ec7fa8a17afb4ed09668ca3cba134dcd India enters a technical recession. What is it and what does it mean for the Indian economy?

 Indian Economy 2020

Economy of India (Republic of India), main economic indicators, infographics, economic sectors, trade (data and regulations), investments, (risk and benefits) relations with Italy, sources, websites and books on the net .  The Indian economy  represents a market with significant potential, perhaps unique on a global level, due to the breadth of the margins it offers, even in the presence of important complexities. The growth rate of the Indian economy remains among the fastest on a global scale.  The following report on the Indian economy  is edited by  Corriere Asia  and produced in collaboration with RsA Asia . economy India infographic India economy indicators and infographics Gross Domestic Product: 2.264 Billion Dollars (USD) Economic growth rate: +7.1% Inflation: 4.5% Unemployment: 3.46% Total population: 1,335,250,000 Working Population: 520,199,005 Taxation: Companies 30% - Individuals from 0% to 30% Foreign Debt: 456,140,000,000 Dollars (USD) Internal debt: 69.5% of GDP India economy analysis Despite the slowdown of the last two years, the country has gone through a phase of accelerated growth, to become, according to data from the International Monetary Fund, the tenth world economy in nominal terms. From an internal point of view, this growth also guarantees a constant annual increase in GDP per capita at current prices, affecting benefits on several social levels. The forecasts for the future are optimistic: the government of New Delhi has set itself the goal of raising, by 2025, the contribution of the manufacturing sector to GDP from the current 15% to 25%, while creating around 100 million jobs work. In recent years, the government has also launched a series of industrial plans, mainly aimed at bridging the country's energy and infrastructure deficit. According to the most recent estimates released in April by the International Monetary Fund (IMF), contained in the World Economic Outlook (WEO), India's growth should accelerate to 7.7% by 2018, reaching above 8% in the following five years. . Economic sectors India Availability of raw materials The mining and quarrying sector contributes 2.5% of India's GDP (Central Statistical Organization). According to data from the Ministry of Mines, India produces 87 types of minerals (including 4 fossil fuels, 10 ferrous, 47 non-ferrous, 3 nuclear and 23 minor minerals). In India, 80% of extraction is for coal production and the remaining 20% ​​is for other minerals and natural resources such as gold, copper, iron, lead, bauxite, zinc and uranium. Also according to the statistics of the Ministry of Mines, the total value of mining production (excluding nuclear minerals) in the fiscal year 2010-11 was estimated at US $ 41.79 billion. India also has availability of rare earths with reserves estimated at 3.1 million tons, or approximately 3% of world reserves, of which India is increasing its extraction capacities. A great investment opportunity for foreign companies is precisely the extraction, in fact in India there are no limits to foreign investments (admitted 100% with automatic approval) for the extraction and exploration of ferrous and non-ferrous raw minerals, including diamonds, gold, silver and precious stones, however, minerals containing titanium are excluded. In addition, investments in coal and lignite mining are also allowed 100% with automatic authorization with the obligation to use them for consumption in energy production projects, production of iron and steel, cement and other activities envisaged in the Coal Mines. Furthermore, in 2011 the Indian government approved a new regulation "New Mines and Minerals (Development and Regulation) Bill, 2011" with the aim of initiating a complete reform in the mining sector, taking into consideration factors such as the sustainability of mining practices, the local development and the impact of mining operations on the social order. Motor vehicles, trailers and semi - trailers i Foreign investment in the automotive sector is allowed in India up to 100% and has been close to or above $ 1 billion in each of the last 4 fiscal years. The still relatively high tariffs, combined with low labor costs, are the basis of the huge production investments in India by all the world's car manufacturers. In recent years, all major foreign groups (Toyota, Ford, General Motors, Nissan-Renault, Volkswagen, Honda, Hyundai and Fiat) have initiated significant expansions of their production capacity in India, particularly in the small car segments, which they account for almost three quarters of domestic demand. According to a recent study by Ernst & Young, production will grow at a rapid pace until 2020 in all segments: passenger vehicles, commercial vehicles, two and three wheels, tractors. The auto components sector - booming to the point that it is estimated that it will triple by 2020, reaching a value of approximately 3.5% of national GDP by 2020 - is characterized by lively competition between companies that are increasingly aware of importance of the "quality" aspect. A large production base with low cost and high specialization has attracted numerous foreign partners in this sector, but the national production is also well developed, with numerous companies able to supply products of certified standards. Buildings India is making a massive effort to upgrade its infrastructures: in the five-year period 2012 - 2017 (12th five-year plan) the Indian government announced investments of 750 billion euros. The Government aims to involve the private sector as much as possible, including foreign investors, in the great work of modernizing infrastructures (highways, railways, ports and airports) according to the formula of Private-Public Partnerships and with BOT (Build - Operate - Transfer). The planned works include: Roads and highways, ports, railways and urban development. Electricity, gas, steam and air conditioning The energy sector in India has been the one that, since 2000, has attracted the greatest volumes of foreign direct investments. FDI is allowed up to 100%. Particular attention should be given to wind power: Wind power has developed enormously in India since the 1990s, especially in the production of turbines, attracting international giants, in 2011 the installed capacity in the country was 14,156 MW which makes India the fifth largest producer in the world after the USA, Germany, China and Spain. However, the potential is estimated at around 48GW, which could become 70-100 GW in consideration of recent technological developments. Also in the biomass sector the potential is enormous: the installed capacity does not reach 2 GW, while the potential would be almost 20 GW. In India, on the other hand, there are no geothermal power stations, however more than 300 sources have been identified, equal to an estimated capacity of over 10 GW. In 2010, India ranked eighth in the world for investments in the renewable energy sector, for a value that should exceed $ 15 billion during the eleventh five-year plan (2007-2012). Ernst & Young has elaborated an “attractiveness index” of investments in renewables, on the basis of which India would be awarded the third position overall, after China and the USA. Foodstuffs The Indian agricultural sector is one of the largest in the world in terms of production and consumption: India is the second largest producer of fruit and vegetables in the world and its agricultural production constitutes 8% of that of the world. Agriculture contributes only 16% to India's GDP (while employing over half of India's workforce). In the food processing  sector,  foreign direct investments are 100% admitted with automatic approval. The Indian government is also trying to develop a Food Mega Parks project, special areas characterized by incentives and administrative facilities, to attract foreign investors. The furniture and design sector is particularly promising in India in light of the great development of residential construction and the hospitality segment. Studies on the habits of the Indian consumer, increasingly attentive to international trends, confirm the high potential of the sector. Trade in India - import export Import export Import In 2016, India imported for a total value of 344 billion dollars, placing it in fourteenth place among the world's largest importers. Over the past five years, Indian imports have fallen sharply by 8.912% annualized from US $ 402bn in 2011 to US $ 344bn today. The most recent imports were led by the "Crude Petroleum" sector which represents 17.6% of all the total imported from the country, followed by gold imports which