1. IMPACT OF INDIAN GOVERNMENT
ON INTERNATIONAL TRADE

2. Zinnov | 2
The primary reason behind the economic struggle
has been a weak government in the past 5 years
Governance
Related Factors
Global Economic downturn affected India’s exports and
services business
Global
Slowdown
No strong figurehead emerged from the coalition governmentLeadership Crisis
Slowdown of economic reforms made India an unsuitable
destination to run business
Policy Paralysis
Improper action plan and poor allocation of funds resulted in
delayed projects that led to overruns of 15 BN
Implementation
Bottlenecks
Government accused of multiple scams such as $5bn Telecom
Spectrum scam, $29bn Coal mine scam, etc.
Corruption

3. Zinnov | 3
Difference between single party government and
coalition government
SINGLE
PARTY COALITION
Electorate’s mandate for a
Stable Government
Empowered Government

4. Zinnov | 4
The “Growth Levers” present a massive potential
opportunity for the Technology MNCs
Total Opportunity Size for
Technology Companies
Digitization $7
B
Infrastructural
Improvements
$11
B
Push for
Manufacturing
$7.3
B
Technology in
Healthcare &
Agriculture
$0.7
B
Year
2014-15
Government Investments in
technology (Year 2014-15)
Opportunity by Technology
Areas
$26
Billion
Communication
Technology
$4 BN
Computing &
Storage
$2.6 BN
Software
$4.2 BN
Engineering &
Machinery
$6.6 BN
IT Services
$5.9 BN
IoT
$2.7 BN

5. Zinnov | 5
Modi has focused on re-energizing bilateral
relations through an emphasis on forging
investment partnerships
Japanese government’s promise of investing $35
billion (3.5 trillion yen) into infrastructure projects
in India
Areas of partnership include rejuvenation of
Ganga, smart cities, transport systems, skill
development and next generation
infrastructure
Target to double Japan’s FDI and the number of
Japanese companies in India within five years
Beijing committed investment of about $20
billion in India over the next five years
Setting up of two Chinese industrial parks in
Maharashtra and Gujarat
China will play a role in development of
high speed railways in India and the first
project will focus on upgrading some of
the existing railway lines and stations in
India
JapanChina
USA
Five-year Trade and Economic Development
Plan’ that seeks to reduce the bilateral trade
imbalance and strengthen investment
cooperation
USIBC (US-India Business Council) has identified
investments worth $ 41 billion by its members into India in
the next 3 years

6. Zinnov | 6
The first 100 days of the government has
already demonstrated positive impact
Let us script a glorious
future…
IT+IT=IT; Indian talent +
Information technology =
India Tomorrow
Don't compromise in
manufacturing; Stress
on Zero defect, Zero
effect
A son of a poor man is standing in front of
you today. This is the strength of a
democracy.

7. 5.7% GDP Growth Apr-Jun - highest in nine quarters
Aim to lower fiscal deficit to 4.1% of GDP by Mar 2015
13% Rise in NCAER’s1 quarterly Business Confidence Index in June
2014
INR 7,060 crores allocated to build Smart Cities
1.5 crore bank accounts opened in 1 day2
49% FDI limit in Defense and Insurance
14 # of IITs, IIMs and AIIMs to be setup
MODI’S 100 DAYS GOVERNMENT

8. Zinnov | 8
India is already home to the most prestigious
manufacturing companies globally
Source: World Bank – Doing Business report series, BJP manifesto
5Revive
Manufacturing
World’s 3rd largest
Motorcycle
manufacturer
One of the largest
Aluminium Rolling
companies
Biggest producer of Primary
Aluminium in Asia
World’s largest
producer of polyester
yarn and fibre
World’s 5th largest
Wind Turbine
manufacturer
World’s largest Motorcycle
manufacturer
Largest Oracle Siebel CRM
Implementation in India
World’s 2nd largest
producer of Viscose
Rayon Fibre

9. Zinnov | 9
5Revive
Manufacturing
With Modi’s impetus on “Zero Defect”
manufacturing, India will soon be the global hub
for MFG (1/2)
Source: World Bank data, BJP manifesto
152 191 185 203 246 249
892
1141
1460 1477
1813
2342
2007 2008 2009 2010 2011 2012
Manufacturing, Value Added
(USD billion)
India China
2014 2020
14% 20%
Execution
Plan
FDI in Defence
Sector
Labor
Intensive
Industries
Investment along
the Dedicated
Freight & Industrial
Corridors
NIMZs*
outside DMIC
Region
Clear Tax
Policy
Manufacturing, Value
Added ( as % of GDP)
*NIMZ : National Investment and Manufacturing
Zones | DMIC : Delhi-Mumbai Industrial Corridor
Modi aims at cranking up the share of
manufacturing in India’s Gross Domestic Product

