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Effective go-to-market strategies for entering the Indian market is essential for international businesses. By utilizing knowledge and comprehending the distinct cultural and business environment, companies can optimize their market reach & successfully attract customers.
India holds the position of being the world’s second most populated country boasting a population of over 1.40 billion individuals. The nation showcases a tapestry of demographics encompassing various age groups, ethnicities and languages. It is noteworthy that a significant proportion of its populace consists of people with the median age standing at 28 years. This youthful demographic translates into a consumer market, for an array of goods and services.
The Indian market presents prospects for business expansion given its substantial size and the presence of a burgeoning middle class. It's worth mentioning that the proportion of the population belonging to the middle class, which plays a crucial role in driving economic growth is projected to increase from 32% in 2020-21 to 63% in 2046-47. Numerous sectors in India have witnessed growth rates in recent years signaling a promising outlook, for companies venturing into this market. The purchasing power of consumers in the Indian market has seen a significant rise enabling them to purchase a wider range of goods and services. Bengaluru emerged as the leading city in India for purchasing power among other cities scoring 129 on the index as of July 2023. Moreover, India’s purchasing power parity has increased from 10 LCU per international dollar in 2003 to 23 LCU per international dollar in 2022. This increase can be attributed to factors such as economic growth, higher incomes and improved access to credit. In terms of GDP per capita India recorded $2380 in 2022 indicating a growth of 6.70% compared to the previous year. The middle class is expected to witness growth from approximately 432 million individuals in 2020 21 to around 715 million (47 percent) by 2030 31 with an estimated population of India reaching around 1.66 billion by the year 2047. The expansion of the middle/high income bracket has resulted in increased disposable income for consumers allowing them to spend more on products and services. Additionally, the availability of credit options has facilitated individuals making purchases which contributed towards a surge, in consumer spending. It is worth noting that the number of credit cardholders rose from approximately29 million in March 2017 to about62 million by March 2021.
1. Purchasing Habits
According to a survey conducted in September 2020 around 45% of the participants mentioned that consumers highly value getting value for the price when selecting a brand. It is common for them to compare prices and search for discounts and special offers, before making any purchase. The convenience factor and the wide variety of choices have made online shopping increasingly popular, particularly among the younger generation.
2. Preferences
Indian consumers have a wide range of preferences that are influenced by factors like culture, region and income level. The majority of consumers value quality, authenticity, and personalized service. Local products are preferred to international products. The retail industry in India is dominated by, around 12-13 million traditional stores, which make up about 85% of the market. Furthermore, sustainability and social responsibility are gaining importance in consumers purchasing choices.
3. Demographics
India is home to a diverse range of people with different backgrounds and characteristics. The middle class is growing, leading to increased purchasing power. Younger individuals, millennials and Gen Z have a strong influence on consumer trends. In cities people generally have higher disposable incomes and more options, for things to buy and services to use, while in rural areas consumer behavior is shaped by local customs and the availability of resources.
The Indian market consists of wide sectors each with its own potential for growth. Some notable sectors in India include technology and IT services, e-commerce, healthcare, renewable energy, manufacturing and agriculture. These sectors provide opportunities for businesses to capitalize on the increasing demand and contribute to the progress of the country.
Industry 1: Information Technology
The Information Technology (IT) industry in India has experienced significant growth over the past decade accounting for 7. 5% of the country’s GDP and i projected to contribute 10% to India’s GDP by 2025. With a pool of skilled professionals, favorable government policies and a strong technology infrastructure the industry has become a global leader in software development IT services and business process outsourcing (BPO). The sector is expected to continue on a path due to factors, like digital transformation increased adoption of cloud computing and the emergence of artificial intelligence (AI) and machine learning (ML) technologies.
Industry 2: E-commerce
The e-commerce sector in India has witnessed rapid growth over the past few years. India stands as the 7th largest e-commerce market with a projected revenue of around $88000 million by 2023. In 2017, ecommerce accounted for 0.76 percent of the Indian GDP. Over 100% pin codes in India have embraced online shopping. The Indian e-commerce market is estimated to reach a value of $ 300 billion by 2028 positioning it as one of the e commerce markets on a global scale. Prominent players, in the e-commerce industry include Amazon, Flipkart and Paytm Mall.
