The Government of India has taken significant initiatives to strengthen the economic credentials of the country and make it one of the strongest economies in the world. India is fast becoming home to startup companies focused on high growth areas such as mobility, e-commerce and other vertical specific solutions - creating new markets and driving innovation.
Owing to higher infrastructure spending, increased fiscal devolution to states, and continued reforms in fiscal and monetary policy, the Indian economic outlook has strengthened. Current government is striving to move steadily to minimise structural and political bottlenecks and bring back investment and economic performance back to the path. GDP growth is expected to accelerate on account of accommodative monetary policy in 2015-16 as inflation shows declining trend and capital expenditure picking up.
India has emerged as one of the strongest performers in terms of deals related to mergers and acquisitions (M&A). The total transaction value of M&A involving Indian companies stood at US$ 26.3 billion with 930 deals in 2015 as against US$ 29.4 billion involving 870 deals in 2014. In the M&A space, telecommunications was the dominant sector, amounting to 40 per cent of the total transaction value. The deal momentum is likely to see an uptrend in the coming months on account of improving economic growth.
With the improvement in the economic scenario, there have been quite a few investments in various sectors along with M&A in India. Some of them are as follows:
Reliance Industries Limited (RIL) has implemented a ‘soft-launch’ of its 4G telecom service business in December 2015 by rolling out services for employees and their relatives, with a target to execute a commercial launch from March-April 2016.
The Government of India has taken several initiatives in various sectors to improve the overall economic condition in the country. Some of these are:
According to The World Bank, India's economic growth is expected to rise to 7.5 per cent in 2015-16, followed by further acceleration to 7.9 per cent in 2016-17 and 8 per cent in 2017. This is on account of India’s attempt to implement reforms to unlock the country's investment potential to improve the business environment, liberalised FDI policies, quick solution to the corporate disputes, simplified tax structure, and a boost in both public and private expenditure.
The total expenditure by government of India on IT is expected to reach US$ 6.8 billion in 2015, an increase of 5.7 per cent year on year, according to Gartner.
Government of India has joined hands with Belarus and has decided to extend a US$ 100 million line of credit for joint ventures with the east European country which has shown interest in the flagship Make in India initiative.
Exchange Rate Used: INR 1 = US$ 0.0147 as on March 01, 2016
References: Press Information Bureau (PIB), Media Reports, World Bank, Department of Industrial Policy & Promotion (DIPP), Grant Thornton, Database of Indian Economy (DBIE)