key segments of the infrastructure sector. Some of the key facts related to the same are –

  • Indian Shipping segment, with 187 minor ports and 13 major ports, is spread across nine maritime states
  • The Indian Railways network is spread over some 64, 000 km, with 12, 000 passenger and 7, 000 freight trains plying each day from 7, 083 stations carrying around 23 million travellers and 2.65 million tonnes (MT) of goods daily
  • Indian road network is the second largest in the world with a total length of 4.1 million kilometres (km)

Investment Opportunities for NRIs

Overseas investors looking for high return on investments are going to target Indian infrastructure companies in the coming years, says a report by research agency Preqin. As per the study, India is attracting the highest number of unlisted, closed-end funds that focus on a single country, making it the most preferred choice among the business investors. India is expected to require around US$ 1 trillion worth of infrastructure investment over the next five years

Non-resident Indians (NRIs) investing in India can choose from sub-sectors such as power, telecom, roads and ports. The Preqin report says 74 per cent of India-focused funds will invest in greenfield projects, 84 per cent in brownfield assets, and 42 per cent will buy out the stakes of other PE funds.

Investments Policy Updates

  • FDI up to 100 per cent under the automatic route is permitted in exploration activities of oil and natural gas fields, infrastructure related to marketing of petroleum products, actual trading and marketing of petroleum products, petroleum product pipelines, natural gas/LNG pipelines, market study and formulation and Petroleum refining in the private sector. This will be subject to the existing sectoral policy and regulatory framework in the oil marketing sector and the policy of the Government on private participation in exploration of oil and the discovered fields of national oil companies
  • FDI up to 49 per cent is permitted under the Government route in petroleum refining by the Public Sector Undertakings (PSU)
  • FDI up to 100 per cent under the automatic route is allowed both in setting up new and in established industrial parks from overseas investors

Recent Investments in Indian Infrastructure Industry

  • IVRCL Ltd has entered into an MoU with the Haryana Government for the development of Rai Malikapur-Kharak road corridor which would cover a stretch of 151 km of Rai Malikapur close to the Rajasthan border up to Kharak corridor and enhance the north-south connectivity. The Rs 1, 605 crore (US$ 292.23 million) project will take about 30 months to execute
  • Indian Railways has recently launched an application namely RailRadar which envisages an interactive map to allow users to track train movements on real-time basis. Such an application has been launched for the first time in India, wherein any of the public transport system can be tracked on the internet and mobile

Future of Indian Infrastructure

India is betting high on business investors in infrastructure as the Government hopes that the private sector, through public-private partnerships (PPP), will invest US$ 350-400 billion in infrastructure sectors (like roads, ports, railways and airports) between 2012 and 2017.

November 23, 2012

Scope of Investment Environment in India

India is in the middle of fast economic and social conversion and it provides a constant, flourishing platform for businesses to grow. It also provides rich investment opportunities to non-resident Indians (NRIs). It is one of the quickest, easiest and successful cost-effective commitment locations to set up a company. In fact, India is the second-most successful location, according to UNCTAD’s World Investment Leads Study 2010-2012.

Foreign Investments in India

Indian equities have attracted maximum investments by Foreign Institutional Investors (FIIs) as compared to any other Asian market on the back of policy reforms undertaken by the Government of India to promote economic growth. Foreign investors in India remain substantially strong and have invested over US$ 13 billion into Indian stocks till September 2012. Some of the key investments and developments are:

  • Overseas investors infused about US$ 645 million from October 1, 2012 to October 5, 2012 itself, while they invested more than US$ 3.5 billion in the month of September 2012, according to data released by capital market regulator, the Securities and Exchange Board of India (SEBI)
  • FIIs also infused Rs 1,382 crore (US$ 260.47 million) in the debt market in the first week of October 2012
  • As on October 5, 2012, the number of registered FIIs in the country stood at 1,753 while, the total number of sub-accounts were 6,329
  • Another statement issued by the Reserve Bank of India (RBI) revealed that foreign exchange reserves stood at US$ 294.81 billion for the week ended September 28, 2012 wherein the value of gold reserves was recorded at US$ 28.133 billion and that of foreign currency assets (FCAs) was at US$ 259.96 billion

The Center for Monitoring Indian Economy (CMIE) projects that FII inflows would strengthen in the second half of FY13 at US$ 11.2 billion as India is looked upon as a viable long-term investment destination on the global canvas. Major FIIs like JP Morgan, Morgan Stanley and Deutsche Bank are believed to drive the positive wave of foreign investments.

