Assignment for Indian Business Environment

Roll no-22,Sagar Ajay Agrawal

DOING BUSINESS IN INDIA

Doing business in India in the 21st century is on one hand not so much different than
doing business in any other emerging or industrialized country. On the other hand
doing business in India is a unique undertaking if one expect optimum outcome in a
reasonable time.

Why this is the case?

India is a country with a distinct philosophy, ideology and ethos. India was under
outside threats from the 11th century when her trades and economy were at her peak-
The best in the world. People of India lived under outside rulers for 750 years until
her independence in the mid 20th century. Ironically all those influences did not affect
much of her core ideology and identity.

One’s ideology and identity makes the character and personality of the country.
Though India externally seems to be reasonably comparable with the western world,
India remains an interesting and mystic society – understanding India requires serious
learning and dedication.

In Max Muller words:

“If I were asked under what sky the human mind has most fully developed some of its
Choicest gifts, has most deeply pondered on the greatest problems of life, and has
found solutions, I should point to India.”

-Max Mueller, German Scholar, 1823-1900

Successfully doing business in India requires an array of complex skills and sound
Understanding of the nation and its people compared to the knowledge needed to do
business in most other emerging and western countries. Followings are a few key
areas one might build competence in:

(1) Origins of India: Historical and Contemporary India

(2) Culture of India: Society, Spirituality, Belief-systems, Rituals and Customs
(3) Economics, Business and Politics of India
(4) India as an Emerging Market: A two Market system
a. Commercial Center b. Rural India- Market
(5) Work-force and human resource management in India
(6) Management Style
(7) Communication, Negotiation and Deal –sealing in India
(8) Education and Educational Institutions in India
(9) Living in India – the Infrastructure and Public Services
 WHAT IS INDIA

India is not simply a geographic location. It is a concept that is continuously

shedding, shaping and reshaping like an epidermis-outer layer of an organism. India is
alive with both multiplicity and continuity. It is an unusual blend of cultures,
religions, races and languages. The nation's identity and social structure remain
protected by a rich cultural heritage that dates back at least 10,000 years, making
India one of the oldest formal social-systems in the world.

Recent genome analysis: Indian is the mother of all Asians. The ancestors of
the contemporary population of China, Japan and other East Asian countries
Migrated from India, according to a research study conducted by a team of
Scientists from 10 Asian countries. India, China, Japan, Indonesia, Malaysia, the
Philippines, Singapore, South Korea, Taiwan and Thailand were all part of this
Scientific study and analysis.

ONE OF THE FASTEST GROWING MARKETS

The Indian market with its over 1.1 billion populations, presents attractive and diverse
opportunities for international companies that have appropriate and suitable products,
services, and commitment. India’s requirements for equipments and services for
major sectors such as energy, environmental, healthcare, education, research, high-
tech, infrastructure, transportation, and defense will exceed tens of billions of dollars
as the Indian economy further expands internally and globally. India’s middle class is
estimated to be as large as the entire population of the United States. India’s GDP
grew at the rate of 8.7% in 2007-08, and it has potential for a sustained growth of 7-
10% for the next ten years.

India as an emerging Market

SOME FACTS AND FIGURES OF INDIA

Official Name: Republic of India

Independence: 15 August 1947 (from British)
Government type: Federal Republic
Capital: New Delhi, Financial Center: Mumbai
Legal system: Based on English common law; limited judicial review of legislative
acts;
Currency: Indian Rupee (Rs)
GDP: $1.16 trillion,
Per Capita (PPP): $4,139 (2007-08)
Geography: India has vast open ocean-fronts (east, south and the west) and on the
north it has :
• Himalayan mountain range.
• Location South Asia bordering the Arabian Sea to the west and the Bay of
• Bengal to the east. India shares land boundaries with Bangladesh, Bhutan,
Burma, China, Nepal, and Pakistan
• Area 3,287,590 sq km
Population Total - 1,129,866,154 (July 2007), Urban population (% of total) - 28.4

Age structure:
• 0-14 years: 34% (male 189,487,322; female 174,123,490)
• 15-59 years:56.9% (male 303,400,561; female 282,238,162)
• 60 years and over: 7.5% (male 37,768,327; female 38,853,994) (2001 census)

Population growth rate: 1.60% (2007 est.)

Life expectancy at birth: Total population: 68.59 years (2007)
Male: 66 years (2007),Female: 71 years (2007 est.)

Literacy
(2001census): Definition of Literacy: age 15 and over can read and write
Total population: 64.8% Male: 75.3% Female: 53.7%

Religions

Hindu 80.5%, Muslim 13.4%, Christian 2.3%, Sikh 2%, Buddhist 0.8%, Jain 0.4%,
other 0.6%

Languages

India's 1.1-billion people speak more than 6,500 languages and dialects, according to
the 2001 census. However, many of the spoken languages and dialects are in the
verge of extinction due to low population and none or little use for livelihood.

The major official language of the India is Hindi that is the primarily used by over
300,000,000 people. Other most common regional official languages are: Bengali,
Telugu, Marathi, Tamil, Gujarati, Malayalam, Kannada, Oriya, Punjabi, Assamese,
Kashmiri, and Sindhi. Though English has associate status, it is the most important
language for academic, political, and business communication. English has become a
"lingua franca" and is the accepted language for commerce and government works.

~~ Ryan Baidya, PhD, MBA

Steps to Starting a Business in India

It requires 13 procedures, takes 30 days, and costs 66.06 % GNI per capita to start a
business in India.

List of Procedures:
1. Obtain director identification number (DIN) on-line
2. Obtain digital signature certificate on-line
3. Reserve the company name with the Registrar of Companies (ROC) on-line
4. Stamp the company documents either at the Superintendent or an authorized bank
5. Present the required documents along with the registration fee to the Registrar of
Companies to get the certificate of incorporation
6. Make a seal
7. Visit an authorized franchise or agent appointed by National Securities Depository
Services Limited (NSDL) or Unit Trust of India (UTI) Investors Services Ltd to
obtain a Permanent Account Number (PAN)
8. Obtain a tax account bumber for income taxes deducted at source from the
Assessing Office in the Mumbai Income Tax Department .
9. Register with Office of Inspector, Mumbai Shops and Establishment Act
10. Register for VAT before the Sales Tax Officer of the ward in which the company
is located .
11. Register for profession tax
12. Register with Employees' Provident Fund Organization
13. Register for medical insurance (ESIC)
 
India In India procedures under the 2002 Securitization Act have become more
effective, easing the process and reducing the time required to close a business.