Despite the present Covid-19 crisis and the economic slowdown, India has emerged as one of the top three choices for overseas investments in the next 2-3 years, as per the FDI survey released by the Confederation of Indian Industry (CII), in association with EY.
The CII-EY FDI survey on the theme, ‘How can India step up its game?’ has been published to understand the current market sentiment amongst the Indian and Foreign MNCs.
As per the survey results, more than half of the respondents choose India amongst the top three economies or leading manufacturing destinations of the world by 2025. Also, 25% of the respondents, comprising of non-Indian HQ MNCs, view India as the first choice for future investments. The survey shows that more than 80% of all the respondents and 71% of the non-Indian HQ respondents plan to invest globally in the next 2-3 years.
Reasons for choosing India for overseas investment:
The top three reasons to choose India as a favorable destination by the respondents are its market potential, skilled workforce, and political stability. Other key factors that were the top drivers for fresh investments into India are cheap labor availability, policy reforms like corporate tax cuts, simplification of labor laws, FDI reforms, focus on human capital, and availability of raw materials.
The respondents suggested a few areas for improvement to the government. The top three issues include Infrastructure development, faster clearances, and proper implementation of improved labour laws and labor availability.
The CII-EY survey results strongly suggest that India will be the next global investment hotspot with a high proportion of MNCs placing it at the top of their investment agenda. It can be attributed to the recent major structural reforms, proactive Government processes, and the quick pickup in economic activity following Unlock measures.
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