Industry 3: Renewable Energy
India possesses potential for growth in the field of renewable energy. Globally, India ranks third in renewable power capacity additions and contributes 5% of its GDP to renewable energy. The nation has established a goal of attaining a renewable energy capacity of 450 GW by 2030 comprising 280 GW from solar power 140 GW from wind power and 30 GW from bioenergy. This ambitious objective opens up prospects for investment and advancement, within the sector. The Indian government has put in place a range of incentives and policies to encourage the use of renewable energy. These include incentives like tax advantages, subsidies and grants as well as regulatory steps to make it easier for projects to be developed and integrated into the power grid. Moreover, the government has introduced initiatives such as the Solar Energy Corporation of India (SECI) and the National Solar Mission, with the aim of promoting the expansion of solar power throughout the nation India is currently witnessing the development of significant renewable energy initiatives. One remarkable project worth mentioning is the Rewa Ultra Mega Solar Park, situated in Madhya Pradesh. This solar park holds the distinction of being one of the largest in the world boasting a capacity of 750 MW. Spanning an area of 1590 hectares in the Rewa district it has attracted substantial investments, from both domestic and international stakeholders. Additionally, Gujarat’s Kutch Solar Park stands as another endeavor with a capacity of 30 GW it aspires to secure its position as the world’s largest solar park.
Industry 4: Healthcare
The healthcare industry in India has experienced fastest growth due to several factors, including a large population, increased expenditure on healthcare and a growing awareness of personal health and wellbeing. Health expenditures in India accounted for 2.1% of GDP in 2021-22. Over the two decades FDI inflows in India have grown from $ 2.6 billion in the 2000 to $ 52 billion in the year 2019-20. Investors have shown interest in the healthcare sector during recent years resulting in a remarkable increase in transaction values from $ 95 million in 2011 to $ 1270 million in 2016. Furthermore, government initiatives such as Pradhan Mantri Swasthya Suraksha Yojana (PMSSY), Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB PM JAY) and improved access to facilities in rural areas have played crucial roles in driving India’s healthcare sector forward. As of year 2019-20 there are more than 155400 Rural Sub Centres across the country including 18610 Ayushman Bharat Health & Wellness Centres. In addition, advancements in technology and telemedicine have contributed significantly to the development of India's healthcare sector.
1. Online Platforms
Online platforms have gained significant popularity in India, offering a convenient way for businesses to reach a wide customer base. Over the three years India has witnessed a surge in online shoppers reaching a staggering 127 million. Furthermore, it is projected that an additional 85 million individuals will join this trend by 2025. By collaborating with established e commerce platforms, like Amazon, Flipkart and Myntra companies can take advantage of their existing infrastructure and the trust they have built with customers to boost their sales figures.
2. Retail Partnerships
Collaborating with established retail partners in India can be advantageous for businesses looking to expand their market presence and tap into existing customer networks. By joining forces with retailers such as Reliance Retail, Big Bazaar and Croma companies can leverage their deep understanding of the market established distribution channels and strong customer relationships. These partnerships also open up opportunities for in store promotions, attractive product displays and engaging activities that enhance the shopping experience for consumers. Notably in 2019 Flipkart led the way with a 29 thousand partnerships with mom and pop stores – the largest number of such collaborations, in India.
3. Direct Sales
Direct selling offers businesses complete control over the distribution process and customer interactions. Through the establishment of direct sales channels, companies can foster strong relationships with their customers provide personalized recommendations and offer post sales assistance. In India, the direct selling industry achieved a sales figure surpassing $ 190000 million experiencing a year, on year growth rate of 5.5% in the 2021-22 fiscal year.
India boasts a vibrant economy, a skilled workforce and a strategic geographical location that grants it access to global trade routes making it an attractive business destination. The relaxation of entry barriers in India has facilitated entities access to the Indian market resulting in increased foreign investments and job opportunities. This has resulted in a more stable economy and a positive GDP growth rate. With the world returning to normalcy post Covid-19 restrictions India is now well positioned to leverage the economic prospects that come along with it. In 2022 according to the World Bank Report India was ranked 63rd in terms of ease of doing business compared to its rank of 142nd, in 2014. For foreign entities planning to enter the Indian market choosing an appropriate market entry strategy is crucial. Each entity must determine a strategy that aligns with its business objectives. Here are some options available;
Franchising is a type of business model where an established company (the franchisor) gives another company (the franchisee) the right to use its brand, products and business system. In return the franchisee pays a fee and ongoing royalties. The franchise industry in India has been steadily growing, with both established brands expanding their presence and new franchise concepts emerging. Currently the Indian franchise business is valued at around $ 47-48 billion and is growing at a rate of 30-36% per year. This industry employs, over 1.6 million people, contributes nearly 5% to India’s GDP.