account for 6.65% on the balance. Export In 2016 India exported $ 256 billion worth of products, making it the 18th largest exporting power in the world. Over the last 5 years, exports have had a slight decline of 1.585% annualized from 274 billion in 2011 to 256 billion today. Recently, the sector that drives Indian exports the most is "Refined Petroleum" which represents 9.9% (25.4M USD) of the total exported value, followed by the export of diamonds which equals 9.3% (24M USD) of the total value. Following these two leading sectors are the jewelry sector (12.6M USSD) and the pharmaceutical package (11.6M USD). Foreign investments Foreign investments are approved according to two different procedures: automatic or governmental, according to the methods and sector of investment. In the automated procedure, the non-resident investor or Indian company does not need any approval from the Indian government for the investment. Conversely, in the government procedure the investment is allowed with the approval of the Indian government. Investment proposals that require government procedure are handled by the Foreign Investment Promotion Board (FIPB). For production activities in some sectors it is mandatory to obtain an industrial license. Companies with wholly foreign capital can obtain automatic approval when they operate in high priority sectors (eg production and transmission of electricity); otherwise, a request must be sent to the FIPB, which expresses its opinion on the basis of a series of parameters. Finally, the Indian government gives top priority to small businesses, which contribute significantly to exports and employment levels and has therefore prepared a series of tax breaks. Labor regulations India is a member of the International Labor Organization (ILO) and complies with the conventions it has ratified. There are numerous applicable labor regulations, including the Contract Labor (Regulation & Abolition) Act (1970) which applies to any company in which twenty or more workers are employed or have been employed on any day of the previous twelve months with a fixed-term contract. The interests of contract workers are protected in terms of wages, working hours, social security and health. There are also several older regulations relating to specific aspects of the employment relationship, such as trade union protection (Trade unions act of 1926), the right to a bonus (Payment of bonus act of 1965) or the right to compensation in the event of accidents. or workplace accidents (Workmen's Compensation Act of 1923). Investments in India - risks and benefits The  advantages  of investing in India are: Market size and demand growth: While demand is now stagnant in most economies of historical industrialization, Indian consumption continues to grow, driven by the sensitive dynamism of the "aspiring middle class", which is expanding year by year and the whose average income is constantly increasing (per capita disposable income doubled between 2005 and 2011). This positive trend in consumption is advantageous in the demographic dividend, with almost half of the population (603 million people) below of 25 years of age. Low Cost Labor Availability: The availability of competitively priced labor remains one of the main reasons behind investment in manufacturing in India. Thanks also to a literacy rate of 74%, it is possible to find skilled and English-speaking labor, the main reason why a thriving service outsourcing industry has developed in India. Availability of skilled resources: India has a solid and well established education system, with over 20,000 universities and training institutes, with a focus on scientific disciplines. Every year 2 million engineers graduate in India (while 2.5 million complete postgraduate studies). The number of technical and scientific graduates has doubled over the past 10 years. The availability of human resources trained in science and technology is one of the reasons why many multinationals decide to open their research and development centers here. Availability of raw materials: India is rich in natural resources, especially coal, iron and bauxite. It is the second largest producer of cement in the world, the third of steel and the first of direct reduced iron. It is also one of the largest producers of leather in the world. Indian reserves of rare earths are estimated at 3.1 million tons, or approximately 3% of the world reserves, of which India is increasing its extraction capacities. India also has availability of cotton and a great variety of fabrics, making it a prime destination for the outsourcing of apparel companies. The  risks  of investing in India are: Political risks: The decentralization of powers from the central government to the authorities of the twenty-nine states that make up the Federal Republic of India is a growing phenomenon that goes hand in hand with the strengthening of local parties and makes the implementation of policies by the Central government. Security and terrorism risk: The risk levels in the country remain significant. Over the years there have been frequent internal disorders, including violent ones, which can worsen in the pre-electoral phases and terrorist attacks of various matrices. Infrastructure and freight transport: the inadequacy of the transport network continues to represent a significant cost. This is accompanied by rather long times for customs clearance of goods. Access to credit: the major international rating agencies continue to place India at the lowest level of investment grade status: BBB-, Baa3 and BBB- are the ratings of S & P's, Moody's and Fitch respectively. Energy distribution infrastructures: the necessary restructuring of the electricity transmission and distribution system in the country is proceeding slowly. Shortcomings in supply security, failure to adapt the capacity of electricity production plants and frequent blackouts are among the critical factors that companies that want to invest in the country must take into consideration. Excessive bureaucracy and judicial slowness: a cumbersome and slow bureaucratic system of authorizations and licenses, not unrelated to corruption phenomena, is the corollary of an often complex and not very transparent legislation. Further problematic elements are given by the slowness of justice; companies wishing to invest in India are advised to include international arbitration clauses in their contracts. Italy India reports Among the strategic sectors for the internationalization of Italian companies, there are infrastructures, mechanics and mechatronics, renewable energies, the automotive sector and the agri-food technology sector. In the twenty years from 1991 to 2011, the Italy-India trade has grown 12 times, passing from 708 million euros to 8.5 billion euros. However, starting from 2012 a decreasing trend began, which brought bilateral trade to € 7.2 billion in 2014, however, marking an increase of 3.6% compared to 2013 (source Istat). Italy is India's fourth largest trading partner among EU countries (after Germany, the United Kingdom and Belgium). Overall, Italian exports to India in April 2015 compared to the same month in 2014 grew by 24.9%. Italian exports accumulated in the period January-April 2015, compared to the same period (January-April) of 2014, grew by 12.7% (higher than the average performance to other non-EU countries which was + 12.2% ). Italian imports from India in April 2015 grew by 13.9%; in the period January-April 2015 by + 13% (source ICE New Delhi). Machinery and appliances continue to represent the first item of Italian exports to India, with a share of around 40%; over a quarter of Italian imports from India instead fall into the textile-clothing-leather accessories category. As for the flow of direct investments, in 2012 Italian companies invested over 1 billion euros in India in 2012 (source Eurostat). At the end of 2012, Italy had a cumulative stock of FDI in India of € 3.75 billion. Furnishing products are constantly growing (over 30% in recent years) and Made in Italy products are generally appreciated for the wealth of materials used, high design content, quality and attention to detail. We can certainly speak of a “positive prejudice” towards Italian products in this sector. The luxury car and SUV sector is also starting to grow: brands such as Ferrari, Maserati and Lamborghini have in recent years opened exclusive showrooms in the main cities of the country. A total number of over 400 legal entities and Italian factories in India can be estimated, present in three main forms: wholly owned subsidiaries, Joint Ventures (solution preferred by SMEs and mandatory in sectors with caps on foreign investment) or representative commercial offices