Government Initiatives

The Government of India is playing a vital role in attracting and providing an investment friendly climate to foreign investors in India. The policies have been liberalised to entice more and more cost-effective commitment methods. Some of them are as follows:

  • The Government has created many policies and schemes to maximize investment opportunities for NRIs in the real estate sector of India
  • RBI has allowed, both people residing outside India holding Indian passports and also person of Indian origin (PIO) to invest in residential as well as commercial properties in India
  • RBI has granted general permission to NRIs/PIOs, for undertaking direct investments in Indian companies, under the automatic route purchase of shares
  • NRIs/PIOs are permitted to invest in the foreign direct investment (FDI) scheme on a repatriation basis in equity shares/ Compulsorily Convertible Preference Shares (CCPS)/ Compulsorily Convertible Debentures (CCDs) of an Indian company

Government’s involvement on policies, especially, tax rules and foreign direct investment (FDI) in areas like retail, aviation etc. will play an important part in driving large deals. India’s development tale continues to be unchanged and NRIs/PIOs can look ahead to see better financial commitment options in second half of 2012.

May 8, 2012

Indian Economy – A Basket of Business Opportunities

The population of India is estimated at over 1 billion, and continues to grow every year. The Indian economy is the fourth largest economy of the world, when we talk in terms of Purchasing Power Parity (PPP). The economic reforms initiated since 1991, have been providing an investor-friendly environment through a liberalized policy framework spanning the whole economy. These reforms have helped India in becoming more prominent in undertaking importing and exporting activities, and other such forms of overseas businesses.

More than 10 per cent of the employed population works in industrial fields, and these include manufacturing and production of textiles. Process outsourcing is another business in India in which economy has grown drastically over the years. Residents of India are fluent in English, they have good communication skills for doing customer service, they are conversant in tech support, and other similar service industries, so the Business Process Outsourcing (BPO) segment has good scope in India. In fact, out of the top fifteen outsourcing companies across the globe, seven of the large firms are located in India.

India also produces a good amount of agricultural products, along with development in segments such as logging, fishing, and forestry. Investment is increasing as banks have become more stable and secure, which was also part of the economic reform. India’s growth rate is approximately 7% on an average, and has greatly reduced the amount of poverty among its residents over the years. The constant growth of main industries has given more individuals the opportunity to have stable employment.

India is one of the most sought after destination for business and investment opportunities. The reasons behind this are:-

  • Extensive manpower base
  • Diversified natural resources, and
  • Strong macro-economic fundamentals

Over the last ten years, the Indian Economy has seen a paradigm shift and is on a robust growth trajectory. The Indian economy today claims of an increasing annual growth rate, deep capital markets and liberalized foreign direct investment (FDI) regime. India is one of the few economies to have withstood the recent global financial crisis and its gross domestic product (GDP) has been constantly growing in excess of 8 per cent per year. The country’s GDP has been growing at an average rate of 8.6 per cent for the last five years. India’s GDP growth projection is 8.5 per cent for FY11.

India’s economy has strong fundamentals and is host to several prominent global corporate giants that are leaders in their respective fields. According to the Global Competitiveness report 2010-11, India ranks 51st among 139 countries. India ranks higher than many countries in key parameters such as market size (4th) and innovation (39th). It also has a sound financial market (17th).

According to UNCTAD’s World Investment Prospects Survey 2010-2012, India is the second-most lucrative destination for FDI in the world. Indian markets have significant potential and offers prospects of high profitability and a favorable regulatory regime for investors.

