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India Country Profile
General Profile
Total area 3,287,263 sq km
Population 1,205,073,612 (July 2012 est.)
World Population (in billions)
2007 2008 2009 2010 2011 Growth YoY
6.6 6.7 6.8 6.9 7.0 1%
Government type federal republic
Chief of state Mr Pranab Mukherjee
Head of government
Mr. Manmohan SINGH
Capital New Delhi
Climate varies from tropical monsoon in south to temperate in north
Language
Hindi 41%, Bengali 8.1%, Telugu 7.2%, Marathi 7%, Tamil 5.9%, Urdu 5%, Gujarati 4.5%, Kannada 3.7%, Malayalam 3.2%, Oriya 3.2%, Punjabi 2.8%, Assamese 1.3%, Maithili 1.2%, other 5.9%
Major City
NEW DELHI (capital) 21.72 million; Mumbai 19.695 million; Kolkata 15.294 million; Chennai 7.416 million; Bangalore 7.079 million (2009)
Economy Profile
2009 2010 2011
World GDP Real Growth
-0.8% 5% 3.6%
World GDP (in Trillions)
58.1 63.3 70.2
IndiaGDP Real Growth
6.8% 10.1% 7.8%
GDP $1.843 trillion (2011 est.)
GDP – Per capita $3,700 (2011 est.)
Country Profile
Politics
Economy
Trade & Industries
INDIA
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GDP – Composition by sector
agriculture: 18.1%
industry: 26.3%
services: 55.6% (2011 est.)
Inflation 6.8% (2011 est.)
Exchanges Rates
Indian rupees (INR) per US dollar -
44.64 (2011 est.)
Primary Economy Sector
Information Technology
Information Technology Enabled Services
Telecommunications
Electronics and hardware
Automobiles
Pharmaceuticals and biotechnology
Consumer durables
Retail
Textiles
Infrastructure
Construction
Airlines
Hospitality
Power
Oil and natural gas
Fertilizers and chemical
Unemployment Rate
9.8% (2011 est.)
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Ports and
Terminals
Chennai, Jawaharal Nehru Port, Kandla, Kolkata (Calcutta), Mumbai (Bombay), Sikka, Vishakhapatnam
International
Airports
Indira Gandhi International Airport (Delhi), Chennai International Airport
(Chennai), Chhatrapati Shivaji International Airport (Mumbai), Netaji
Subhash Chandra Bose International Airport (Calcutta)
Election results
People's Assembly - percent of vote by party - NA; seats by party - INC 206, BJP 116, SP 23, BSP 21, JD (U) 20, AITC 19, DMK 18, CPI-M 16, BJD 14, SS 11, AIADMK 9, NCP 9, other 61, vacant 2; note - seats by party as of December 2011 - INC 208, BJP 115, SP 22, BSP 21, JD(U) 20, AITC 18, DMK 18, CPI(M) 16, BJD 14, SS 14, AIADMK 9, NCP 9, TDP 6, RLD 5 other 49, vacant 1
Ministry Name
Menteri/ Departemen Nama Pejabat
Prime Minister and also In-Charge
of the Ministries/Departments viz:
Ministry of Personnel, Public
Grievances and Pensions
Ministry of Planning
Department of Atomic Energy
Department of Space
: Dr. Manmohan Singh
Minister of Finance : Shri Pranab Mukherjee
Minister of Agriculture and Food
Processing Industries
: Shri Sharad Pawar
Minister of Defence : Shri AK Antony
Minister of Home Affairs : Shri P. Chidambaram
Minister of Railways : Shri Dinesh Trivedi
Minister of External Affairs : Shri SM Krishna
Minister of Micro, Small and
Medium Enterprises
: Shri Virbhadra Singh
Minister of Earth Sciences
Minister of Science and
Technology
: Shri Vilasrao Deshmukh
Minister of Health and Family
Welfare
: Shri Ghulam Nabi Azad
Minister of Power : Shri Sushil Kumar Shinde
Minister of Corporate Affairs : Shri M. Veerappa Moily
Minister of New and Renewable
Energy
: Dr. Farooq Abdullah
Minister of Petroleum and Natural
Gas
: Shri S. Jaipal Reddy
Minister of Urban Development : Shri Kamal Nath
Minister of Overseas Indian
Affairs
: Shri Vayalar Ravi
Ministry of Steel : Shri Beni Prasad Verma
Minister of Drinking Water and
Sanitation
Minister of Rural Development
: Shri. Jairam Ramesh
Minister of Information and
Broadcasting
: Smt. Ambika Soni
Minister of Labour and
Employment
: Shri Mallikarjun Kharge
Minister of Human Resource
Development,
: Shri Kapil Sibal
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Minister of Communications and
Information Technology
Minister of Textiles
Minister of Commerce and
Industry
: Shri Anand Sharma
Minister of Road Transport and