This type of entity enables a parent company to enter the Indian market and conduct business without having to establish a branch office. This arrangement allows the foreign parent company to leverage the legal system and economy while maintaining control over its subsidiary. It falls under the category of direct investment and is commonly referred to as Green field Investment. The establishment of a wholly owned subsidiary is regulated by the Companies Act, 2013 and its associated rules. In recent times, India has simplified the process of incorporating a business by reducing fees and streamlining procedures. Moreover, with digitization all necessary documents can be easily accessed online making the incorporation process more efficient. The Foreign Exchange Management Act (FEMA) in India permits up to 100% investment in sectors like manufacturing, e commerce and IT through approval. In cases complete control, over business operations rests with the foreign entity.
Joint ventures provide foreign entities with an opportunity to understand the Indian market establish local connections and access resources and capabilities that may not be easily attainable, through fully owned subsidiaries. In a JV a foreign company collaborates with an Indian partner who is already engaged in business within the same field or area.
A Limited Liability Partnership (LLP) is a business entity that combines the features of a limited liability company and a partnership firm. According to the regulations set by FEMA foreign investment up to 100% is permitted in LLPs operating in sectors that allow automatic route investments. LLPs are established at the level and registered under the Limited Liability Partnership Act of 2008. One of the advantages of an LLP is its ease of management as it entails regulatory and compliance requirements.
Foreign companies are allowed to set up branch offices in India for conducting business. These branch offices can perform all activities to the foreign parent company except for retail trading, manufacturing and processing activities. If the foreign parent company wishes to engage in manufacturing services it must outsource these services through subcontracting. However, if the foreign company has made a profit in the preceding five years in its home country or has a net worth of at least $100 000 it needs to seek prior approval, from the Reserve Bank of India (RBI) before establishing a branch office.
A liaison office acts as a communication hub between the foreign company and the Indian government enabling them to explore the feasibility of establishing a business in the country. However, a liaison office does not have the authority to enter into any agreements or contracts on behalf of its parent entity, nor does it have the authority to do business in India. It is only responsible for collecting information and providing it to the parent company.
Starting a business in India involves adhering to legal and regulatory obligations. This entails acquiring licenses and permits registering the business with the relevant authorities and ensuring compliance, with labor laws and tax regulations.
When starting a business in India it is crucial to complete the registration process with the appropriate authorities. In India, the prevalent forms of companies are private limited companies, public limited companies and limited liability partnerships (LLPs). As of January 2023, there were more than 1. 50 million registered companies, in India located in South Asia.
Depending on the type of business, various licenses and permits may be required. These could include a trade license, business registration certificate, and environmental clearance certificate. Some specific examples include Udyog Aadhar Registration, "Food Safety and Standards Authority of India" (FSSAI), Import Export Code and Shop and Establishment Act License. It is crucial to research and obtain all the required licenses and permits before commencing operations.
In India it is mandatory for all businesses to undergo registration procedures with the authorities. This involves registering with the Ministry of Corporate Affairs acquiring a PAN (Permanent Account Number) and TAN (Tax Deduction Account Number) from the Income Tax Department and enrolling for GST (Goods and Services Tax) and GSTIN registration. It is crucial to ensure that all the required registrations are duly completed prior, to commencing operations.
In India, businesses need to adhere to a variety of labor laws and tax regulations. This entails providing benefits like health insurance, paid leave, as well as paying taxes on profits. It is crucial to research and comprehend these regulations before commencing operations. Some of the laws include the Factories Act of 1948 the Contract Labor Act of 1970 the Building and Other Constructions Workers Act of 1996 and according to the Income Tax Act of 1961 it is mandatory for individuals with annual incomes, above the minimum exemption limit to pay income tax.