The Better Part of Foreign Investment in India

In the last few years India has witnessed a major change in its economic environment, on the back of foreign investments into India. The huge foreign capital investments have bought India considerable financial benefit. Markets are expanding in India, trade policies are being liberalized and there had been further development in technology and telecommunication as well. After China, India is now growing in popularity with a huge amount of foreign capital coming in. Foreign investors are putting in money in fields like telecommunication, infrastructure, computer hardware and software, information technology and hospitality.

Investors from abroad have been providing huge financial help to companies, corporations, business and organizations and here lies the significance of foreign direct investments (FDI) in India. India is growing in opportunities because of huge foreign investment. There are some automatic routes for making the investment and one can even invest through several processes undertaken by the Government. One can go for several joint ventures if one wants to be an effective direct foreign investor. One can really make a favorable fortune if one invests in sectors like real estate education, biotechnology, alternative energy sectors and other specialized fields.

With the route of foreign investments into India, companies can start a new venture and at the same time opt for business expansion. Thus, this is a better way to start and grow big at the same time. There are several advantages of a direct foreign investment in India. Wages in India are cheap and this is the reason more number of people would want to start here.

There are special investment privileges being offered at the place and this is the reason the concept of FDI in India is gaining immense popularity. Moreover, the investors would get a tariff-free access to the Indian markets and this is a real advantage for them. The investors can even enjoy tax exemptions at the place and this is the reason investors would want to put in money at the place more than once.

When talking about foreign investments into India one may focus on other aspects as well. With the entry of huge capital, there are industries in India which have been breathing fresh lease of life. They were at the verge of being extinct and due to the efforts of some foreign investors they have gained life once again. In fact, the legal aspects in India are quite flexible for foreign investors to operate and this is the reason it has been possible for people to make a fortune in this part of the world. Moreover, as India is rich in human resource, so starting anything new seldom faces hindrance over here. Therefore, with right training and correct infrastructure India will continue to be a favorite to the investors involved in legitimate investments.

April 9, 2012

Judging Business Investment Opportunities is Important

There are innumerable business investment opportunities meant for you. You have to grab the right one for yourself. In business you can literally invest after anything. However, a blind investment can really make you suffer in the long run. Make sure that you know in details after what you are investing. You can invest in an existing company or you can also invest in a fresh business opportunity. It absolutely depends on your requirements. However, it is always safe to invest in something which is already there. There would be minimum risk of failure. Investing after a fresh concept is hazardous. To do this you have to go through a solid research work. A perfect find out will always help you invest in the best possible way.

Are you trying to go for something more dynamic and global? Then make plans for business investments after international entrepreneurs. For this you can take the best help from internet. There are dedicated websites for the purpose and they mainly aim at matching the business enterprises with all potential investors. On net business investment is quite risky. In most cases you are dealing with an unseen company. In no way you can trace the company if you lose cash in the process. In recent years to avoid such uncanny situations most investors are checking with the international status of a company before investing a sum in the venture.

There can be local business investment opportunities as well. To do this you can start looking for the Chamber of Commerce in your particular area. Being a member of this organization you can invest in business more confidently. The chamber of commerce is a place where business men of all, status and potential come to meet each other. Business is greatly discussed in such places and the current economy is judged at a bigger rate. Here you would also find businessmen helping each other in times of need. Chambers can lend you money to buy equipment and enhance your business status.

Researching is a very important part of business investment opportunities. There are several possibilities of investment and this is the time for you to know about them in details. Never skip your research stage. Putting in money without proper knowing is a crime. You can even borrow money from several fiscal organizations when you plan to invest in business. However, such economic bodies would be really interested to know the nature and extent of your business. This is because they would be interested in judging the possibilities of your business to find out whether you would be able to return the loan in time.

There can be good business investment opportunities and there can be those safer ones as well. However, in risky business affairs the returns are quite promising. Once you win the opportunity you would get huge in return. But, the tag of risk is always there. On the other hand in less risky business affairs the amount of gain is sure to be less. The lesser is the risk the less would be the gain. Here a self-judgment is highly required before you make the ultimate investment.

