Foreign Investors Continue to Pour Money into India

By admin • May 20th, 2010

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India’s economy continues to prove itself as attractive location for foreign investment due to steady growth rates, long-term potential and key attributes for growth. With the economy growing at an impressive rate of 8.5%, and an expected growth of 9% next year, there is constant potential and opportunities for foreign companies in India.

Foreign corporations are especially interested by surging demand, availability of labour, the vast middle-class sector and a demographic outlook superior to China. India also has a key area which investors always look for when exploring new economies – a large young workforce. Around 31% of India’s population is under 15%.

A variety of companies are setting up in India due to the control they have over their companies market entry and operations compared to other economies and firms won’t have to set up new sectors to bring in revenue.

Two industries in particular benefiting from the growing economy are the mobile phone industry which is increase at a staggering rate of 16 million users a month. The motor industry in April saw an increase of 40% on a year-on-year basis for car sales which has attracted companies such as Toyota Motor Corp. German car makers Volkswagen are also tapping into this huge potential and are expected to invest around $5 billion in India.

FDI for the fiscal year end in March was $33 billion, whilst overseas portfolio investors invested almost $24 billion for the same period. Both of these figures are the highest ever high for the period and again emphasise India’s growing potential.

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