India has become a destination for foreign direct investors due to its economic reforms, strong economic growth and a young educated population. It currently holds the 68th position in the Global Competitive Index. In the year 2021-22 India experienced a record level of FDI inflows amounting to $ 84.80 billion. Sectors like information technology, telecommunications and automobiles were the beneficiaries of FDI during this period. Furthermore, the government has introduced schemes and policies to promote development. One such example is the production linked incentive (PLI) scheme launched in 2020 for electronics manufacturing, which aims to attract foreign investments. These initiatives offer incentives such as taxes, relaxed regulations and easy access to land resources for investors looking to establish their businesses in India. As a result there has been an increase, in job opportunities and overall economic growth.
India's infrastructure has been a major focus of the government in recent years, with a goal of improving connectivity and accessibility across the country.
India boasts one of the extensive road networks globally stretching across a staggering 5.8 million kilometers. The National Highways Authority of India (NHAI) holds the responsibility for the development, maintenance, and management of national highways. Numerous significant initiatives are currently in progress, such, as the Bharatmala Pariyojana, which seeks to enhance and expand 34,800 kilometers of highways throughout the nation.
The Indian Railways, divided into 18 zones ranks as the fourth largest railway network globally offering both passenger and freight services. As of March 2022 the IR network covers a track length of 128300 km with 102,830 km dedicated, to running tracks and a route length of 68040 km. The government is actively investing in modernizing and expanding railway infrastructure by introducing high speed trains and dedicated freight corridors. One notable project is the Delhi Mumbai Industrial Corridor (DMIC) aimed at establishing a high speed freight corridor connecting the capital region with Mumbai.
India has seen an increase in its airport infrastructure boasting a network of more than 100 operational airports. Additionally, there are airports currently being constructed or expanded. To improve air connectivity and make air travel more affordable the government has initiated the Regional Connectivity Scheme (UDAN). Noteworthy endeavors include the establishment of greenfield airports like the Navi Mumbai International Airport and the Jewar Airport, in Greater Noida.
India as a player in the global electricity market produces and consumes a substantial amount of power. With a generation of 1497 Terawatt hour (TWh) India ranks third in terms of both production and consumption. On average each person in India consumed 1 320 kWh of electricity in FY2023. The country relies on a range of energy sources such as coal, natural gas, hydroelectric power, nuclear power and renewable energy sources. In order to prioritize sustainability the government has implemented initiatives such as the Ultra Mega Power Plants (UMPPs) and the National Solar Mission. These are aimed at increasing the proportion of renewable energy, within the overall energy mix.
India boasts the world’s second largest population of mobile phone users exceeding a staggering 1. 2 billion subscribers and with more than 624 million individuals accessing the internet. To enhance mobile network access in regions the government has taken proactive measures like implementing the BharatNet initiative. Government's Digital India initiative aims to reduce the digital gap by making internet access affordable and accessible to all citizens. 5G networks are currently being tested in certain urban areas.
India possesses a wealth of natural resources and boasts a wide array of raw materials that cater to diverse industries. The nations geographic positioning and geological characteristics play a vital role in its ample reserves of minerals, metals and agricultural commodities. Some noteworthy raw materials found in India encompass iron ore, coal, bauxite, copper and wheat.
The availability of raw materials in India has a significant impact on various industries, including:
1. Automotive Industry
The Indian automotive industry has witnessed significant growth owing to the abundance of raw materials. With resources like steel, aluminum and rubber the country has emerged as a thriving hub for automobile manufacturing. From 2017-18 to 2021-22 crude steel production experienced a growth rate (CAGR) of 4.3% reaching 122 million metric tons. In India, refined aluminum production reached around 3.90 million tons in 2021. Moreover, India produced 770000 metric tons of natural rubber in the fiscal year 2022. This increased availability of materials has led to the expansion of existing automotive companies and the establishment of new ones. For instance, Tata Motors – one of India’s automobile manufacturers – recently announced plans to scale up its Sanand plant and boost its production capacity in response to the growing demand, for vehicles.
2. Textile Industry
The textile sector in India is greatly advantaged by the abundance of raw materials. India is renowned for its cotton production, which positions it as a significant participant in the worldwide textile industry. Around 68% of India’s cotton comes from rain fed regions while 35% originates from irrigated areas. In terms of productivity India ranks 38th globally with a yield of 510 kg/ha. The availability of cotton has enticed both domestic and international textile companies to establish manufacturing facilities, in India.
