India has become the fastest growing large economy in the world. It has doubled its GDP to 2.5 trillion dollars in the last decade and that is expected to reach 6 trillion by 2027. It is now the world’s fourth largest economy and will become the third largest by 2025. It will also be the youngest country in the world with 20% of the world’s working age population.
The Indian government has committed to creating a better environment for business in the hopes of encouraging domestic growth and foreign direct investment (FDI). FDI will soon reach the $100 billion dollars. India’s biggest attraction for foreign investors are the 3D’s – demand, demographics and development along with strong economic performance and the size of the Indian market. The retail, aviation, and biomedical industries are the major catalysts bringing FDI into the country.
The government wants to grow the manufacturing sector at home and encourage Indian companies to expand internationally. Major reforms include demonetization in 2016 and a streamlined tax structure.
India’s rising affluence and mass migration from the country into the cities is increasing domestic demand and consumption. By 2050, over 350 million Indians are projected to migrate to the cities creating significant pressure on the resources of urban centers. The Indian government has pledged to invest over $1.5 trillion in infrastructure projects across highways, railways, ports, airports, and industrial corridors by 2022.
In summary, India’s economy is growing rapidly spurred by the government’s efforts to improve business environment and encourage foreign investment.
