For NRI investors, the coming days will see substantial positive changes in the investment environment in India.
Azadi Ka Amrit Mahotsav – A Milestone
The iconic event celebrating 75 years of our independence and our glorious history of people, their culture and culture was the Azadi Ka Amrit Mahotsav (AKAM) by the Government of India. It is an initiative to bring together people who have helped to shape the country’s journey this far but also held the potential to support the vision of India’s Prime Minister, Narendra Modi’s vision of activating India 2.0 with the spirit of Atma Nirbhar Bharat (Self-Reliant India).
This journey started in March 2021 as a 75-week countdown marking the independence anniversary and continues till August 2023. Department of Investment and Public Asset Management (DIPAM) on this occasion organised a Nationwide conference on “Creating Wealth through Market” as an iconic event in 75 cities across the country in June 2022. This is the initiative to educate and empower people in 75 cities with regard to investments and also create wealth based on the guidance given by the government to ensure the financial growth of the citizens.
The session included 75 different speakers in 75 different cities comprising financial experts, bankers, professionals and also influencers who spoke about:
The growth of the Indian Capital Markets in the past 75 years
- Women rising as independent investors
- Role of the Government and the market players in improving Market confidence
- The road to financial well-being is by being financially literate.
- The future of the Indian Capital Markets i.e. Amrit Kaal
The steps taken by the government have created a positive environment for investment for NRI investors in the Indian market, key focus and elements indicate the efforts and importance taken by the Ministry of Finance to make this centre of attention.
How the 2022 Budget has been focused on creating a positive environment for NRI Investors
The global investment in FDI has shown strong trends, from the recent “ Global Investment Trends” saw a strong recovery in 2021, an increase of 77% estimated to $1.65 trillion, from $929 billion in 2020 which is above the pre-covid figures.
In the financial year 2020-21 India had the highest flow of FDI amounting to US$ 81.72 bn.
- Singapore being the top investor country is at the apex with 29%
- Followed by USA (23%) and Mauritius during this time.
When we see sector-wise it’s the
- Computer Software and hardware with a share of 44% of the total Equity inflow
- Followed by construction or infrastructure activities at 13% and
- The services sector contributed 8%.
The recent 2022 budget presented by the Finance Minister of India was applauded and emphasised that this is the right time to invest in India, the government has taken up reforms and measures on the fronts of the FDI policy reforms, and there is easy investment facilitation and ease of doing business resulting in increased inflow of investments in the country. India’s economy is fast changing and it is now a preferred destination for foreign investors.
India’s FDI stood at $36 Bn in 2013 but today it has crossed $80 bn as addressed by the Prime Minister and budget as a step towards making modern India. Union budget 2022 has made several provisions to take this a step ahead.
The positives are supported by the strong pace of vaccination, India’s GDP has grown at 9.2% in 2021-2022 and is projected to be the highest among the larger nations. The nationwide conference connecting major cities in India speaks of the further effort to create a smooth and favourable for NRI investors. We can see that investor confidence is strong in sectors such as infrastructure which supports long-term financing and overseas investment programmes.
The recent proposal to the Union Cabinet by the Department for Promotion of Industry and Internal Trade (DPIIT)
To seek approval for making changes in the FDI to facilitate the disinvestment in LIC. India currently allows 74% of FDI in the insurance sector which does not include the LIC. This is a new door and yet needs to be seen as a work in progress.
The Prime Minister of India has been very interactive with the Indian Diaspora, for example, his recent visit to Berlin, Germany comes at a time with Russia is at war with Ukraine and the region faces challenges. He emphasised that India does not look at a secure future alone, it takes risks and innovates. He said around 2014 there were 200 – 400 start-ups only, but today the country has more than 68,000 start-ups. This has built the confidence of the NRI community and given them a feeling of inclusiveness to build a positive mindset for investing in India. Similar visits have been made to Europe, USA and also countries like Bangladesh.
The nationwide conference for creating wealth through markets, support of the government through the 2022 budget easing the terms of carrying business long with reform measures, and connecting with the Indian community have already shown the path of a positive environment for NRI investment options in India. NRI’s have a plethora of options to choose their investment.
The interesting news is from the Foundation for India and Indian Diaspora Studies (FIIDS) USA which has urged Finance Minister Nirmala Sitharaman to allow non-resident Indians to invest in the Indian Stock market, which is supported largely by the Indian community abroad. It is a good opportunity to keep an eye on the further development that comes this way.
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Do you from many NRI investors think you would like to make the most of this opportunity? If yes, wouldn’t it be great to get some expert advice to better plan the investment ideas in India? This would make way for a safety platform and help to access the risk factors to keep your financial worries away. Contact NRI Money+ to guide you with a free consultation.
Donald G. is the Principal Consultant at NRI Money+. He specialises in creating personalised financial plans for NRIs (Non-Resident Indians) and HNI (High Net-worth Individuals).
