First, I want to state that India has a lot to offer as a country. There are also a number of great people. I’d risk to say that the vast majority of Indian people are honest and hardworking. However, business environment in India is still under development. That is an indisputable fact, and there are number of problems. The followings are some of problems of running a business in India.

Banking sector has a couple of problems. To be more specific, those who work in the banking sector are not exactly a problem. My guess is that most of them are honest and hardworking; they’re probably also quite talented, intelligent and capable. However, there are too many formalities and procedures than necessary. For example, it took nearly two weeks for me to open a bank account in India, while I opened the account at India’s premier bank, ICICI. There were a couple of reasons why it took two weeks, but it is unusually a long time to open a bank account despite that. I opened several bank accounts, including a business bank account, in US over the years, but it only took one day to open each bank account. I had to transfer a fund from my US business account to the new bank account in India; it took two weeks. There were a couple of reasons why it took two weeks, but it is also a long time to transfer a fund; these exemplify problems of the banking sector.

There is maƱana mentality not in the sense that everyone is playing and partying everyday and not getting things done but in the sense that things do not get done on time. For example, I essentially delegated several administrative tasks to a couple of Indian people; they are very capable but they don’t always get things done on time. One time, I asked to get me a doorbell for my flat (apartment) to one of them because it was very difficult for me to get this done since I did not speak Hindi; I probably asked this two months ago. I still do not have the doorbell. I know him pretty well and I know that he has a very hectic schedule; however, two months is a long time for anyone to get a doorbell. This particular task is nothing urgent, so I am not upset about it, but something like this happens often.

Lack of the basic infrastructure stands out. Electricity problem is very visible. Electricity goes off a couple of times a day on average even during winter, while Indian people use less electricity during winter than during any other season. Using UPS (Uninterruptible Power Supply), you can prevent data loss, but if you run a kind of business that requires you to use electricity the whole time that you work such as web development, you have zero productivity when electricity is off. Water supply problem is there, though it is not severe; most businesses, specifically businesses in the service sector, do not suffer from the problem because they typically do not use water to run their businesses, but it can become a minor problem. Internet connection works for the most part, but the connection gets cut off occasionally. This can result in the loss of productivity also.

Most problems can be managed, and as a matter of fact, I am running an internet business in India. However, problems described here are recognizable and they do affect. Those of you who plan to set up an operation in India should remember these problems. Chances are these problems will be there for some time.



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