Planning to start a new business? Read along…

Published on December 23, 2021

Introduction

Today India is viewed as one of the big powers in the global economic market. India’s economy significantly affects international trading, even though it is a developing nation. Owing to the ever-increasing market base and over-spending habits of the middle-class population, India is considered a preferred destination for investors and businesses. In this blog, we will discuss different parameters related to doing business in India in 2021

Here’s a snippet of what we shall be discussing:

The economic status of India amidst pandemic
Scope of business growth
Advantages that the Indian market offers to business
Challenges that you might face
How Felix Advisory assist entrepreneurs to set up their businesses in India

The economic status of India amidst pandemic

The pandemic has affected all equally; still, few businesses have suffered more than others. The primary reason was their unpreparedness for a calamity of this scale. The pandemic has caused supply chain disruption and inflation in nearly every business and industry, which may seem hard to bounce back from.

According to McKinsey Global Survey, “The vulnerability over the pandemic is not an immediate economic concern to global leaders. However, the real threat on the face of the global economy is the supply chain disruption and inflation.”

The good news is that with the situation getting back to normalcy, businesses are back on track and people are more than desperate to receive the required products and services. The change in scenario is now fuelling the country’s economy; after all, the economic growth is directly proportional to increased revenues or profits.

Scope of business growth

As stated in the previous section, the economy is rounding back to normal in India. With a changing landscape, people have inclined a lot towards online business and marketing, giving several business opportunities. For instance, the fear of going in a crowd has pushed people to opt for online shopping, paving the way for entrepreneurs to develop e-commerce sites.

Today, India has got multiple scopes for investors and entrepreneurs for business opportunities in India. In particular, business opportunities in India can be seen in education, automobiles, media, food, real estate, and more, making this nation the best for a small business opportunity in various segments. The best areas to invest in SME and retail business.

Several factors contribute to the growth of small scale businesses in India, including:

A large contribution to domestic creation
Low investment cost
Huge export earnings
Abilities to foster proper native technologies
Operational adaptability
Innovation oriented businesses
Competitiveness in the domestic and homegrown market

Some of these points are discussed in detail in the next section.

Advantages that the Indian market that offers to businesses

There are many advantages of doing business in India, a few of them are discussed below:

Big population – With a big population comes big needs and big business opportunities. There will always be buyers if your product or service caters to their problems. It is easier for a population so large to target a group or a community for marketing as word-of-mouth marketing work seamlessly with such a population.
Business-friendly laws – Several essential bills have been passed that enable a smooth business setup in India. These bills include the Goods and Services Tax, the Direct Taxes Code, Land Acquisition, and the Companies Bill. With such ease, any startup can actualize its plan to scale up its business.
Low operational cost – Having moderate tax strategies, there are advantages in reduced operation cost while starting a business in India. There are chances to avail a low-cost operation in areas such as infrastructure, labor, salaries, to anything that is needed to set a business.
Government aids – The Government of India has put efforts to gain foreign investments in various sectors. Time after time, it has introduced several initiatives to aid promising startups with financial help. For instance, the ‘Make in India’ has increased the folk artisans’ visibility worldwide, giving them a chance to earn fair wages for their hard work.

Challenges entrepreneurs might encounter while opening a business in India

As rosy it may seem, there are some pain points to consider while opening a business in India.

Ease of doing business – Several metrics pose hindrances while starting a business, such as enforcing contracts and registering property. Entrepreneurs and startups find the number of required steps to be quite many.
High tariffs and protectionist policies – Indian government has provided time to time business reforms to enable free-trade ideology; still, the rise in protectionist policies has seen a surge. India’s average tariff is highest among the other G20 countries and ranks the same inbound tariffs rates in WTO.
Vast and fragmented market – The size of the Indian market is a big challenge for investors and businesses. The rules, regulations, regulatory laws, and policies run differently for different states. This is further made complex by the cultural diversity that requires businesses to provide tailored service to a particular state or culture if it decides to grow its base to pan India.
Safeguarding intellectual property – It is crucial to comprehend the intellectual property issues inside the country. The local laws are exhaustive and, for the most part, viable with EU and U.S. IP laws; there is some worry about the implementation of these laws. There are two significant concerns in protecting intellectual assets: bureaucratic delays and the absence of transparency.

How can Felix Advisory assist entrepreneurs to set up their businesses in India?

As an expert in tax and regulatory aspects, financial & business advisory, internal audit, and corporate governance services, Felix Advisory can aid businesses of any size in fulfilling the prerequisites to start a successful business in India. Their holistic approach considers every possible pain point that a business might encounter, suggesting an optimal solution to overcome the barrier. With the combined strength of expertise and experience, they create a tailor-made solution for any business.

Hope this article has helped you know more. Felix Advisory can help you with Best-in-Class financial Services.

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