There are nine major factors that affect the decision of setting up a new business in the country. I refer to them as the ‘9Ls’. These are:



Land acquisition
Labour availability
Loans and credit facilities
Laws of the land
Light/power, water and other resources
Local climate
Liability of taxes
Legal liabilities
Longevity, safety and security of the project


One of the major aspects is land acquisition. The Indian government and even the various state governments have initiated or are in the process of initiating some welcome steps like reduction in the number of approvals, single window schemes, online applications/registration facilities, online registration of the property records, uniform pricing mechanisms, online status tracking system etc. so as to reduce the time taken in various approvals and increased efficiency and transparency while acquiring land.


India is a youthful country, full of talent and brains; hence, skilled and unskilled manpower is easily available at low cost, especially when compared to other growing economies. Further, the national skills development mission can be seen as a major boost to create a skilled manpower bank in the country over the coming years.


Loans at special terms are available under various schemes like the Pradhan Mantri Mudra (Micro Units Development and Refinance Agency) Yojana and Bharatiya Mahila Bank, by way of grants, subsidies, corpus funds allocated for specific projects, relaxations from RBI for foreign funds, sector specific loan schemes for industries and MSMEs etc.

The cost of projects may be reduced by claiming exemptions in electricity duty, VAT, excise duty, import duty or rebate/refunds in respect thereof on fulfillment of specific conditions which are available to industries set up in the SEZs/parks.


Since Independence, India has been burdened with numerous laws, acts, rules and regulations governing commerce. Unfortunately, in the past governments were not able to identify the drawbacks of those irrelevant laws.

However, recently, the government has taken various bold steps for repealing or amending the existing set of regulations relating to running businesses in India smoothly. It has been started with the Make in India campaign to attract international companies to start business in India. Some of the significant moves are:

Amendments in Companies Act, 2013
Introduction of self-certification system, reducing the repetitive submission of applications/returns through composite online applications, online registration for PAN, VAT, Shops & Establishment Act, ESIC, EPFO
Increase in the validity period of industrial license
Promulgation of the Arbitration and Conciliation (Amendment) Ordinance, 2015 for addressing the commercial litigations
Setting up of dedicated commercial benches of High Courts for speedy disposal of commercial cases
Simplification of compliances through the development of checklists under various regulators
Relaxations in FDI norms and approvals
Separate comprehensive policies for the financial sector in GIFT City.
Establishment of Women Industrial Park in Gujarat.


Two years ago, there was an acute shortage of power/electricity in all the states except Gujarat but looking to recent developments it seems that in the coming years all states shall have the required power capacity.

As regards the availability of raw materials, most are easily available. The recently started inter-state shipment facility from one port to another can be considered as a significant move resulting in increased efficiency for uninterrupted transportation in a time bound schedule.

The proposal of linking villages through roads and rivers will make the resources easily accessible everywhere.


India has a mixed bag in terms of climatic situation and a person may easily select a suitable destination having the desired environment and climate. Nature has gifted India with the flowing rivers, sunlight and all other natural resources required for any kind of commercial activities.


The present government has assured investors that there will not be any retrospective taxes. The draft Direct Tax Code and GST bills may be passed soon, which shall rationalise the tax structure so as to remove undesired complexity and high cost of compliances.

Payment of taxes has been made compulsory through online mode only. The government has also indicated introduction of low tax rates in a phased manner. Accounting and auditing policies are being adopted in accordance with international standards.

The recently launched Start-Up India scheme and proposed tax exemptions for start-ups having innovative ideas can be seen as a major boost for young entrepreneurs.


Apart from the paying taxes and filing returns on time, a businessman is required to report/disclose the required information in the prescribed formats so as to increase corporate governance, transparency and better understating of the data and to protect the interest of investors.


Every businessman wants to put his hard earned money with long term goals with adequate safety and security. India is a country of young and talented people, most of the resources are available here and the intentions of the government are clear – to develop the country at fast pace by taking various corrective measures and multiple reforms, which are also endorsed by the leaders of all the developed and developing countries.

Hence, we can foresee the change in the mindset of the business community about India from least favourable to most favourable destination.