How Technology Makes India Attractive To Investors

Whether you're investing or looking to invest, technology makes India more attractive to do business. From financial services to telecom and more, we're exploring how technology affects businesses in the country.

Fintech

Increasing financial inclusion and digital adoption have contributed to the fintech sector's growth. It is expected that by 2026 the FS market cap in India will reach $350 billion. But the industry faces several hurdles. The key is regulation.

Fintechs face challenges in building business models that can sustain the competitive environment. They must focus on creating a superior customer experience. This will require investment in deeper customer engagement and retention. Investing in advanced analytics can help identify customer needs.

Photo credit: JJ Ying

Services

Across the globe, services technology is making India attractive to investors. It has become a breeding ground for numerous fintech startups. These companies aim to bring financial inclusion to the doorsteps of the unbanked. 

Better technology helps attract international companies in various forums. They offer safe and convenient transacting experiences and are also crucial to scale up the customer base. Current trends allow adults to use their free time more productively. They often look to technology to participate in things they enjoy. All of these sectors are growing in India, bringing growth and revenue. Some examples include:

• Streamlining movies and series to our electronic devices to watch at our convenience.
• Watching and keeping up with scores on major sporting events around the world.
• Exploring interesting ideas, like sites that explain the chances of winning a lottery jackpot or what to do when you come into money. 
• Expanding career opportunities with online learning and training to better their financial portfolios.
• Building and maintaining personal and professional relationships.

Investment growth

The Indian PE/VC market was buzzing with frenetic deal activity. An estimated $70 billion in investments were invested in the country in 2021. These investments are bolstered by supportive government policies, skilled professionals, and high-quality infrastructure.

Among the most important deals were those in IT/ITES and telecom. The industry expects smartphone users to increase from 150 million in 2016 to 500 million by 2020.

Telecom

Despite the fact that the telecom industry has grown immensely over the years, it still has to face some severe challenges. The most important is to ensure that the sector gets the right mix of policies to make it more attractive to investors.

The data business is expected to fuel the industry's growth in the next five to ten years. Telecommunications companies believe that it could be the next big source of revenue. However, there are many pieces that need to fall into place for it to become a big deal.

Photo credit: Shashank Hudkar

Capital markets

Despite political turmoil in the United States and China, India has been a hotspot for investments. The country's massive consumer market and stable economy make it an attractive business target. Moreover, its technological innovations and advanced management practices are attracting more investors. This usually means more sources of employment and a better economy for the area.

Technology is one of the biggest drivers of India's economy. For instance, in the health sector, India's medical sector has experienced a significant boost in the past few years. 

Additionally, the e-Choupal system has allowed farmers to order agricultural inputs and negotiate procurement. In addition, distributed ledger technology can reduce operational costs and system risk.

A large and healthy middle class

During the past two decades, the number of middle-class households has soared. However, this growth has only benefited some citizens.

Many people in the middle class are experiencing pressures caused by rising costs for education, housing, and health care. This could limit the ability of governments to meet the demands of a growing urban middle class.

Despite the growth in the middle class, India is still a nation with a large unmet need for essential services. The country is working to improve its investment climate and accelerate job creation. In addition, India has launched a number of reforms designed to encourage foreign investment.

Aging infrastructure

Developing economies have to build new networks to sustain economic growth. These include transportation, water, energy, communication, and social and healthcare networks. This is a daunting task, but it is also an opportunity.

Infrastructure is a complex topic and can be a difficult proposition to finance. However, recent studies have shown that the public and private sectors are catching on to redeveloping and maintaining existing infrastructure.

A recently released report by Citi highlights key themes and suggests opportunities for both the public and private sectors. The report identifies the most significant technology, innovation, and process improvements that could help improve infrastructure.

Lack of digital skills

Despite a considerable appeal to potential investors, India's manufacturing sector has laggardly lagged behind China's. Further reforms will help to make manufacturing more competitive. In addition, manufacturers can use the local market to create value-creating businesses.

Conclusion.

To realize the country's promise, new service provisions, governance, and procurement approaches must be adopted. The private sector will play a significant role in the success of the nation. 

However, policymakers still need to encourage innovative social programs and job creation. Moreover, the government must promote the agenda of growth-oriented investment and farm-sector productivity.