Economy of India (Republic of India), main economic indicators, infographics, economic sectors, trade (data and regulations), investments, (risk and benefits) relations with Italy, sources, websites and books on the net . 

The Indian economy  represents a market with significant potential, perhaps unique on a global level, due to the breadth of the margins it offers, even in the presence of important complexities. The growth rate of the Indian economy remains among the fastest on a global scale. 

The following report on the Indian economy  is edited by  Corriere Asia  and produced in collaboration with RsA Asia .



  • economy India infographic

  • India economy indicators and infographics

  • Gross Domestic Product: 2.264 Billion Dollars (USD)

  • Economic growth rate: +7.1%

  • Inflation: 4.5%

  • Unemployment: 3.46%

  • Total population: 1,335,250,000

  • Working Population: 520,199,005

  • Taxation: Companies 30% - Individuals from 0% to 30%
  • Foreign Debt: 456,140,000,000 Dollars (USD)
  • Internal debt: 69.5% of GDP

Economy of India (Republic of India), main economic indicators, infographics, economic sectors, trade (data and regulations), investments, (risk and benefits) relations with Italy, sources, websites and books on the net .  The Indian economy  represents a market with significant potential, perhaps unique on a global level, due to the breadth of the margins it offers, even in the presence of important complexities. The growth rate of the Indian economy remains among the fastest on a global scale.  The following report on the Indian economy  is edited by  Corriere Asia  and produced in collaboration with RsA Asia . economy India infographic India economy indicators and infographics Gross Domestic Product: 2.264 Billion Dollars (USD) Economic growth rate: +7.1% Inflation: 4.5% Unemployment: 3.46% Total population: 1,335,250,000 Working Population: 520,199,005 Taxation: Companies 30% - Individuals from 0% to 30% Foreign Debt: 456,140,000,000 Dollars (USD) Internal debt: 69.5% of GDP India economy analysis Despite the slowdown of the last two years, the country has gone through a phase of accelerated growth, to become, according to data from the International Monetary Fund, the tenth world economy in nominal terms. From an internal point of view, this growth also guarantees a constant annual increase in GDP per capita at current prices, affecting benefits on several social levels. The forecasts for the future are optimistic: the government of New Delhi has set itself the goal of raising, by 2025, the contribution of the manufacturing sector to GDP from the current 15% to 25%, while creating around 100 million jobs work. In recent years, the government has also launched a series of industrial plans, mainly aimed at bridging the country's energy and infrastructure deficit. According to the most recent estimates released in April by the International Monetary Fund (IMF), contained in the World Economic Outlook (WEO), India's growth should accelerate to 7.7% by 2018, reaching above 8% in the following five years. . Economic sectors India Availability of raw materials The mining and quarrying sector contributes 2.5% of India's GDP (Central Statistical Organization). According to data from the Ministry of Mines, India produces 87 types of minerals (including 4 fossil fuels, 10 ferrous, 47 non-ferrous, 3 nuclear and 23 minor minerals). In India, 80% of extraction is for coal production and the remaining 20% ​​is for other minerals and natural resources such as gold, copper, iron, lead, bauxite, zinc and uranium. Also according to the statistics of the Ministry of Mines, the total value of mining production (excluding nuclear minerals) in the fiscal year 2010-11 was estimated at US $ 41.79 billion. India also has availability of rare earths with reserves estimated at 3.1 million tons, or approximately 3% of world reserves, of which India is increasing its extraction capacities. A great investment opportunity for foreign companies is precisely the extraction, in fact in India there are no limits to foreign investments (admitted 100% with automatic approval) for the extraction and exploration of ferrous and non-ferrous raw minerals, including diamonds, gold, silver and precious stones, however, minerals containing titanium are excluded. In addition, investments in coal and lignite mining are also allowed 100% with automatic authorization with the obligation to use them for consumption in energy production projects, production of iron and steel, cement and other activities envisaged in the Coal Mines. Furthermore, in 2011 the Indian government approved a new regulation "New Mines and Minerals (Development and Regulation) Bill, 2011" with the aim of initiating a complete reform in the mining sector, taking into consideration factors such as the sustainability of mining practices, the local development and the impact of mining operations on the social order. Motor vehicles, trailers and semi - trailers i Foreign investment in the automotive sector is allowed in India up to 100% and has been close to or above $ 1 billion in each of the last 4 fiscal years. The still relatively high tariffs, combined with low labor costs, are the basis of the huge production investments in India by all the world's car manufacturers. In recent years, all major foreign groups (Toyota, Ford, General Motors, Nissan-Renault, Volkswagen, Honda, Hyundai and Fiat) have initiated significant expansions of their production capacity in India, particularly in the small car segments, which they account for almost three quarters of domestic demand. According to a recent study by Ernst & Young, production will grow at a rapid pace until 2020 in all segments: passenger vehicles, commercial vehicles, two and three wheels, tractors. The auto components sector - booming to the point that it is estimated that it will triple by 2020, reaching a value of approximately 3.5% of national GDP by 2020 - is characterized by lively competition between companies that are increasingly aware of importance of the "quality" aspect. A large production base with low cost and high