External Business Factors for Foreign Investors in India

Running head: INTERNATIONAL BUSINESS
International business
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1INTERNATIONAL BUSINESS
Executive summary
The aim of this report is to discuss about the external business factors to be faced by the foreign
investors in doing business in India. Political, economical, social and technological factors are
being identified and evaluated. There are number of negative and positive factors being
identified. In addition, the major factors of competitive advantage for India are also being
identified in this report. It is identified that India is witnessing increasing flow of foreign
investment in the country and it is estimated that it will grow further in the following years. A
few recommended steps are also being discussed in this report, which will further help India to
project a more potential business scenario for the investors.

2INTERNATIONAL BUSINESS
Table of Contents
Introduction......................................................................................................................................3
Political factors................................................................................................................................3
Economical factors..........................................................................................................................4
Social factors...................................................................................................................................4
Technological factors...................................................................................................................5
Factors for gaining competitive advantages....................................................................................5
Foreign currency and exchange influences......................................................................................6
Trade policies and barriers in India.................................................................................................6
Existing level of foreign investments..............................................................................................7
Recommendations............................................................................................................................8
Conclusion.......................................................................................................................................9
Reference.......................................................................................................................................10

3INTERNATIONAL BUSINESS
Introduction
In the current business scenario, it is becoming important for the countries to develop
their competitiveness in order to gain the major portion of the foreign direct investments. In the
current era of globalization, economy of the countries is heavily depended on the inflow of the
foreign direct investments (Fligstein and Clader 2015). However, in order to gain the
attractiveness among the investors, countries should improve their external business
environmental factors along with laws and regulations. In the recent time, one of the major
countries creating positive buzz in the global scenario is India. They are having the highest
growth of economy in the world and this is reflecting in their increasing inflow of foreign
investments.
However, in order to gain an insight of the investment scenario in India, it is important to
determine the different aspects relevant to this. This report will discuss about the external
business factors evident in the Indian scenario (Gaur, Kumar and Singh 2014). In addition,
national resources and factors important to gain competitive advantage will also be evaluated.
Trade barriers and policies will be identified and the existing level of foreign investments in the
country. In accordance to the identification of issues, a few recommended steps will also be
discussed.
Political factors
It is reported in the global economy that India scored 2 in terms of political risk. This
denotes that business organizations doing business in India will face moderate level of political
risk. In the current business scenario, moderate level of political risk is being treated as
considerable (Mitra and Schottli 2016). In addition, it is also reported that India scored -0.83 in