Highways
: Shri CP Joshi
Minister of Housing and Urban
Poverty Alleviation and Minister
of Culture
: Kum. Selja
Minister of Tourism : Shri Subodh Kant Sahay
Minister of Shipping : Shri GK Vasan
Minister of Water Resources and
Minister of Parliamentary Affairs
: Shri Pawan K. Bansal
Minister of Panchayati Raj and
Minister of Tribal Affairs
: Shri V. Kishore Chandra
Deo
Minister of Chemicals and
Fertilizers
: Shri MK Alagiri
Ministry of Coal : Shri Sriprakash Jaiswal
Minister of Minority Affairs and
Minister of Law and Justice
: Shri Salman Khursheed
Ministry of Heavy Industries &
Public Enterprises
: Shri Praful Patel
Minister of Civil Aviation : Shri Ajit Singh
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Political parties and leaders
All India Anna Dravida Munnetra Kazhagam or AIADMK [J.
JAYALALITHAA]; All India Trinamool Congress or AITC [Mamata
BANERJEE]; Bahujan Samaj Party or BSP [MAYAWATI]; Bharatiya Janata
Party or BJP [Nitin GADKARI]; Biju Janata Dal or BJD [Naveen PATNAIK];
Communist Party of India or CPI [A.B. BARDHAN]; Communist Party of India-
Marxist or CPI-M [Prakash KARAT]; Dravida Munnetra Kazhagam or DMK
[M.KARUNANIDHI]; Indian National Congress or INC [Sonia GANDHI];
Janata Dal (United) or JD(U) [Sharad YADAV]; Nationalist Congress Party or
NCP [Sharad PAWAR]; Rashtriya Janata Dal or RJD [Lalu Prasad YADAV];
Rashtriya Lok Dal or RLD [Ajit SINGH]; Samajwadi Party or SP [Mulayam
Singh YADAV]; Shiromani Akali Dal or SAD [Parkash Singh BADAL]; Shiv
Sena or SS [Bal THACKERAY]; Telugu Desam Party or TDP [Chandrababu
NAIDU]
India Economy
Overview
India is developing into an open-market economy, yet traces of its past autarkic
policies remain. Economic liberalization, including industrial deregulation,
privatization of state-owned enterprises, and reduced controls on foreign trade
and investment, began in the early 1990s and has served to accelerate the
country's growth, which has averaged more than 7% per year since 1997. India's
diverse economy encompasses traditional village farming, modern agriculture,
handicrafts, a wide range of modern industries, and a multitude of services.
Slightly more than half of the work force is in agriculture, but services are the
major source of economic growth, accounting for more than half of India's output,
with only one-third of its labor force. India has capitalized on its large educated
English-speaking population to become a major exporter of information
technology services and software workers. In 2010, the Indian economy
rebounded robustly from the global financial crisis - in large part because of
strong domestic demand - and growth exceeded 8% year-on-year in real terms.
However, India's economic growth in 2011 slowed because of persistently high
inflation and interest rates and little progress on economic reforms. High
international crude prices have exacerbated the government's fuel subsidy
expenditures contributing to a higher fiscal deficit, and a worsening current
account deficit. Little economic reform took place in 2011 largely due to
corruption scandals that have slowed legislative work. India's medium-term
growth outlook is positive due to a young population and corresponding low
dependency ratio, healthy savings and investment rates, and increasing
integration into the global economy. India has many long-term challenges that it
has not yet fully addressed, including widespread poverty, inadequate physical
and social infrastructure, limited non-agricultural employment opportunities,
scarce access to quality basic and higher education, and accommodating rural-to-
urban migration.
Trade Policy
1. Maintaining fiscal discipline
2. Orientation of public expenditure towards sectors in which India is
faring badly such as health and education.
3. Introduction of reforms in labour laws to generate more employment
opportunities for the growing population of India.
4. Reorganization of agricultural sector, introduction of new technology,
reducing agriculture's dependence on monsoon by developing means of
irrigation.
