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India ready for investment turnaround
BusinessLine· 2025-09-25 01:00
Group 1: Economic Resilience and Investment Climate - Global rating agencies have reaffirmed their faith in India's structural resilience, indicating a positive outlook for the Indian sovereign despite trade challenges [1] - India has attracted over $1 trillion in FDI since 2000, with sectors like services, technology, and telecom being the primary beneficiaries, and Q1 FY26 YTD figures nearing $25 billion [3] - The introduction of SWAGAT-FI by SEBI and changes in FEMA guidelines by RBI are expected to simplify access for foreign investors and enhance the use of the rupee in international trade [4] Group 2: Policy Measures and Economic Growth - A series of policy measures have been implemented, including PMAY (3.2 crore houses sanctioned), MUDRA (₹33.65 lakh crore sanctioned to over 52 crore accounts), and UDYAM (over 6.86 crore MSMEs registered), which have collectively transformed structural stagnation [5] - Since 2021, GST collection has increased by 94%, corporate tax collection by 116%, and income tax collection by 143%, indicating significant growth in the tax base and corporate profits [7] Group 3: Corporate Formalization and Innovation - In FY24, over 185,000 companies were formed in India, with around 18.5 lakh active companies currently, while efforts to combat money laundering have led to the removal of 8.5 lakh inactive companies [8] - India has made significant strides in innovation, with growth in copyrights, patents, and trademarks, positioning itself competitively against developed economies [9] Group 4: Start-up Ecosystem and Capital Markets - Indian start-ups have thrived due to government support, including the Fund of Funds for Startups, countering challenges from the global funding environment [10] - The capital markets have facilitated numerous public offerings, with 764 public issuances since 2014-15, enhancing the ease of exit for investors and supporting younger firms [11] Group 5: Global Integration and Infrastructure Development - India's potential inclusion in global bond indices will require significant recalibration of its debt market and funding for multi-modal infrastructure projects [12]