© 2018 by Robert Person.  The views expressed on this website are my own and do not represent the official policy of the U.S. Army, Department of Defense, or U.S. Government.

Mar 24

Investment in India

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https://economictimes.indiatimes.com/news/politics-and-nation/india-us-have-convergence-of-views-in-economic-vision-ambassador-shringla/articleshow/68543663.cms

This article examines the relationship between the United States and India regarding their economies. The United States and India's trade in goods and service more than doubled over the last decade from $58 billion to $126 billion. Due to this large and successful increase in trade, both sides are determined to continue to find ways to improve bilateral trade and increase market access within the two countries. Exports for both countries have grown significantly. In 2018, the US exports to india reached nearly 30% and Indian exports to the US grew about 12%. The key to India's economic growth is due to its policies emplaced and foreign investment. The article states that due to India being a democracy, the US and India share many common values and aspirations. Specifically, both countries are trying to build modern efficient economies where businesses feel confident to invest and do business.

 

This article connects to the course concepts of the effect on multinational organizations and the role of democracy in development. In class we discussed how multinational corporations can either help developing countries economies or they can take advantage of their economy. Companies such as Facebook, WhatsApp, Tinder, and Uber have left a large footprint in India. The reason for foreign investment is so large in India is due to the structure and policies within their economies. Specifically, India has 100% FDI allowed in over 90% of sectors coupled with economic initiatives such as bankruptcy law, launch of commerical courts, and their IPR policy encourages innovation and creating an investor and business friendly environment. Due to the market and the policies within the country, the United States is able to benefit tremendously. While these policies look as if the United States is taking advantage of the growing Indian economy, the United States is actually trying to help it grow through promoting bilateral business. Specifically, the article states that the United States looks to continue "to helping India achieve its development goals." Part of the reason for this is due to the fact that both countries are democracies. Therefore the countries can trust one another which allows for future investment. Both countries provide law and order, enforce contracts, and have had large success over the last decade. All of which has helped with stability and certainty when dealing with trade between the two countries. While democracy has proven to be both good and bad for development, in this case it has proven to be beneficial.

 

 

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