Despite the present Covid 19 crisis and the economic downturn, India has emerged as one of the top three choices for overseas investments in the next 2-3 years, according to the FDI survey released by the Confederation of Indian Industry (CII), in association with EY. The respondents have pinned down market potential, skilled workforce, and political stability as the top three reasons to make India their favoured destination.
Other key factors which contribute to the attractiveness of India as an investment destination include cheap labour availability, policy reforms, and availability of raw materials.
According to the survey, more than two-thirds of the MNC respondents, India is the number one choice for future investments. 25% of the respondents, who represent non-Indian HQ MNCs, view India as the first choice for future investments.
The survey shows that more than 80% of all the respondents and 71% of the non-Indian headquartered respondents plan to make investments globally in the next 2-3 years.
About 30% of companies are planning to invest more than $500 million. About 50% of respondents see India amongst the top three economies or leading manufacturing destinations of the world by 2025.
The CII-EY FDI survey on the theme, ‘How can India step up its game?” has been brought out to gauge the market sentiment amongst the Indian as well as non-Indian MNCs.
Recent reforms in the country such as corporate tax cuts, Ease of Doing Business measures, simplification of labour laws, FDI reforms, and focus on human capital have emerged as the top drivers for fresh investments. Non-Indian HQ MNCs have also opined that major investment in infrastructure and 100 Smart cities as well as financial sector reforms will also help in establishing India as a favorable destination for FDI.
“The CII-EY survey results strongly indicate that India will be the next global investment hotspot with a high proportion of MNCs placing it at the top of their investment agenda,” said Chandrajit Banerjee, Director General, CII.