specialization has attracted numerous foreign partners in this sector, but the national production is also well developed, with numerous companies able to supply products of certified standards. Buildings India is making a massive effort to upgrade its infrastructures: in the five-year period 2012 - 2017 (12th five-year plan) the Indian government announced investments of 750 billion euros. The Government aims to involve the private sector as much as possible, including foreign investors, in the great work of modernizing infrastructures (highways, railways, ports and airports) according to the formula of Private-Public Partnerships and with BOT (Build - Operate - Transfer). The planned works include: Roads and highways, ports, railways and urban development. Electricity, gas, steam and air conditioning The energy sector in India has been the one that, since 2000, has attracted the greatest volumes of foreign direct investments. FDI is allowed up to 100%. Particular attention should be given to wind power: Wind power has developed enormously in India since the 1990s, especially in the production of turbines, attracting international giants, in 2011 the installed capacity in the country was 14,156 MW which makes India the fifth largest producer in the world after the USA, Germany, China and Spain. However, the potential is estimated at around 48GW, which could become 70-100 GW in consideration of recent technological developments. Also in the biomass sector the potential is enormous: the installed capacity does not reach 2 GW, while the potential would be almost 20 GW. In India, on the other hand, there are no geothermal power stations, however more than 300 sources have been identified, equal to an estimated capacity of over 10 GW. In 2010, India ranked eighth in the world for investments in the renewable energy sector, for a value that should exceed $ 15 billion during the eleventh five-year plan (2007-2012). Ernst & Young has elaborated an “attractiveness index” of investments in renewables, on the basis of which India would be awarded the third position overall, after China and the USA. Foodstuffs The Indian agricultural sector is one of the largest in the world in terms of production and consumption: India is the second largest producer of fruit and vegetables in the world and its agricultural production constitutes 8% of that of the world. Agriculture contributes only 16% to India's GDP (while employing over half of India's workforce). In the food processing  sector,  foreign direct investments are 100% admitted with automatic approval. The Indian government is also trying to develop a Food Mega Parks project, special areas characterized by incentives and administrative facilities, to attract foreign investors. The furniture and design sector is particularly promising in India in light of the great development of residential construction and the hospitality segment. Studies on the habits of the Indian consumer, increasingly attentive to international trends, confirm the high potential of the sector. Trade in India - import export Import export Import In 2016, India imported for a total value of 344 billion dollars, placing it in fourteenth place among the world's largest importers. Over the past five years, Indian imports have fallen sharply by 8.912% annualized from US $ 402bn in 2011 to US $ 344bn today. The most recent imports were led by the "Crude Petroleum" sector which represents 17.6% of all the total imported from the country, followed by gold imports which account for 6.65% on the balance. Export In 2016 India exported $ 256 billion worth of products, making it the 18th largest exporting power in the world. Over the last 5 years, exports have had a slight decline of 1.585% annualized from 274 billion in 2011 to 256 billion today. Recently, the sector that drives Indian exports the most is "Refined Petroleum" which represents 9.9% (25.4M USD) of the total exported value, followed by the export of diamonds which equals 9.3% (24M USD) of the total value. Following these two leading sectors are the jewelry sector (12.6M USSD) and the pharmaceutical package (11.6M USD). Foreign investments Foreign investments are approved according to two different procedures: automatic or governmental, according to the methods and sector of investment. In the automated procedure, the non-resident investor or Indian company does not need any approval from the Indian government for the investment. Conversely, in the government procedure the investment is allowed with the approval of the Indian government. Investment proposals that require government procedure are handled by the Foreign Investment Promotion Board (FIPB). For production activities in some sectors it is mandatory to obtain an industrial license. Companies with wholly foreign capital can obtain automatic approval when they operate in high priority sectors (eg production and transmission of electricity); otherwise, a request must be sent to the FIPB, which expresses its opinion on the basis of a series of parameters. Finally, the Indian government gives top priority to small businesses, which contribute significantly to exports and employment levels and has therefore prepared a series of tax breaks. Labor regulations India is a member of the International Labor Organization (ILO) and complies with the conventions it has ratified. There are numerous applicable labor regulations, including the Contract Labor (Regulation & Abolition) Act (1970) which applies to any company in which twenty or more workers are employed or have been employed on any day of the previous twelve months with a fixed-term contract. The interests of contract workers are protected in terms of wages, working hours, social security and health. There are also several older regulations relating to specific aspects of the employment relationship, such as trade union protection (Trade unions act of 1926), the right to a bonus (Payment of bonus act of 1965) or the right to compensation in the event of accidents. or workplace accidents (Workmen's Compensation Act of 1923). Investments in India - risks and benefits The  advantages  