5. Introduction of financial reforms including privatization of some
public sector banks.
Investment Policy
Investments in Bank Fixed Deposits (FD)
Fixed Deposit or FD is accrues 9.25% of annual returns for non-senior citizen,
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depending on the bank's tenure and guidelines, which makes it's widely sought
after and safe investment alternative. The minimum tenure of FD is 15 days
and maximum tenure is 5 years and above. Senior citizens are entitled for
exclusive rate of interest on Fixed Deposits, current rate of return is average
10% annual.
Insurance features among the best investment alternative as it offers services
to indemnify your life, assets and money besides providing satisfactory and
risk free profits. Indian Insurance Market offers various investment options
with reasonably priced premium. Some of the popular Insurance policies in
India are Home Insurance policies, Life Insurance policies, Health Insurance
policies and Car Insurance policies.
Some top Insurance firm in India under whom you can buy insurance scheme
are LIC, SBI Life, ICICI Prudential, Bajaj Allianz, Birla Sunlife, HDFC
Standard Life, Reliance Life, Max NewYork Life, Metlife, Tata AIG, Kotak
Mahindra Life, ING Life Insurance, etc.
)
National Saving Certificate (NSC) is subsidized and supported by government
of India as is a secure investment technique with a lock in tenure of 6 years.
There is no utmost limit in this investment option while the highest amount is
estimated as ` 100. The investor is entitled for the calculated interest of 8%
which is forfeited two times in a year. National Saving Certificate falls under
Section 80C of IT Act and the profit accrued by the investor stands valid for
tax deduction up to ` 1, 00,000.
estments in Public Provident Fund (PPF)
Like NSC, Public Provident Fund (PPF) is also supported by the Indian
government. An investment of minimum ` 500 and maximum INR. 100,000 is
required to be deposited in a fiscal year. The prospective investor can create it
PPF account in a GPO or head post office or in any sub-divisions of the
nationalized bank.
PPF also falls under Section 80C of IT Act so investors could gain income tax
deduction of up to ` 1, 00,000. The rate of interest of PPF is evaluated yearly
with a lock in tenure of maximum 15 years. The basic rate of interest in PPF is
8%.
ments in Stock Market
Indian Stock market is very fluctuating. A smart portfolio positioned for long-
term growth includes strong stocks from different industries. Before investing
in stock market one should be prepared to assume risk equivalent to sum
invested in the market. Investing in share market yields higher profits.
Influenced by unanticipated turn of market events, stock market to some
extent cannot be considered as the safest investment options. However, to
accrue higher gains, an investor must update himself on the recent stock
market news and events.
Mutual Fund firms accumulate cash from willing investors and invest it in
share market. Like stock market, mutual fund investment are also entitled for
various market risks but with a fair share of profits. One should select mutual
fund schemes based on all or some of the following criteria:
Long term and Short Term Performance
Consistency in Returns
Performance during bullish and bearish phases
Fund Managers performance with the fund's operations
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A simple way to select a mutual fund scheme to invest in is to select a 5 star
or 4 star rated fund from one of the following rating agencies:
ICRA Ratings
Value Research Online
Moneycontrol
eme
Controlled by SBI, Gold Deposit Scheme was instigated in the year 1999.
Investments in this scheme are open for trusts, firms and HUFs with no
specific upper limit. The investor can deposit invest minimum of 200 gm in
exchange for gold bonds holding a tariff free rate of interest of 3% - 4% on the
basis of the period of the bond varying with a lock in period of 3 to 7 years.
Moreover, Gold bonds are not entitled of capital gains tax and wealth tariff.
The sum insured can be accrued back in cash or gold, as per the investor's
preference.
Indian real estate industry has huge prospects in sectors like commercial,
housing, hospitality, retail, manufacturing, healthcare etc. Calculated realty
demand for IT/ITES industry in 2010 is estimated at 150mn sq.ft. around the
chief Indian cities. Termed as the "money making industry", realty sector of
India promises annual profits of 30% to 100% through real estate investments.
Private equity is a type of asset consisting of equity securities in private
companies that are not publicly traded on stock exchange.
A private equity investment will generally be made by a private equity firm, a
venture capital firm or an angel investor.
Private Equity is expanding at a fast pace. India acquired US $13.5 billion in
2008 under equity shares and featured among the top 7 nations in the world. In
2010, the total equity investment is predicted to increase upto USD 20 billion.
