Business reports declare India to be performing pretty well in business in the last five years. It has delivered a gross rate of 9.2, which according to economists, is deemed to be one of the fastest in a global perspective. On the other side of the coin, however, the increase of supply currency relating to the availability of goods and services has risen at evenly rapid pacing at almost 7%. The last two years saw India’s worse surplus deficit showcasing a continuous gap between supply and demand. The question as to whether or not there are greater risks of doing business in India remains dependent on which field of the economy is being ventured into.
It’s true that while some economists see the advantages of investing in Asia, a few others have foreseen risks of doing business in India. Generally, there are good and bad sides of establishing business infrastructures in a country where population is seemingly at its peak. Known to be a populated country, India is still experiencing scarcity of highly qualified workers as a result of insufficient educational system. This can be a risk in the part of the investor who wants good quality of employees to uplift the company’s performance. In addition, this is also a reason why wage rates are increasing while destroying the cost advantage.
If you are to look at the positive side of investing in India, you are likely to credit some Indian companies like Tata Steel, GHCL and VSNL that have recently obtained US counterparts. Although they are tiny segments of the whole economy but they pursue to sustain and become great players in the global market. This is just indicator that commercial leadership in the West has started to transcend in newly built companies in India. But risks in doing business in India are still in the picture and they continue to make investors hold back from taking huge deals on putting up business infrastructures. What is apparent in the nation is that infrastructures like airports, roads and seaports require immediate enhancements while education and health care facilities are to be given much attention. Without attaining these things, the state of business infrastructure remains to be in worse conditions.
Although outsourcing in information technology is becoming a phenomenon in India, it doesn’t promise a great picture of trade and commerce. Speaking of risks in doing business in India, corruption in government and cultural difference can be pointed out as some. Corruption certainly adds up to the challenges in business decision-making and further transactions for US companies especially when business ethics are at stake. The malady of having to deal with millions of backlog ethic-related issues and unfriendly labor laws may be potential sources of disagreements.
Ian Pennington is an accomplished niche website developer and author.