of investing in India are: Market size and demand growth: While demand is now stagnant in most economies of historical industrialization, Indian consumption continues to grow, driven by the sensitive dynamism of the "aspiring middle class", which is expanding year by year and the whose average income is constantly increasing (per capita disposable income doubled between 2005 and 2011). This positive trend in consumption is advantageous in the demographic dividend, with almost half of the population (603 million people) below of 25 years of age. Low Cost Labor Availability: The availability of competitively priced labor remains one of the main reasons behind investment in manufacturing in India. Thanks also to a literacy rate of 74%, it is possible to find skilled and English-speaking labor, the main reason why a thriving service outsourcing industry has developed in India. Availability of skilled resources: India has a solid and well established education system, with over 20,000 universities and training institutes, with a focus on scientific disciplines. Every year 2 million engineers graduate in India (while 2.5 million complete postgraduate studies). The number of technical and scientific graduates has doubled over the past 10 years. The availability of human resources trained in science and technology is one of the reasons why many multinationals decide to open their research and development centers here. Availability of raw materials: India is rich in natural resources, especially coal, iron and bauxite. It is the second largest producer of cement in the world, the third of steel and the first of direct reduced iron. It is also one of the largest producers of leather in the world. Indian reserves of rare earths are estimated at 3.1 million tons, or approximately 3% of the world reserves, of which India is increasing its extraction capacities. India also has availability of cotton and a great variety of fabrics, making it a prime destination for the outsourcing of apparel companies. The  risks  of investing in India are: Political risks: The decentralization of powers from the central government to the authorities of the twenty-nine states that make up the Federal Republic of India is a growing phenomenon that goes hand in hand with the strengthening of local parties and makes the implementation of policies by the Central government. Security and terrorism risk: The risk levels in the country remain significant. Over the years there have been frequent internal disorders, including violent ones, which can worsen in the pre-electoral phases and terrorist attacks of various matrices. Infrastructure and freight transport: the inadequacy of the transport network continues to represent a significant cost. This is accompanied by rather long times for customs clearance of goods. Access to credit: the major international rating agencies continue to place India at the lowest level of investment grade status: BBB-, Baa3 and BBB- are the ratings of S & P's, Moody's and Fitch respectively. Energy distribution infrastructures: the necessary restructuring of the electricity transmission and distribution system in the country is proceeding slowly. Shortcomings in supply security, failure to adapt the capacity of electricity production plants and frequent blackouts are among the critical factors that companies that want to invest in the country must take into consideration. Excessive bureaucracy and judicial slowness: a cumbersome and slow bureaucratic system of authorizations and licenses, not unrelated to corruption phenomena, is the corollary of an often complex and not very transparent legislation. Further problematic elements are given by the slowness of justice; companies wishing to invest in India are advised to include international arbitration clauses in their contracts. Italy India reports Among the strategic sectors for the internationalization of Italian companies, there are infrastructures, mechanics and mechatronics, renewable energies, the automotive sector and the agri-food technology sector. In the twenty years from 1991 to 2011, the Italy-India trade has grown 12 times, passing from 708 million euros to 8.5 billion euros. However, starting from 2012 a decreasing trend began, which brought bilateral trade to € 7.2 billion in 2014, however, marking an increase of 3.6% compared to 2013 (source Istat). Italy is India's fourth largest trading partner among EU countries (after Germany, the United Kingdom and Belgium). Overall, Italian exports to India in April 2015 compared to the same month in 2014 grew by 24.9%. Italian exports accumulated in the period January-April 2015, compared to the same period (January-April) of 2014, grew by 12.7% (higher than the average performance to other non-EU countries which was + 12.2% ). Italian imports from India in April 2015 grew by 13.9%; in the period January-April 2015 by + 13% (source ICE New Delhi). Machinery and appliances continue to represent the first item of Italian exports to India, with a share of around 40%; over a quarter of Italian imports from India instead fall into the textile-clothing-leather accessories category. As for the flow of direct investments, in 2012 Italian companies invested over 1 billion euros in India in 2012 (source Eurostat). At the end of 2012, Italy had a cumulative stock of FDI in India of € 3.75 billion. Furnishing products are constantly growing (over 30% in recent years) and Made in Italy products are generally appreciated for the wealth of materials used, high design content, quality and attention to detail. We can certainly speak of a “positive prejudice” towards Italian products in this sector. The luxury car and SUV sector is also starting to grow: brands such as Ferrari, Maserati and Lamborghini have in recent years opened exclusive showrooms in the main cities of the country. A total number of over 400 legal entities and Italian factories in India can be estimated, present in three main forms: wholly owned subsidiaries, Joint Ventures (solution preferred by SMEs and mandatory in sectors with caps on foreign investment) or representative commercial offices