3. Steel Industry
India has become a major player in the global steel industry owing to its abundant reserves of iron ore and coal. The country holds a 35 billion tons of coking coal reserves. This availability of raw materials has attracted investments from both domestic and international steel companies leading to substantial growth in India’s steel sector. Renowned companies like Tata Steel and JSW Steel have expanded their production capacities to keep up with this growth. Furthermore, the presence of these materials has not only benefited the steel industry but has also supported the development of related sectors such, as construction and infrastructure.
The Indian government has taken measures and introduced several policies to facilitate and encourage the availability of raw materials, within the country. These initiatives have had a significant impact on various industries and the overall economy.
India is renowned for its time consuming bureaucratic processes, which can pose significant hurdles for businesses aiming to establish their presence in the country. From acquiring permits and licenses to adhering to labor laws dealing with paperwork and administrative procedures can feel overwhelming. Additionally India’s infrastructure encompassing its roads, ports and airports presents challenges for businesses seeking to operate within its borders. Substandard infrastructure can lead to delays, heightened expenses and logistical obstacles. Moreover, India’s rich diversity with its multitude of cultures and languages adds another layer of complexity, for businesses venturing into the country. It becomes crucial for them to understand and respect customs and practices in order to thrive in this diverse environment.
India’s attractive benefits are fueling the growth of established foreign businesses. With an expanding economy a large customer base and a skilled workforce India presents a multitude of opportunities for foreign companies to expand their operations and increase their market share. According to the Economist Intelligence Unit (EIU) India has shown improvement in its quarterly forecast for the most favorable business environments in the next five years. In the EIUs published Business Environment Ranking (BER) on April 13th this Asian country has climbed six positions globally and moved from the 14th spot to the 10th among 17 economies in Asia. Numerous international companies have invested in manufacturing units within India as part of the Make in India initiative. The Make in India campaign has now completed eight years resulting in a foreign direct investment (FDI) doubling to $ 83 billion. Some notable examples include Samsung, Xiaomi, Hyundai, Micron. These companies have expanded their manufacturing presence, in India to capitalize on its growing consumer market and leverage government initiatives aimed at promoting local manufacturing and production.
Xiaomi: India has recently revealed the establishment of another manufacturing plant, which brings the number of their manufacturing facilities to seven. As part of the Make in India initiative they have collaborated with Flex, an electronics manufacturing company to set up a facility spanning 1 million square feet in Chennai.
Micron: Micron, a computer storage chip manufacturer based in the United States recently revealed its plans to establish a semiconductor facility $2.75 billion in Sanand near Ahmedabad. This announcement makes Gujarat the pioneer state, in India to house such a semiconductor manufacturing facility.
The Indian government has implemented various initiatives to support the growth and diversification of established businesses. These initiatives provide benefits like tax exemptions, grants and other attractive incentives. Moreover, the government actively encourages businesses to invest in India by offering advantages such as access to untapped markets, affordable labor and various resources, across different sectors including;
Textile Sector
The Indian government has given its approval to the production linked incentive (PLI) schemes for the textiles sector with the aim of boosting manufacturing and exports of manmade fibers (MMF) garments and technical textiles. Over a span of 5 years this scheme will offer incentives Rs 10683 Crores to support the production of these goods. The implementation of the PLI scheme is expected to attract investment in this particular industry segment.
Production-Linked Incentive Scheme
In order to promote domestic manufacturing and reduce the reliance on imports the Indian government introduced a scheme called PLI in March 2020. This scheme aims to provide incentives to companies based on their increased sales from products manufactured within the country. India’s PLI Scheme for Textiles has selected 64 textile investors who're eligible to receive incentives over a period of five years. Notably seven foreign companies from countries such, as the US, Japan, South Korea, Israel, Germany and Sri Lanka have successfully applied through their subsidiaries. Gujarat is leading with the number of proposed projects while Madhya Pradesh has attracted the largest proposed investment.
Battery Subsidy: The Indian government is in the process of developing a substantial subsidy program for companies involved in producing electricity grid batteries. This initiative is part of their commitment to transitioning towards energy. As per a proposal, from the power ministry the draft scheme aims to provide a production linked incentive subsidy of 216 billion rupees ($2.63 billion) over the decade from this year until 2030. The primary objective is to encourage companies to establish battery cell manufacturing facilities within India. The Financial Times has shared these details in their report.