March 23, 2012

Infrastructure in India and its Varied Opportunities

The Infrastructure for India can be based on power and electricity and it is a common knowledge that these infrastructures needs serious built ups, the service sector has taken a leap into excellence and is inviting more and more clients from abroad to set up their customer service industry in the Indian market. The transport is another sector and the labor migration and security all are different sectors that need to be explored a little more so that they can bring in more prosperity for the market. The infrastructures can be improved by more planning on each side and sector and then investing on them so that they grow.

The labor cost are lower in India than its competitors and the hence there is no shortage for cheap labor. The fresh stream of air in the industries can be brought as incentives from different governmental bodies and public sectors. There are various Investment Opportunities for the Indian market as it is a source for raw materials and there is the modern work forces that bear a better communication skill that can bring in the changes. The investment can be made by investors who are looking for different ways to earn profit.

This democracy is one of the largest in the world and hence it has become a top resource for the countries worldwide and developed the growing opportunity for different Infrastructure for India for different manufacturing units. The deposit of natural resources like iron ore, coal, titanium ore, petroleum, mica, limestone, dolomite and many other such ores give India a lot of opportunities to channelize its resources. The area that is covered by forest is also vast and therefore can be tapped for other resources like the flora and the fauna and the different rare timber and vegetation.

The Indian economy has traditional farming by using modern agriculture. It has a chunk of workers who work on handicrafts that are done by using bare hands and small machines propelled by hand. The Investment Opportunities will be seen with the large industries like the large machine driven manufacturing units and service units. The food producing units cater to the food for the people all over the world. The industry based on production of sugarcane, rice and tea have also grown to a great extent and there are also the products from milk, fruits and vegetables ruling the market and these can compete well in the global market.

This is a land of diverse economy and varied resources. The Infrastructure for India does comprise of areas that have not been tapped properly as yet and other side shows us sectors that has grown and has brought in economic restructuring for the country. The industry that introduced Foreign Direct Investment are the service sectors, fuels and chemicals, the area for electrical equipment and the construction industry and the telecommunication industry. The drug and food processing are other areas that have grown and the recent growth has been seen in the outsourcing industry. India still has areas that has huge potential and not yet been tapped and they can help the Indian states and the country gain prosperity as a whole.

March 14, 2012

Investing in India is a Good Way Out

India is a land with far reaching hopes in the field of foreign investment. You give one and you get plenty in return. The soil of India is yielding. For any external speculation you have lots to gain from this eastern zone of the world. Investing in India is a good work and you would surely have the golden days in future for this. For proper inflows in India there have been several releases in the genre of simplified compendium based on FDI or Foreign Direct Investment. These, several FDI processes along with other associated investing terms opportunities are growing to make this ground the best field for utilization and investment.

Things are so promising in this part of the world that any source of foreign investment in India can locate the nodal bodies and best invest for more profitable gains in life. It is also important for you to know that the Reserve Bank of India has been unleashing some of the sections in the sector of FEMA or Foreign Exchange Management Act allowing people living outside the periphery make lucrative investments in India. These are open routes for the investors so that they can put in that extra to have a more than expected gain in business.

Recently, in matters of investing in India, the government is trying to take away all the liberties which the NRIs have been enjoying till now in sections like real estate, aviation and the others. There is so much for the investors to put in in the multi-faceted retail production, agriculture, retailing and other wings in international business. At the time of ongoing discussions the government makes all attempts to frame out concrete policies in the genre. This is just like an encouragement enticing all potential investors to rush with their several investment proposals for a perfect interpersonal business relationship down the years.

FDI has promised to introduce revolutionary alterations to make things more promising for all potential Indian consumers. Recently, there has been a partial unleashing of the retail sector with a 51 percent of foreign direct investment in matters of single brand retailing. Thus, big names like Versace, Marks & Spencer, Nike, Adidas and others are fast coming up with their stores in several parts of India.

When investing in India the foreign names no more have to concentrate in trying to set up things. They are surely planning to make things happen in the bigger way. They are trying best to strengthen their holds in the field of communication and network retailing. They even have much to give in form of discounts and offer keeping pace with the Indian mode of linking things. Thus, when you are getting bigger brands in the same number of coins, you would have more reasons to make untimely purchases.

