Business in India
Investment in India - Investing in India - Venturing into the Indian Market
Investment in Indian market
India, among the European investors, is believed to be a good investment
despite political uncertainty, bureaucratic hassles, shortages of power and
infrastructural deficiencies. India presents a vast potential for overseas investment
and is actively encouraging the entrance of foreign players into the market.
No company, of any size, aspiring to be a global player can, for long ignore
this country which is expected to become one of the top three emerging economies.
Success in India
Success in India will depend on the correct estimation of the country's
potential, underestimation of its complexity or overestimation of its possibilities
can lead to failure. While calculating, due consideration should be given to
the factor of the inherent difficulties and uncertainties of functioning in
the Indian system.Entering India's marketplace requires a well-designed plan
backed by serious thought and careful research. For those who take the time
and look to India as an opportunity for long-term growth, not short-term profit-
the trip will be well worth the effort.
India is the fifth largest economy in the world (ranking above France, Italy,
the United Kingdom, and Russia) and has the third largest GDP in the entire
continent of Asia. It is also the second largest among emerging nations. (These
indicators are based on purchasing power parity.) India is also one of the few
markets in the world which offers high prospects for growth and earning potential
in practically all areas of business.Yet, despite the practically unlimited
possibilities in India for overseas businesses, the world's most populous democracy
has, until fairly recently, failed to get the kind of enthusiastic attention
generated by other emerging economies such as China.
of enthusiasm among investors
The reason being, after independence from Britain 50 years ago, India
developed a highly protected, semi-socialist autarkic economy. Structural
and bureaucratic impediments were vigorously fostered, along with a distrust
of foreign business. Even as today the climate in India has seen a seachange,
smashing barriers and actively seeking foreign investment, many companies
still see it as a difficult market. India is rightfully quoted to be an incomparable
country and is both frustrating and challenging at the same time. Foreign
investors should be prepared to take India as it is with all of its difficulties,
contradictions and challenges.
Developing a basic understanding or potential of the
Indian market, envisaging and developing a Market Entry Strategy and implementing
these strategies when actually entering the market
are three basic steps
to make a successful entry into India.
Developing a basic understanding or potential of the Indian market
The Indian middle class is large and growing; wages are low; many workers
are well educated and speak English; investors are optimistic and local stocks
are up; despite political turmoil, the country presses on with economic reforms.But
there is still cause for worries-
The rapid economic growth of the last few years has put heavy stress on
India's infrastructural facilities. The projections of further expansion in
key areas could snap the already strained lines of transportation unless massive
programs of expansion and modernization are put in place. Problems include
power demand shortfall, port traffic capacity mismatch, poor road conditions
(only half of the country's roads are surfaced), low telephone penetration
(1.4% of population).
Although the Indian government is well aware of the need for reform and
is pushing ahead in this area, business still has to deal with an inefficient
and sometimes still slow-moving bureaucracy.
The Indian market is widely diverse. The country has 17 official languages,
6 major religions, and ethnic diversity as wide as all of Europe. Thus, tastes
and preferences differ greatly among sections of consumers.
it is advisable to develop a good understanding of the Indian market and overall
economy before taking the plunge. Research firms in India can provide the
information to determine how, when and where to enter the market. There are
also companies which can guide the foreign firm through the entry process
from beginning to end --performing the requisite research, assisting with
configuration of the project, helping develop Indian partners and financing,
finding the land or ready premises, and pushing through the paperwork required.
Developing up-front takes:
Is there a need for the products/services/technology? What is the probable
market for the product/service? Where is the market located? Which mix of
products and services will find the most acceptability and be the most likely
to generate sales? What distribution and sales channels are available? What
costs will be involved? Who is the competi
on Economic Policies
The general economic direction in India is toward liberalization and globalization.
But the process is slow. Before jumping into the market, it is necessary to
discover whether government policies exist relating to the particular area of
business and if there are political concerns which should be taken into account.
Click here for more information about Business