Advantages of investing in India

India has a scientific and technical workforce of 20 million people, more than the population of Taiwan. The number of literates in India is greater than the combined population of France and Japan. India has a vast domestic market: a middle class population of 300 million people with substantial purchasing power and another population of 700 million people whose purchasing power is gradually increasing. Being a vibrant democracy with a large democratic setup complemented by a broad-based legal framework that includes arbitration and an independent judicial system, it boasts a vast network of bank branches, financial institutions, and well-organized capital and money markets. These attributes make India a favorable destination for NRI investments.

India also has a huge network of technical and management institutions of the highest international standard for the development of excellent human resources. India has an enviable record of meeting its international financial obligations and has never defaulted. The country has a strong English language base for business purposes. The strong and vibrant small-scale sector is good enough to establish strategic alliances with its foreign counterparts. The country’s strategic location in the context of third world markets, particularly the fast-growing markets of South and Southeast Asia, coupled with a supporting infrastructure base, help promote a healthy environment for NRI entries into the country.

India has more billionaires than China. This year there are 15 billionaires in China but last year in India there were 20 billionaires, according to Forbes magazine. India has emerged as the world’s fastest growing wealth creator, thanks to a buoyant stock market and higher profits. Several Indian companies outperformed last year’s net profit in just six months of the current fiscal year, reflecting accelerating corporate profits. 44% percent of the top 100 Fortune 500 companies are present in India. With its manufacturing and service sectors on a breakneck growth path, India’s economy could soon reach the coveted 10 percent figure.

The Indian diaspora business has become hot lately. The government has always assiduously courted non-resident Indians to attract more flows. Apart from the money transfer business, which compared to the money invested in India is smaller; the Center is doing everything it can to persuade the NRIs to pump money into the country like never before. And it has been superlatively successful in recent years. The Prime Minister of India has announced dual citizenship for people of Indian origin. He has given a tremendous boost to the NRI community around the world. With recruitment levels for overseas jobs skyrocketing, there is scope for more money to come into India. According to a recent Business Standard report, in the last three years, 850,000 people went to West Asia alone. And even though the official number of Indians living in the US is 2 million, unofficial estimates put it at 3.5 million. And emigration to Canada and Australia continues to grow.

The ministries involved have ensured that rules and regulations are streamlined to facilitate flows. Where does the government see the money being invested? NRIs can invest in bank deposits and company deposits. They are subject to different rules; The schemes allow investments with and without repatriation facilities. From now on, NRIs can make direct investments in partnerships and property companies in the country. This, NRIs can do by subscribing for shares or bonds of Indian companies. In addition, they can now also place funds in company deposits. NRIs that undertake never to seek repatriation of capital invested in India and income derived therefrom may invest on a non-repatriation basis. NRIs also have the option to invest in mutual funds issued by domestic public sector and non-repatriation private sector mutual funds.

All they have to do is submit their applications to the Reserve Bank. They can now also invest in mutual money market funds (MMMF) issued by commercial banks and financial institutions with the authorization of the main bank or the Securities and Exchange Board of India (Sebi), the market regulator. Yet another option is to invest in securities of the Central or State Government and the National Plan/Savings Certificates by making remittances from abroad or with funds from your NRE/FCNR accounts. Indeed, with regulations easing, compared to the scene some 7-8 years ago, non-resident Indians today have more options to invest their hard-earned money in India. And, to make things easier and hassle-free, the government is doing its best to persuade Indians who earn a lot of money away from home to park their funds here. However, it is commendable that the Indian diaspora has also begun to believe that it is better to channel their money home, thus contributing to the development process of the nation to which they truly belong.