How to Gain Best From Infrastructure in India

A good set of infrastructures is a must requirement in making a country stand best. These are essential prerequisites to help a country flourish systematically. The Indian government has realized this perfectly and they are trying best to put things in order. Proper roads, steady telecommunication, perfect water supply, effective power grids and the like are constantly being established and renovated to make things smooth for investors both within and outside the nation. India is a good sector for international investment – this fact can only be proved with a definite economic infrastructure planning.

To attract better investment opportunities in India it is unlikely to have real means of growth. When foreign investing companies will have difficulty in spreading out they would be bound to think twice before making an investment. Thus, you have to think about the improvement of all major sectors like irrigation, electricity, gas pipeline and telecommunications to help reach the effects of developing nation reach to the interiors of the land. However, there should not be any sort of disparity between what has been actually planned in economics and the genre of actual financing.

To merge the gaps well and come up with an effective infrastructure in India it is essential for you to keep these points in mind. Firstly, much strength should be applied in the corporate bond market. When the bonds are strong you would be able to invest without doubts and difficulties. You must also make sure to allow insurance companies to come to the scene. This would help you arrange for that extra fund in business and for setting up better infrastructures. It would also be wise to welcome foreign investors for making a capital investment for the fast development of the infrastructures.

A good network of transportation in India has made good scopes for investment opportunities in India. This includes all, coastal shipping, road, rail, air transportation and other effective means of communication. The domestic sections of Indian market are greatly benefitted for having well-constructed roads in all parts of the country including both rural and urban areas. In fact, the connection between economic growth and effective infrastructure is always there. If you cannot connect or reach well how you would make the perfect use of your inventories – this is an important question to be asked.

It is required to have the best infrastructure in India to take economic growth to heights. The progress is slow but gradually things are really getting to their right places. Now, the world is beaming with new technicalities and for India to absorb the bests from these techno sources it is essential for the proper layout of the infrastructures. According to the reports as stated by UNCTAD, India is identified as one of the most attractive location where you can invest with the mind to get the best out of the place. Lots of infrastructure improvements have already been made and some more are still waiting in queue to make a mark globally.

November 9, 2011

Investment in the power, education and finance sector in India: An Overview

A global recovery was witnessed during the 2nd part of the FY 2009-10 and on the back of it 2010-11 kicks off much but the equity market no more delayed to take the cue at a much earlier stage. Since June 2009 to March 2010 a trend remain bound to the range could be seen in the market and it ranged from 4500 – 5300 on the Nifty Index. This particular trend in the movement has been pointed out as a consolidation based on a broad scale after the market recovered at a high pace from the trough levels encountered during the recession period.

The promising part is that the market condition again came back to the 5300 level at Nifty and a breakout is varying much on the go. Hence this is the time to be prudent enough to explore the various sectors and the industries in order to find out opportunities to put the hard earned money in the highly profitable sectors. Here are few choices for you to decide on which had been the high flying sectors during 2010-11 and were considered as the winners. Hope this will help you to gather little insight to help in your investment.

The growth story of India is certainly indebted to the increasing rate of power generation in the country. It can be well said that energy is one of the components that has largely contributed to the development of the country.

One of the important objectives targeted by the government of India is electricity for all and the deadline is 2012, which will be by the end of the 11th Five year plan. With an exponential increment in the demand of electricity is leading to greater opportunities for the investors to plough the mullah in both private and public sector. The power sector in India is thus gaining more significance with each passing day. The thermal power plants based on generation of coal is at present accounting for about 2/3rd of the energy requirement of the country and the increasing awareness of the government about generating power by means of cleaner nuclear power plants is also on the rise.

On the other hand investment in the Indian education sector is another lucrative option and is going to reap huge profit if the money will be ploughed in a planned manner. One must explore the roots of the Indian education sector and find out as many options as possible and then zero on a decision. The financial services sector is another nice option. As it is often been said that the banking industry reflects the financial health of the country and even enables the trading activities to greater scale. The banking sector in India emerged in flying colors during the recent crisis struck the global economy and that too on the back of the stipulations laid y the Central bank. Therefore the financial services sector in India has indeed facilitated the quick, hassle free transactions and other developments by means of offering unmatched services.

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