The Confederation of Indian Industries (CII) and EY has published a report titled ‘Vision — Developed India: Opportunities and Expectations of MNCs’.
- The report says that, India has the potential to attract Foreign Direct Investment (FDI) flows of $475 billion in the next five years due to the focus on reforms and economic growth.
- The report noted that FDI in India has seen a consistent rise in the past decade, with FY 2021-22 receiving FDI inflow of $84.8 billion despite the impact of the pandemic and geopolitical developments on investment sentiment.
Causes of Optimism
- India is seen as an emerging manufacturing hub in global value chains,
- It is also seen as a growing consumer market,
- India is also as a hub for ongoing digital transformation.
- In a rapidly changing geopolitical environment, India’s large and stable democracy and consistent reform measures are recognized by the MNCs (multinational company).
- 71% of MNCs working in India consider the country an important destination for their global expansion.
- The optimism is driven by both short-term as well as long-term prospects.
- A majority of MNCs feel that the Indian economy will perform significantly better in 3-5 years backed by 96% of respondents being positive about overall India’s potential.
- The confidence in India’s potential stems from strong consumption trends, digitisation and a growing services sector, along with government’s strong focus on infrastructure and manufacturing.
- The Indian government’s consistent efforts to reduce regulatory barriers is also stoking the positive perception among MNCs.