10. Introduction : FDI
 Since 2001, India has allowed foreign direct investment (FDI) up to
26 per cent in its defence industry. The policy has, however, not
been successful in bringing about any meaningful financial or
technological inflows, primarily because of the lack of incentives in
the policy for foreign investors.
 Keeping in view India’s underdeveloped R&D and production base,
and various defence industry-related policies and provisions whose
success is contingent upon a liberal inflow of FDI, an increase in the
foreign investment cap up to 100 percent would be logical, instead
of a fixed cap-based method, which may be a constraint to desirable
inflows.

11. Defence Budget:
28.34 29.74
32.88 33.7
40.73
0
5
10
15
20
25
30
35
40
45
2009 - 10 2010 - 11 2011 - 12 2012 - 13 2013 - 14

12. ALLOCATION OF DEFENCE BUDGET SERVICE
WISE
Army Air Force Navy DRDO Other
17.48
5.21
Army Air Force Navy
DRDO OFB Other
5 1
2012 - 13 2013 - 14
24
19
1
50
27.91
0.47
48.93

13. Select Sector-wise FDI inflow, April 2000 to May 2010
Source: http://dipp.nic.in/fdi_statistics/india_fdi_index.htm.
Rank Sector
Amount of FDI
inflows (US $ million)
1 Service Sector 24,227.48
2 Computer Software &
Hardware
10,168.37
3 Telecommunications 9821.17
4 Housing &Real Estate 8519.25
5 Construction & Activities 8190.85
6 Soaps & Cosmetics 173.19
7 Timber products 37.07
8 Defence Industries 0.15
Grand Total 120,155.25

14. Year
Development
2001  Defence Sector opened to Private Industry
 26% FDI
2002  Defence Acquistion Council(DAC) created
 Buy Category introduced
2003  Buy and Make category wit ToT introduced
2004  Kelkar committee constituted for revision of Defence
Procurement Policy and participation of private sector
2005-2009  Defence Offset Policy formulated (2005) and Defence Offset
facilitation Agency (DOFA) created
 Make & Buy and Make Indian categories (2006 &
2008)introduced
2011  Offset scope enhanced to include aerospace and Internal
Security
July 17th  FDI increased to 49% (waiting for parliament approval)

15. FDI IN DEFENCE : IMPACT ON TRADE
 Greater FDI inflow in defence sector provides substantive
economic advantages.
 Transfer of advanced sensitive technology.
 Making India as a home market (major domestic sales market and
global manufacturing hub)
 Benefit to private defence manufacturers in funding as well as
technology.

16. THINK BUSINESS THINK INDIA
• The salient features of the SEZ Policy are:
• SImplified procedure for deveent , operations and
maintenance of SEZs and for setting up units and
conducting business in SEZs;
• Single-window clearance for setting up of SEZ;
• Single-window clearance for setting up units in SEZ;
• Single-window clearance on matters relating to
Central as well as State

17. MAKE IN INDIA : BACKGROUND
• The aim is to take the share of manufacturing in the
country’s GDP
• from a stagnant 16% currently to 25% by 2022, as
stated in the National Manufacturing Policy, and to
create 100 million jobs by 2022.
• India had fallen to a lowly 134th rank out of 189
countries this year (three down from 2013) in the
World Bank’s Ease of Doing Business rankings.
• Currently, it takes 12 procedures and 27 days to start
business, 35 procedures and 168 days to get
construction permits and 1420 days to enforce
contracts in India.

18. • Make In India: Origin
• This initiative has its origin in the Prime Minister's
Independence Day speech where he gave a clarion
call to 'Make In India' and 'Zero Defect; Zero Effect'
policy.
• Make In India: Aim
• To convert India into a global manufacturing hub, to
help create jobs and boost economic growth.
• To urge both local and foreign companies to invest in
India.

25. • JIGAR GALA 514
• SANCHIT GANGAR 515
• YASH JAIN 517
• MOHIT MALDE 523
• HARSH SHAH 538
• PRIYANSHU SHAH 543