Pharmaceuticals Sector:
The pharmaceutical industry in India holds the position globally in terms of volume and is valued at $50 billion. India contributes 3.5% to the export of drugs and medicines supplying them to, over 200 countries worldwide. To strengthen the industry’s resilience against shocks ensure drug security and promote domestic production of essential bulk drugs and high value products the Department of Pharmaceuticals has introduced three supportive schemes such as The Production Linked Incentive (PLI) Scheme, Production Linked Incentive Scheme for Pharmaceuticals (PLI 2.0), Scheme for Bulk Drug Parks. These schemes aim to encourage both international players to invest more in these specific categories and increase their production capacity.
Semiconductor and Technology Sector:
The three day SemiconIndia 2023 event was launched by Prime Minister Shri Narendra Modi. In his speech he highlighted the significance of semiconductors in our daily lives and India’s commitment to developing a semiconductor manufacturing ecosystem through the Semicon India Programme. He also mentioned that technology companies will receive 50 percent support for establishing semiconductor manufacturing facilities in the country. To foster a semiconductor ecosystem in India the government has announced subsidies totaling ₹76 000 crore ( $10 billion). Along with investments that match this amount this initiative will bring about $30 billion in total investments. Furthermore the Prime Minister discussed the growth of India’s electronic manufacturing sector, which has expanded from $30 billion to over $100 billion. He also mentioned the rise in exports of manufacturing products from India and highlighted the presence of more, than 200 mobile manufacturing units operating within the country.
India has entered into various agreements known as Social Security Agreements (SSAs) in order to simplify the social security responsibilities of workers who cross borders or work internationally. These agreements provide incentives, such as the ability to work temporarily in another country, the transferability of pension benefits the combination of benefits from multiple countries and the ability to withdraw social security benefits. As of 2023 India has signed SSAs with 20 countries, including Belgium, Germany, Switzerland, Denmark, Norway, Luxembourg, France, South Korea, Netherlands and Hungary among others. These SSAs offer three benefits for international workers and nonresident Indians (NRIs); temporary work opportunities in other countries (detachment) the ability to transfer pension benefits between countries (exportability) and the possibility of combining social security benefits, from different countries (totalization).
India boasts one of the extensive networks of tax treaties aimed at avoiding double taxation and combating tax evasion. The country has established Tax Avoidance Agreements (DTAAs) with more than 85 other nations. The primary objective of these tax treaties is to establish a just system for determining which country has the right to tax different types of income based on whether it originates from the 'source' or 'residence' country. Through DTAAs taxpayers are safeguarded against being taxed and any hindrances to the smooth flow of international trade, investment and technology transfer between two nations are prevented. Companies operating in countries that have a DTAA with India can benefit from more favorable provisions and rates available, under both the IT Act and the respective DTAA.
Government assistance plays a crucial role in nurturing the advancement and progress of businesses in India. The government offers a range of subsidies, advantages and incentives to stimulate entrepreneurship and investment, within the nation. These endeavors strive to forge a business atmosphere, foster economic expansion and entice both local and foreign investors.
Funding Programs
The Indian government offers various funding programs to support startups. These programs provide financial assistance to startups at different stages of their growth. Some popular funding programs include:
Incubators
The Indian government has established incubators to nurture and support startups. These incubators provide infrastructure, mentorship, and networking opportunities to startups. Some well-known incubators include:
Mentorship Initiatives
The Indian government has implemented mentorship initiatives to guide and support startups. These initiatives connect startups with experienced mentors who provide guidance and advice. Some notable mentorship initiatives include:
These subsidies, grants, and initiatives aim to foster innovation and entrepreneurship in India by providing startups with the necessary support and resources to succeed.
1. Corporate Tax Rates
India provides businesses with corporate tax rates, which can help alleviate the overall tax burden. Currently, domestic companies are subject to a 25% corporate tax rate while foreign companies face a 40% rate. These rates are comparatively lower, than those of other countries making India an appealing investment destination.
2. Tax Holidays
The Indian government offers tax holidays to certain industries and businesses in order to stimulate investment and foster economic development. These tax holidays typically last for a period of 5 to 10 years during which eligible businesses are exempted from paying income tax. This can substantially alleviate the tax responsibilities for startups and also serve as an incentive for foreign investors to establish their businesses in India.
3. Special Economic Zones (SEZs)
India has set up Special Economic Zones (SEZs) with the aim of attracting foreign investment and boosting exports. Enterprises that operate within these SEZs enjoy a range of tax benefits and exemptions including being relieved from customs excise duties, central excise duties and service tax. Moreover, companies based in SEZs are entitled to a reduced corporate tax rate of 15% for the five years gradually increasing thereafter. These specialized zones provide an environment for businesses to thrive and significantly enhance their competitiveness, in the global market.