India economy analysis


Despite the slowdown of the last two years, the country has gone through a phase of accelerated growth, to become, according to data from the International Monetary Fund, the tenth world economy in nominal terms.

From an internal point of view, this growth also guarantees a constant annual increase in GDP per capita at current prices, affecting benefits on several social levels.

The forecasts for the future are optimistic: the government of New Delhi has set itself the goal of raising, by 2025, the contribution of the manufacturing sector to GDP from the current 15% to 25%, while creating around 100 million jobs work. In recent years, the government has also launched a series of industrial plans, mainly aimed at bridging the country's energy and infrastructure deficit.

According to the most recent estimates released in April by the International Monetary Fund (IMF), contained in the World Economic Outlook (WEO), India's growth should accelerate to 7.7% by 2018, reaching above 8% in the following five years. .

Economic sectors India


Availability of raw materials


The mining and quarrying sector contributes 2.5% of India's GDP (Central Statistical Organization). According to data from the Ministry of Mines, India produces 87 types of minerals (including 4 fossil fuels, 10 ferrous, 47 non-ferrous, 3 nuclear and 23 minor minerals).

In India, 80% of extraction is for coal production and the remaining 20% ​​is for other minerals and natural resources such as gold, copper, iron, lead, bauxite, zinc and uranium. Also according to the statistics of the Ministry of Mines, the total value of mining production (excluding nuclear minerals) in the fiscal year 2010-11 was estimated at US $ 41.79 billion.

India also has availability of rare earths with reserves estimated at 3.1 million tons, or approximately 3% of world reserves, of which India is increasing its extraction capacities.

A great investment opportunity for foreign companies is precisely the extraction, in fact in India there are no limits to foreign investments (admitted 100% with automatic approval) for the extraction and exploration of ferrous and non-ferrous raw minerals, including diamonds, gold, silver and precious stones, however, minerals containing titanium are excluded. In addition, investments in coal and lignite mining are also allowed 100% with automatic authorization with the obligation to use them for consumption in energy production projects, production of iron and steel, cement and other activities envisaged in the Coal Mines.

Furthermore, in 2011 the Indian government approved a new regulation "New Mines and Minerals (Development and Regulation) Bill, 2011" with the aim of initiating a complete reform in the mining sector, taking into consideration factors such as the sustainability of mining practices, the local development and the impact of mining operations on the social order.

