India is expected to surpass China's population in the next two decades and have a younger workforce. Its economy has grown significantly in recent years at an average annual rate of 8.4%, though growth slowed in 2012. While India's economy is led by services, agriculture and industry also contribute. India faces barriers to further development like regulations discouraging business and corruption, but its large skilled workforce in areas like IT has helped drive growth. Growing economic power presents opportunities for both Indian individuals and businesses, but also threats from increased competition and costs. The UK sees opportunities in partnering with India in sectors like infrastructure, manufacturing, and healthcare. However, doing business in India carries challenges from its legal system and potential threats to UK jobs.

1. The likely impact of the
growing economic power
of India
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music

2. Population size
India
In next 2 decades is expected to
surpass china’s population
In the future its population will be
younger than Chinas so will be more
able to fill job vacancies – will only
work if education improves

3. Economic growth + predicted
economic power
India
Can get close to USA GDP by 2030
Growth rate slowed in 2012
367 million will be lifted out of
poverty by 2015
Average annual GDP growth from
2004 to 20011 was 8.4%

4. India’s economy
55.3%
16.1%
28.6%
India
Service
Agriculture
Industry

5. How the country has developed
India
 Less keen to encourage
foreign direct investment
 Many regulations
discouraging new business
start ups
 Lots of engineering and IT
graduates
 IT specialists opened
competitive businesses that
could export IT services
 Quite a few citizens still
work in agriculture. As India
develops more areas of
expertise this’ll change

6. Imports and exports
India
 More imports than
exports
 Manufacturing sector is
behind Chinas because
China was the first to
offer big benefits from off
shoring

7. Purchasing power and foreign
investment
India
 India is increasing the
amount of FDI outflows
to other countries
 21st largest outward
investor
 Powerful enough to
acquire some of the
worlds leading
companies

8. Barriers to market entry
India
 Difficult market to enter
because of culture, society
and language differences
 World bank rates it as
122nd easiest place to do
business in the world
 Joint venture seen as most
viable way to enter the
market
 Corruption and
bureaucracy still major
issues

9. Growth and development of
India: impact on individuals
Positive
Lower prices
More choice
More job
opportunities when
incomes rise
Negative
Jobs may be lost
due to competition
from imports
Jobs may be lost
due to outsourcing
or producing abroad

10. Growth and development of
India: impact on businesses
Opportunities
Access to new markets and
increasingly wealthy customers
Access to new skills e.g. India's IT skills
Off shoring may reduce costs
Access to new trade areas
May get FDI from growing economies
Threats
Competition from low cost producers
High competition may reduce market
power
Chinas low exchange rate makes it
difficult to compete
Emerging economies have high
demands for commodities and energy
so it may make costs for them increase

11. Trade opportunities for UK +
other firms
India
 Indian government is investing
£600 billion in infrastructure
e.g. Roads, railways. UK has
world class companies in
these areas.
 Manufacture is expanding.
Opportunities for British
engineering firms with high
end technology
 Healthcare sector expanding –
uk businesses that specialise
in pharmaceuticals should
thrive
 Entertainment and media
sector worth £15 billion – new
opportunities for UK
technology + content
businesses.

12. UK Business going to India
• It allows businesses to outsource and save costs
• By building a relationship with India and taking their
business there UK businesses can take advantage
of the Indian middle class consumers
• India was part of the British Colony so they
understand UK culture
Opportunities
• Laws are often changed and are tougher than they
are in the UK, therefore it can be difficult to operate
• Putting energy into outsourcing may not work
• India’s educated may take UK jobs which will
increase unemployment in the UK
Threats

13. Effects on India of UK
business
Positive
More Jobs
New Skills
Improve Infrastructure
Introduction of new
technology
Negative
Safety concerns
Local businesses have
more competition
Weakening of traditional
cultures
The business lacks
commitment to the host
country