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INVESTMENT SCENARIO IN INDIA

PRESENTORS:
 
B.B.D.I.T. GHAZIABAD
 
 

DIWAKAR CHATURVEDI
chaturvedidiwakar9@gmail.com
09456631311

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Introduction
• India is the 4th largest economy
and has the 2nd GDP among
developing countries.
• India is poised for growth
with macro –economic
stability and by 2025
Indian economy is
projected to be about 60%
in size of the US economy.
• In this post we try to
analyze current scenario of
investment in 3 core
sectors:

(1) Infrastructure,
(2) Education and
(3) Security
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Infrastructure Investment…
• India has emerged as land of opportunities for
infrastructure sector.
• For emerging economy like India, with more than a billion
people, infrastructure, which provides essential services, also
reflects reliability, assurance, low-cost production, and market
competitiveness.
• In the last few years a number of Road Projects have been
taken up under ambitious National Highway Development
Programme costing about US$ 12 billion.
For infrastructure we have taken following sectors  
The transport business Ports
Roads Railways
Airport Urban Infrastructure
The telecom
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The transport business….
Number of private transport projects with government
payments, 2007-08
Countries Transport projects

with government payments Total

Brazil 1 4

Ecuador 2 5

Chile 1 3

Colombia 1 7

Hungary 1 2

India 50 97

Mexico 7 21

Peru 8 10

South Africa 1 1

Total 72 150
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RAILWAYS
The Indian Railway is one of the
largest railway systems in the world
under a single management and
manages more than 63,000 km of
railway tracks.

The Government of India has


offered over 500 acres of land to
private developer across the
country for the development of
railway stations, fright terminals
and rail link projects.

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 Railways had a surplus of25,000 crores in last
financial year.
 The profit was 90000 crores in 2008–09.
 The annual plan for investment in 2009-10 is
37,905 crore.
 Railway has the monopoly in freight and passenger trains
there is an enormous strain on the existing network of rail
tracks. So government of India has decided to invest about $ 5
billion to enhance the rail routes in India.
 With private container operations starting to become a reality,
internal transport efficiency will have knitted domestic
markets together like never before. 6
AIRPORTS
 There are 126 airports in
India that are owned and
operated by the Airport
Authority of India. These
include five airports in the
major metros that account
for the majority of traffic.
 The Airport Authority of
India had invested about Rs
1500 crore to modernize at
least ten non-metro airports
in the country in 2008.

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 By the way of incentives 100% tax exemption for air port
projects for10 years.
 100% FDI is permitted for Greenfield airports under the
automatic route.
 A high demand for investments in aviation infrastructure is
estimated to about US$ 9 billion for airport development over
the next 5 years.
A greenfield airport is one where a private entity or a public-private joint
venture builds and operates a new facility, entering into Build-Own-
Transfer (BOT) or Build-Own-Contracts (BOC).

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URBAN INFRASTRUCTURE

The success of the Delhi


Metro Rail has prompted a
few mega-cities to make
determined efforts to have
metro rail as mass rapid
transit system.
India is now being the
country of the cities. The
increasing urbanization is the
opportunity for the private
investment.

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Alone in Delhi we can see…

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THE TELECOM
The telecom industry is one of
the fastest growing industries
in India.
With 4.5 to 5 million new
telephone connections being
given out every month, Phone
ownership is growing rapidly
in India.
India has nearly 200 million
telephone lines making it the
third largest network in the
world.

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 After China and USA with growth rate of 45%, Indian telecom
industry has the highest growth rate in the world.

• TRAI issued a consultation paper again on ‘Issues relating to


Convergence and Competition in Broadcasting and
Telecommunications' to resume the debate on convergence.

• Government of India permits 100% FDI in telecom equipment


manufacturing.
• 74%-100% FDI is allowed in various telecom services.
• Govt. has appointed a committee to design unified and single
levy in telecom sector.
• 150% growth has been expected by govt. in telecom so
investment opportunity of $ 22 billion is being offered to
foreign and /or private players. 12
PORTS
India has 12 major ports and
187 minor ports along its
extensive coastline. The
major, ports, that handle
about 74% of the total
traffic handled cargo of over
463 million tones in the last
fiscal year, which was an
increase of 9.5% over the
previous year.

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 Under the automatic route 51% foreign equity is permitted.
 74% FDI is permitted in construction and maintenance of ports
and harbors.
 100% FDI under the automatic route is permitted for port
development projects.
 There is no tax payable for a period of 10 years on
development investments.

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Roads
India has a road network of 3.3
million kilometers which is the
second largest in the world.
Roads carry about 65% of
fright and 80% of passenger
traffic. But their quality and
extent is not adequate
Government of India with and
incentive to increase the
investment in highways and
roads has granted a 100%
income tax exemption for a
period of 10 years for all road
development projects. 15
Present meltdown…

• In the present economic crisis when all sectors are facing the
heat of downturn, infrastructure sector comes with no
exceptions.
• The major hindrance coming in way of growth of this sector
is scarcity of funds.
• In recently announced fiscal package by government, in order
to boost investment in the infrastructure sector, the
government authorized the state-run India Infrastructure
Finance Co. Ltd (IIFCL) to raise Rs.100 billion through tax-
free bonds by next March.

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INVESTMENT SENARIO IN PRIVATE
EDUCATION IN INDIA…
.
Indian education system has
witnessed an impressive
growth path since
independence. From just 0.1
million in 1947, enrollments in
the country have grown to
more than 11 million in 2005-
06.
Despite the fact of rising
enrolment figures, the
cumulative expenditure
of states on educational
services as a % of total
expenditure has shown
a decline of 18% in 17
2007-08.
Per capita fund flow to education in 2007-08 was…

state In Rs.

Uttar Pradesh 483

Bihar 487

Maharashtra 1034

Kerala 1034

Himachal Pradesh 1777

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Boom in the Security Industry…
Private security in India will
become a Rs 50,000 crore (Rs
500 billion) industry in four
years as corporate have increased
their spending on safeguards
after the Mumbai terror strikes.
The increasing terror, developing
infrastructure like malls,
colleges, buildings, public places
are enhancing the demand of
private security guards.

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 The private security business, a Rs 22,000 crore (Rs
220 billion) industry now, would touch Rs 50,000
crore as security all of a sudden has become top
priority for Indian Inc.
 Terrorism now is a universal phenomenon and most
countries are facing it.

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The occupation project and the wage prospects are….

Occupati 1998 Projected Projected Wage Median


on Employm 2008 Annual Range Wage
ent Employm Openings
ent

Guards 61,920 75,140 2,870 $6.75- $8.46


$12.39

Janitors & 84,970 92,140 2,560 $9.16- $12.84


cleaners $15.29

Cleaning & 18,530 17,930 390 $10.43- $12.72


building $14.34
service
workers,
n.e.c

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Conclusion…
After going through the data and figures in the infrastructure,
education and security in the Indian market, it is clearer that
even in this tough time India has a lot of opportunities for the
investment and growth in a number of fields which shows that
we are not much effected by the global meltdown as other
countries around the globe are.

Thanks.

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