India possesses a varied workforce consisting of population more than 1.40 billion individuals. The rate of people actively participating in the labor force is relatively elevated showcasing a number of individuals actively seeking employment opportunities. Unemployment rates within India fluctuate among regions and sectors. On the whole the nation has encountered levels of unemployment particularly among young people and in rural areas. Government initiatives and skill development programs are being implemented to tackle this concern, with dedication and resolve.
The minimum wage in India differs depending on the state and industry. Its purpose is to guarantee that workers are fairly paid for their work. India has the competitive labor costs in Asia with a national minimum daily wage of around INR 170 (equivalent to US$2.10) which amounts to approximately INR 5350 (, around US$66) per month.
The average wages in different industries in India can vary significantly. In India men earn a salary of INR 1953000 while women earn an average salary of INR 1516200. Industries such as IT, finance and healthcare tend to offer salaries whereas sectors, like agriculture and construction often have lower average wages.
India has a significant role to play in global affairs and has been actively engaged in fostering diplomatic ties with other nations. Leveraging its cultural heritage, robust economy and strategic geographical position, India has established itself as a prominent player, on the world stage.
Openness to Foreign Investment
India has made several changes to attract foreign investment, such as relaxing its FDI policies and reducing limitations on foreign ownership in different industries. This openness approach towards foreign investment has opened up many possibilities for global companies to set up operations in India and contribute to its economic development.
Promotion of Trade and Economic Cooperation
India is actively working towards promoting trade and economic cooperation with nations. They have entered into bilateral and regional trade agreements, aimed at improving market access and reducing barriers to trade. Furthermore, India has set up platforms and initiatives like the India ASEAN Free Trade Agreement and the Comprehensive Economic Cooperation Agreement to strengthen economic ties and facilitate smooth trade, between India and its trading partners.
United States
India and the United States share a strategic partnership in defense, technology and trade. Both nations work together on projects to enhance their bilateral relationship. As of 2020, the United States has approved defense sales worth than $20 billion, to India.
Russia
India and Russia share an enduring strategic alliance especially in the field of defense. This partnership is based on the Agreement on the Programme for Military Technical Cooperation, which was signed by both nations. They work together on defense initiatives conduct military exercises and exchange technology.
Japan
India and Japan share strategic partnership that centers around collaborating on economic initiatives transferring technology and advancing infrastructure. A significant catalyst, for their thriving trade relationship has been the 2011 CEPA trade agreement, which has contributed to their trade volume reaching a noteworthy $ 21.96 billion during the fiscal year of 2022-23.
Australia
India and Australia share an alliance encompassing collaboration in defense, trade and education. In June 2020 the two nations upgraded their relationship to a strategic partnership and reached a significant agreement enabling reciprocal access to military bases, for logistical support.
Peacekeeping Missions
India has played a vital role, in United Nations peacekeeping missions by actively participating for a considerable period. Indian peacekeepers have been deployed in areas of conflict worldwide working diligently to uphold peace and ensure stability.
Counterterrorism Efforts
India has actively participated in counterterrorism initiatives collaborating closely with global partners in the fight against terrorism. With experience, as a victim of terrorism India recognizes the significance of collective efforts to tackle this global menace.
Maintaining Regional Stability
India plays a crucial role in upholding regional stability in South Asia. It actively participates in diplomacy to address conflicts and foster peaceful relationships with its neighboring nations. The commitment of India towards stability is vital for promoting economic progress and growth, within the region.
Our go-to-market strategy for international businesses entering the Indian market is specifically designed to assist companies in navigating the intricate and ever changing market landscape of India. We offer an approach that encompasses market analysis, localization and collaborations to ensure a smooth entry into the Indian market. Our team of professionals possesses extensive knowledge about the Indian market enabling them to help businesses overcome any cultural or regulatory obstacles they may encounter. Through our approach businesses can accomplish their objectives and expand their presence within the Indian market successfully. We provide a range of comprehensive services, including assistance with entry strategies and compliance with regulations. Our team of experts boasts an in depth understanding of the business environment allowing us to deliver tailored advice and guidance that caters specifically, to our clients’ needs and maximizes their chances of success.