Indian equities promise satisfactory returns and have more than 365 equity
investments firms functioning under it.
As ranked by the PEI 300, the 10 largest private equity firms in the world are:
1.TPG Capital
2.Goldman Sachs Principal Investment Area
3.The Carlyle Group
4.Kohlberg Kravis Roberts
5.The Blackstone Group
6.Apollo Global Management
7.Bain Capital
8.CVC Capital Partners
9.First Reserve Corporation
10.Hellman & Friedman
Ordinary (NRO) funds
Investing in domestic (NRO) is one of the best investment alternatives for
NRIs who wish to deposit their income accrued abroad and maintain it in
Indian rupees. The deposited amount along with the interest is completely
repatriable. Investment can be done in Indian financial institutions including
the Non Banking Finance Companies which are listed with RBI. The interest
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returns accrued on in this account is entitled under IT Act and is subject to
30% tax reduction at source including the appropriate surcharge and education
cess. The NRI investor can repatriate upto USD 1 million every year, for
genuine reasons, by forfeiting valid tariffs.
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National Priority
Development Goals 2015 Vision
Achieve universal primary education
Reduce child mortality
Improve maternal health
Combat HIV/AIDS, Malaria and other diseases
Ensure environmental sustainability
Develop a global patnership for development
Eliminate gender disparities in primary and secondary education, preferably
by 2005, and in all levels of education by 2015
Halve the proportion of the people suffering from Hunger
International organization participation
ABEDA, ADB, AfDB (nonregional member), ARF, ASEAN (dialogue partner),
BIMSTEC, BIS, BRICS, C, CD, CERN (observer), CICA, CP, EAS, FAO,
FATF, G-15, G-20, G-24, G-77, IAEA, IBRD, ICAO, ICC, ICRM, IDA, IFAD,
IFC, IFRCS, IHO, ILO, IMF, IMO, IMSO, Interpol, IOC, IOM, IPU, ISO, ITSO,
ITU, ITUC, LAS (observer), MIGA, MONUSCO, NAM, OAS (observer),
OECD, OPCW, PCA, PIF (partner), SAARC, SACEP, SCO (observer), UN,
UNCTAD, UNDOF, UNESCO, UNHCR, UNIDO, UNIFIL, UNISFA,
UNITAR, UNMISS, UNMIT, UNOCI, UNSC (temporary), UNWTO, UPU,
WCO, WFTU, WHO, WIPO, WMO, WTO
India Potential
Developing a basic understanding or potential of the Indian market The Indian middle class is large and growing; wages are low; many workers are well educated and speak English; investors are optimistic and local stocks are up; despite political turmoil, the country presses on with economic reforms.But there is still cause for worries-
Infrastructural hassles The rapid economic growth of the last few years has put heavy stress on India's infrastructural facilities. The projections of further expansion in key areas could snap the already strained lines of transportation unless massive programs of expansion and modernization are put in place. Problems include power demand shortfall, port traffic capacity mismatch, poor road conditions (only half of the country's roads are surfaced), low telephone penetration (1.4% of population).
Indian Bureaucracy Although the Indian government is well aware of the need for reform and is pushing ahead in this area, business still has to deal with an inefficient and sometimes still slow-moving bureaucracy.
Diverse Market The Indian market is widely diverse. The country has 17 official languages, 6 major religions, and ethnic diversity as wide as all of Europe. Thus, tastes and preferences differ greatly among sections of consumers. Therefore, it is advisable to develop a good understanding of the Indian market and overall economy before taking the plunge. Research firms in India can provide the information to determine how, when and where to enter the market. There are also companies which can guide the foreign firm through the entry process from beginning to end --performing the requisite research, assisting with configuration of the project, helping develop Indian partners and financing, finding the land or ready premises, and pushing through the paperwork required.
