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Investment in India: the obstacles to growth
India has great growth prospects. But the obstacles to growth in the country should not be underestimated, say fund managers.
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Shah believes that the government has been hampered because of coalition politics over the last year. He says that the necessary reforms are not happening because the government has had its 'hands tied'. However, since the recent elections they have secured a bigger majority, so he is positive that they will now be able to get more policies through.
First State’s Reddy agrees that there is a 'huge issue of bureaucracy and red tape in India.'
For him 'reform is not just about bringing in capital, it’s also about bringing in expertise which is something that is not yet appreciated enough.'
But for Aberdeen's Lim this presents a unique opportunity.
‘The difficulties are what make the opportunities so attractive.’
‘There are always tensions between various government agencies but better co-ordination will boost the potential.’
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3 comments so far. Why not have your say?
steve tye
Jul 27, 2010 at 15:56
I have had dealings on a personal and business level with Indians and have often found them very difficult to deal with, this seems to be a cultural issue, and I have heard similar comments from people I know.
This would colour any investment decisions on my part.
report thisMartin Drew
Jul 27, 2010 at 18:56
I do business with India and go and work in the offices of my partners there in an area of Delhi which is 100% Indian. In fact on one stay of two weeks I didn't see another European the whole time I was there. I find them very easy to work with, very quick to catch on to new ideas and keen to make the relationship work and grow our businesses.
report thisDavid Rowse
Jul 28, 2010 at 18:40
"..... He says that the necessary reforms are not happening because the government has had its 'hands tied. However, since the recent elections they have secured a bigger majority, so he is positive that they will now be able to get more policies through."
Does this ring a bell about another country (with a high number of people unemployed ((and perhaps unemployable))) and where increasing bureaucracy and policies and procedures (Health and Safety, etc, etc,) restrict any form of growth? Pots and kettles? We invented the civil service, not them.
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