INDIA CAPTIVATES
Outpacing the competition
A leading 32 % of international investors ranked India as the most attractive market , while 60 % placed the country among the top three investment destinations . Respondents believe that ongoing economic reforms are increasing opportunities for them to develop their companies profitably in India . Enthusiasm is strongest among companies with annual revenue exceeding US $ 2b . Overall , 71 % of respondents from big companies think India will be more attractive than other regions . Respondents who already have business activities in India are more confident about the country ’ s attractiveness , perhaps an indication of its real potential and equally of its relatively low awareness among those not invested in the country . Among those who are not established in India , 35 % rank India their most attractive option , though they place it second only to China ( which 47 % see as their preferred investment destination ). Although China ’ s economic growth is slowing , it has a huge internal market , a broad manufacturing base and a 30-year record of strong growth . International investors , however , are increasingly looking at India as an investment destination — to manufacture for the domestic and global market , as a center for shared services , and as a regional and a global hub for operations .
Low labor costs
India ’ s most attractive feature for foreign investors is abundant labor . According to the UN Conference on Trade and Development , India ’ s workforce will reach 557 million by 2020 , even as the global labor market tightens . To reinforce this labor cost advantage , the Indian Government is aiming to improve labor skills . Its National Skill Development Policy 2015 aims to ensure one Indian in four has skills appropriate to the labor market by 2020 , and there are plans to open 1,500 more industrial training institutes and 5,000 skill development centers across the country .
A huge and increasingly prosperous market
With 1.26 billion people and growing , India will surpass China and become the world ’ s most populous nation by 2022 . Last year , household incomes increased on average by 10 %. By 2020 , India ’ s per capita income ( by purchasing power parity ) is expected to rise 59 %, outpacing spending-power growth in the US ( 23 %), the UK ( 22 %), Brazil ( 12 %) and Russia ( 12 %). And even as China ’ s population starts to shrink , India ’ s looks set to go on growing : the country has 356 million young population aged 10 to 24 , a number that exceeds the entire population of the US ( 319 million ).
Greater political and macroeconomic stability
The election of a pro-reform Government with a clear majority has encouraged investors . As compared with 59 % in the previous year , 74 % of them rated India ’ s political stability as attractive . Investors are also much more confident now about India ’ s economic stability . The Government ’ s ongoing
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