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Trade Opportunities
1. Indian Business Environment and Climate. India is traditionally a mixed economy. Many of the important sectors especially in the infrastructure and Industrial Sectors were in the hands of the government and other sectors were in the hands of private sector. But with the liberalization of the economy since 1991.India has really understood the importance of the global players and the relevant growth affects on the local suppliers and customers of India. The government previously had a considerable control over the private sector through licensing for additional manufacturing, Import of capital goods, Raw material and technology but with after liberalization & considerable chages and government has rationalised the norms for many licensing activities and even abolished completely in certain cases. These economic reforms have changed the business environment in India and a new economic freedom is in the process of bringing the change. Regular economic reforms are aimed to de regulate the country and stimulate the foreign Investment. So the overall environment is improving but it need to be speeding up in order to attract more foreign investment and high growth rate. "Business environment in India is improving and will be beneficial for the foreign investors"
2. Political Stability India is the largest democracy. It has really been long journey for the Indian politics and it has changed a lot as compared to the initial years. India has not seen any single party government since 1989. which indicates that the politically it is not stable but over the past twenty years the transformation of Indian politics from a stable single party government to a stable collation government has given some confidence to the international market as the last two governments were collation governments but have completed their full term. Further in the near terms it seems difficult to have a single party government. Even after having the collation government the main political parties in these governments were successful in taking the economic reforms ahead. India has set itself as an example to form and successfully complete terms of collation governments and equally doing impressive economic reforms in the past decade.
3. Availability of Buyers The most important factor for a successful market is that it should have the buyers who are willing to purchase. This plays a most important role in making India a very attractive market. India have huge and varied customer base which is the second largest population base in the world. The availability of all types of religion,cast and creed and the diversified culture makes it a more complicated market and hard to understand behaviors of buyer. But as far as huge population is concerned we can be sure that the potential exists for the various types of consumer goods therefore many foreign countries have been successful so far in establishing them self in India. In the presence of the huge population it gives scope to all other sectors also such as education , medical , agriculture and various other industries. Further as India is one of the fastest growing economy it also give
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scope for various other heavy industries such as shipping, bulk Machinery, refineries, infrastructure and real estate etc. Hence with an increasing education level and economic development India promises to be a great source of buyer for all types of industry and attraction for the foreign investors.
4. Regulatory framework In order to develop a market and maximize its reach the market should be well regulated, In India the markets are generally regulated by the demand and supply of the goods, but at the same time government is regularly involved in the regulating the market and take efforts that the market is not suffered. For the foreign investor there are many regulation involved which makes some hurdle for the investors to invest in India but the government is regularly reviewing them and as per the market requirement they are being amended and proper care is taken for the domestic market also so that the local business community is not effected. Regulatory framework in India is very complicated and time consuming and the foreign investors are generally not satisfied with the various registrations and formalities involved in setting up the business. As the investment generally comes from the developed nations where the regulatory framework is simple and strong hence the investors feel that the regulatory framework need a lot of improvement. The various laws and regulations involved for industries to be setup in India further it takes a long time to get the approval from government organizations. For each registration one has to contact different departments. Further not only registration but the company has to comply regularly comply with the various other monthly , quarterly and annual filling with various government departments. The above regulation and filling make the regulatory frame work more complicated. But the government is regularly working towards improvement of this framework which will help to boost the confidence of investor. Following are some of the recent improvement done by the government. * Online registration of companies. * Online payment of taxes * Online filling of tax return. * Online filling of Income Tax Return. * Online payment of services tax. * Online filling of sales tax returns. Hence the government is working towards the improvement of the framework and the in future we can expect the same to be streamlined.
5. Infrastructure Developments. In the development process of a country the most important factor is to have strong infrastructure development. Infrastructure includes the development of the Airport, Railway, power, ports, bridges, Highways and dams etc. India has always been on the weak side in respect of the infrastructure development process. But in the past one decade great efforts are being taken in development of these infrastructures and there was boom in the infrastructure and real estate sector.
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There are many projects still going in the infrastructure sector which will change the face of the India infrastructure sector. The still lacking point is the slow execution of projects. But looking at the current reforms and the development process it looks that India will be very sound in relation to the infrastructure availability.
Main Industry textiles, chemicals, food processing, steel, transportation equipment, cement, mining, petroleum, machinery, software, pharmaceuticals
Biggest Company
Industry Type Name of the company
Oil & Gas Operation Reliance Industries Ltd
Oil & Natural Gas Coop
Indian Oil
Capital Good
Tata Motor
Sterlite Industries
Bajaj Auto
Materials Steel Authority of India
Tata Steel
Hindalco Industries
Foot Drink & Tobacco ITC
Utilities National Thermal Power
Gail (India)
Telecomunication Bharti Airtel
Trading Company MMTC Adani Export
Household & Personal Product Hindustan Lever Limited
Construction Grasim Industries
Business Service & Supplier Wipro
Infosys Technologies
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