Motor vehicles, trailers and semi - trailers i


Foreign investment in the automotive sector is allowed in India up to 100% and has been close to or above $ 1 billion in each of the last 4 fiscal years. The still relatively high tariffs, combined with low labor costs, are the basis of the huge production investments in India by all the world's car manufacturers. In recent years, all major foreign groups (Toyota, Ford, General Motors, Nissan-Renault, Volkswagen, Honda, Hyundai and Fiat) have initiated significant expansions of their production capacity in India, particularly in the small car segments, which they account for almost three quarters of domestic demand.

According to a recent study by Ernst & Young, production will grow at a rapid pace until 2020 in all segments: passenger vehicles, commercial vehicles, two and three wheels, tractors.

The auto components sector - booming to the point that it is estimated that it will triple by 2020, reaching a value of approximately 3.5% of national GDP by 2020 - is characterized by lively competition between companies that are increasingly aware of importance of the "quality" aspect. A large production base with low cost and high specialization has attracted numerous foreign partners in this sector, but the national production is also well developed, with numerous companies able to supply products of certified standards.

Buildings


India is making a massive effort to upgrade its infrastructures: in the five-year period 2012 - 2017 (12th five-year plan) the Indian government announced investments of 750 billion euros. The Government aims to involve the private sector as much as possible, including foreign investors, in the great work of modernizing infrastructures (highways, railways, ports and airports) according to the formula of Private-Public Partnerships and with BOT (Build - Operate - Transfer).

The planned works include: Roads and highways, ports, railways and urban development.

Electricity, gas, steam and air conditioning


The energy sector in India has been the one that, since 2000, has attracted the greatest volumes of foreign direct investments. FDI is allowed up to 100%.

Particular attention should be given to wind power: Wind power has developed enormously in India since the 1990s, especially in the production of turbines, attracting international giants, in 2011 the installed capacity in the country was 14,156 MW which makes India the fifth largest producer in the world after the USA, Germany, China and Spain. However, the potential is estimated at around 48GW, which could become 70-100 GW in consideration of recent technological developments.

Also in the biomass sector the potential is enormous: the installed capacity does not reach 2 GW, while the potential would be almost 20 GW. In India, on the other hand, there are no geothermal power stations, however more than 300 sources have been identified, equal to an estimated capacity of over 10 GW.

In 2010, India ranked eighth in the world for investments in the renewable energy sector, for a value that should exceed $ 15 billion during the eleventh five-year plan (2007-2012). Ernst & Young has elaborated an “attractiveness index” of investments in renewables, on the basis of which India would be awarded the third position overall, after China and the USA.

Foodstuffs


The Indian agricultural sector is one of the largest in the world in terms of production and consumption: India is the second largest producer of fruit and vegetables in the world and its agricultural production constitutes 8% of that of the world. Agriculture contributes only 16% to India's GDP (while employing over half of India's workforce).

In the food processing  sector,  foreign direct investments are 100% admitted with automatic approval. The Indian government is also trying to develop a Food Mega Parks project, special areas characterized by incentives and administrative facilities, to attract foreign investors.

The furniture and design sector is particularly promising in India in light of the great development of residential construction and the hospitality segment. Studies on the habits of the Indian consumer, increasingly attentive to international trends, confirm the high potential of the sector.

Trade in India - import export


Import export


Import


In 2016, India imported for a total value of 344 billion dollars, placing it in fourteenth place among the world's largest importers. Over the past five years, Indian imports have fallen sharply by 8.912% annualized from US $ 402bn in 2011 to US $ 344bn today. The most recent imports were led by the "Crude Petroleum" sector which represents 17.6% of all the total imported from the country, followed by gold imports which account for 6.65% on the balance.

Export


In 2016 India exported $ 256 billion worth of products, making it the 18th largest exporting power in the world. Over the last 5 years, exports have had a slight decline of 1.585% annualized from 274 billion in 2011 to 256 billion today. Recently, the sector that drives Indian exports the most is "Refined Petroleum" which represents 9.9% (25.4M USD) of the total exported value, followed by the export of diamonds which equals 9.3% (24M USD) of the total value. Following these two leading sectors are the jewelry sector (12.6M USSD) and the pharmaceutical package (11.6M USD).

Foreign investments


Foreign investments are approved according to two different procedures: automatic or governmental, according to the methods and sector of investment. In the automated procedure, the non-resident investor or Indian company does not need any approval from the Indian government for the investment. Conversely, in the government procedure the investment is allowed with the approval of the Indian government. Investment proposals that require government procedure are handled by the Foreign Investment Promotion Board (FIPB).

For production activities in some sectors it is mandatory to obtain an industrial license.

Companies with wholly foreign capital can obtain automatic approval when they operate in high priority sectors (eg production and transmission of electricity); otherwise, a request must be sent to the FIPB, which expresses its opinion on the basis of a series of parameters.

Finally, the Indian government gives top priority to small businesses, which contribute significantly to exports and employment levels and has therefore prepared a series of tax breaks.

Labor regulations


India is a member of the International Labor Organization (ILO) and complies with the conventions it has ratified.


There are numerous applicable labor regulations, including the Contract Labor (Regulation & Abolition) Act (1970) which applies to any company in which twenty or more workers are employed or have been employed on any day of the previous twelve months with a fixed-term contract. The interests of contract workers are protected in terms of wages, working hours, social security and health.

