Mr Ankit Pradhan speaks on how India handled the pandemic and the impacts on India after the COVID-19 lockdown ends. He discusses how India will emerge winner after this COVID-19 chaos.
It can be said that the global economy has already entered into a great recession. Superpowers like Italy or America or France or Germany is already the worst affected. A lot many industries such as Travel and Tourism, Hospitality, F&B, Entertainment, Automobile, White Goods, IT, Retail are suffering huge losses, and there is no visible ray of hope any sooner.
In comparison to the developed nations around the world, India has dealt with pandemic very well. The containment of COVID-19 to the current levels is noteworthy.
For foreign investors, India could be the top bet as it already has plans to have more open trade and investment policy. Besides, India is also considered to share values and interest that align closely with the western democracies.
Pre-COVID amidst the global financial crisis, companies like Apple, Nintendo, HP, Dell were already planning to move as rapid wage growth in china outplaced labour productivity growth.
“Not only can India boast of having highly skilled labour, impressive entrepreneurial talent, a large internal consumer market and thriving private enterprises, but India’s analytic, financial, technical, and management services are also world-class”, says Mr Ankit Pradhan, Founder and CEO, Realtyassistant.
Developed nations like Japan has announced setting up of a $2.2-billion fund, to help its manufacturers for shifting of their production out of China as the coronavirus disrupted supply chains between the major trading partners. Other developed countries are also likely to urge their investors to follow a similar strategy.
American and Europian economies have taken a significant hit, and now the foreign investors have to look for destinations with comparatively low operation and production costs and a local supply chain in place. Furthermore, businesses want to de-risk in having supply chain concentrated in one area and try to diversify and disperse.
Mr Ankit Pradhan, Founder and CEO, Realtyassistant further adds, “India is among the top FDI destinations in the world; it is evident from the fact that last year India received half of the total of previous twenty years of FDI investment.”
India did receive a sum of $64.37 billion of FDI in 2018-19, which is a 6 per cent jump over the2017-18, at a time when global FDI flow was declining. UNCTAD, India compiled the Global Investment Trend Monitor report which shows India among the top 10 recipients of FDI in the year 2019, resulting in attracting $49 billion in inflows, a 16 per cent increase from the previous year.
Meanwhile, India is emerging as a reliable alternative to China for foreign companies invested in manufacturing and sourcing. India has to work on positioning itself as a global services hub in sectors like Pharmaceuticals and the integration of India in the worldwide supply chain is to be seen.
‘Invest India’ has joined hands with the Top global consultancy firms like Bain & Co, EY, PwC, BCG, KPMG, Primus Partners, and Mirae Asset Management to make out an economic revival strategy. Our country can meet this requirement as incentives allow fast-tracking of manufacturing, especially in special economic zones (SEZs) and free trade zones.
India has allocated about US$6 billion to boost domestic manufacturing and to attract investment and incentivise electronics and components manufacturing and exports in the country. This move was announced as a part of India’s ambition to become a US$1 trillion economy by 2025.
The official trade and investment regulator of the country, the Department of Promotion for Industry and Internal Trade (DPIIT) notified changes to India’s foreign direct investment (FDI) policy.
The above step was taken in turn to restrict any wrong buying of Indian businesses by the Chinese companies or state-run institutions. These changes now make government clearance mandatory – for all FDI inflows from countries that share land borders with India.
Lately, UP Chief Minister, Yogi Adityanath has also promised tailor-made facilities to giants like FedEx, Cisco and Adobe for moving facility to Uttar Pradesh.
The FDI policy is already tightened to prevent any opportunistic takeovers or acquisition of Indian companies due to the COVID-19 pandemic. Hence, India has an opportunity to become a sustainable, resilient and diverse economy. It looks like India is all set to emerge as a post-COVID winner.