What India Wants: Foreign Investment in the New Asian Tiger

Since 1991, when former Financial Minister Manmohan Singh introduced liberal and deregulating economic reforms, India has lowered its trade barriers and tax rates, broken state-run industries and encouraged competition. In short, India has opened up to the rest of the world. While some have argued that the pace of reforms has been slow, India is now primed for change and growth, especially given Mr. Singh’s May 2009 victory to take on a second five-year term as prime minister of the country.

There has never been a time like now to invest. Not only is India the fourth largest economy in the world in terms of purchasing power parity, it also has an abundant, high-quality, cost-effective young workforce and booming domestic demand. The country has a pervasive air of entrepreneurship, well-developed banking system and a liberal policy on technology collaboration. The government has introduced a plethora of reforms to encourage FDI including the opening of many new sectors, raising foreign investment equity caps in sectors already opened and implementing procedural simplification.

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