There are also several older regulations relating to specific aspects of the employment relationship, such as trade union protection (Trade unions act of 1926), the right to a bonus (Payment of bonus act of 1965) or the right to compensation in the event of accidents. or workplace accidents (Workmen's Compensation Act of 1923).

Investments in India - risks and benefits


The  advantages  of investing in India are:


Market size and demand growth: While demand is now stagnant in most economies of historical industrialization, Indian consumption continues to grow, driven by the sensitive dynamism of the "aspiring middle class", which is expanding year by year and the whose average income is constantly increasing (per capita disposable income doubled between 2005 and 2011). This positive trend in consumption is advantageous in the demographic dividend, with almost half of the population (603 million people) below of 25 years of age.

Low Cost Labor Availability: The availability of competitively priced labor remains one of the main reasons behind investment in manufacturing in India. Thanks also to a literacy rate of 74%, it is possible to find skilled and English-speaking labor, the main reason why a thriving service outsourcing industry has developed in India.

Availability of skilled resources: India has a solid and well established education system, with over 20,000 universities and training institutes, with a focus on scientific disciplines. Every year 2 million engineers graduate in India (while 2.5 million complete postgraduate studies). The number of technical and scientific graduates has doubled over the past 10 years. The availability of human resources trained in science and technology is one of the reasons why many multinationals decide to open their research and development centers here.

Availability of raw materials: India is rich in natural resources, especially coal, iron and bauxite. It is the second largest producer of cement in the world, the third of steel and the first of direct reduced iron. It is also one of the largest producers of leather in the world. Indian reserves of rare earths are estimated at 3.1 million tons, or approximately 3% of the world reserves, of which India is increasing its extraction capacities. India also has availability of cotton and a great variety of fabrics, making it a prime destination for the outsourcing of apparel companies.

The  risks  of investing in India are:


Political risks: The decentralization of powers from the central government to the authorities of the twenty-nine states that make up the Federal Republic of India is a growing phenomenon that goes hand in hand with the strengthening of local parties and makes the implementation of policies by the Central government.

Security and terrorism risk: The risk levels in the country remain significant. Over the years there have been frequent internal disorders, including violent ones, which can worsen in the pre-electoral phases and terrorist attacks of various matrices.

Infrastructure and freight transport: the inadequacy of the transport network continues to represent a significant cost. This is accompanied by rather long times for customs clearance of goods.

Access to credit: the major international rating agencies continue to place India at the lowest level of investment grade status: BBB-, Baa3 and BBB- are the ratings of S & P's, Moody's and Fitch respectively.

Energy distribution infrastructures: the necessary restructuring of the electricity transmission and distribution system in the country is proceeding slowly. Shortcomings in supply security, failure to adapt the capacity of electricity production plants and frequent blackouts are among the critical factors that companies that want to invest in the country must take into consideration.

Excessive bureaucracy and judicial slowness: a cumbersome and slow bureaucratic system of authorizations and licenses, not unrelated to corruption phenomena, is the corollary of an often complex and not very transparent legislation. Further problematic elements are given by the slowness of justice; companies wishing to invest in India are advised to include international arbitration clauses in their contracts.

 India reports


Among the strategic sectors for the internationalization of Italian companies, there are infrastructures, mechanics and mechatronics, renewable energies, the automotive sector and the agri-food technology sector.

In the twenty years from 1991 to 2011, the Italy-India trade has grown 12 times, passing from 708 million euros to 8.5 billion euros. However, starting from 2012 a decreasing trend began, which brought bilateral trade to € 7.2 billion in 2014, however, marking an increase of 3.6% compared to 2013 (source Istat). Italy is India's fourth largest trading partner among EU countries (after Germany, the United Kingdom and Belgium).

Overall, Italian exports to India in April 2015 compared to the same month in 2014 grew by 24.9%. Italian exports accumulated in the period January-April 2015, compared to the same period (January-April) of 2014, grew by 12.7% (higher than the average performance to other non-EU countries which was + 12.2% ). Italian imports from India in April 2015 grew by 13.9%; in the period January-April 2015 by + 13% (source ICE New Delhi).

Machinery and appliances continue to represent the first item of Italian exports to India, with a share of around 40%; over a quarter of Italian imports from India instead fall into the textile-clothing-leather accessories category.

As for the flow of direct investments, in 2012 Italian companies invested over 1 billion euros in India in 2012 (source Eurostat). At the end of 2012, Italy had a cumulative stock of FDI in India of € 3.75 billion.

Furnishing products are constantly growing (over 30% in recent years) and Made in Italy products are generally appreciated for the wealth of materials used, high design content, quality and attention to detail. We can certainly speak of a “positive prejudice” towards Italian products in this sector.

The luxury car and SUV sector is also starting to grow: brands such as Ferrari, Maserati and Lamborghini have in recent years opened exclusive showrooms in the main cities of the country.

A total number of over 400 legal entities and Italian factories in India can be estimated, present in three main forms: wholly owned subsidiaries, Joint Ventures (solution preferred by SMEs and mandatory in sectors with caps on foreign investment) or representative commercial offices

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