India can thrive economically in the post-Covid world if it brings changes in policies to welcome global investments, including doing away with a large number of approval requirements for foreign direct investment (FDI), say experts.
During a webinar on 'Investments into India and the USA' organised by the Indo-American Chamber of Commerce (IACC) and Invest India, experts discussed strategies to ease international business making way to India, boost Indo-American economic cooperation and look at two-way measures to benefit both the economies.
According to them, India needs to act now to allow ease of doing business, reduce tax and regulation bottlenecks and aid foreign companies who are exiting their bases in China.
"India needs to develop the art of visualisation... It's not easy to uproot all of the current investment from China to India overnight," said Nishith Desai, Founder and Partner at Nishith Desai Associates.
The current anti-China sentiment is fuelling many international businesses to rethink their Chinese bases. However, Desai was of the view that someone who has invested a lot in infrastructure, land use and technology will need a haven that welcomes international businesses.
"It is not very easy to migrate from China to India. For manufacturing, we need to be careful about environmental issues, especially around pollution," he added.
Dave Springsteen, Partner at public accounting firm Withum, said that foreign businesses who seek to develop roots in India have to face a committee of secretaries from 35 Central ministries or departments, besides an overall regime of 767 pre-operational licenses.
"That's beyond all inspections, approvals and renewals you need after the work begins, he said, adding that for the Indian side, the barrier stems from the lack of single-window clearance for investors.
Sunil Kaul, Managing Director & Head, Southeast Director Asia for the Carlyle Group, noted that India will compete with a lot of Southeast Asian countries, like Vietnam, which are very welcoming to foreign companies.
"We need to keep simplifying our tax systems and provide ease and predictability in tax systems and regulatory systems so that people who want to invest are aware of what they're getting into," he said.
Timothy R. Lavender, Partner at Kelley Drye, said that many Indian businesses who decide to set up base in the US, face similar issues, such as "the lack of proper paperwork, according to different states and the federal departments".