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Domestic Investments

August, 2012


The Indian economy has continuously recorded high growth rates and has become an attractive destination for investments, according to Ms Pratibha Patil, the President of India.

India is projected to see a faster growth of 7.5 per cent this fiscal, on the back of higher savings and investment rates, even as most of the Asia-Pacific economies are likely to expand at a slower pace, as per a United Nations (UN) report.

India is emerging as one of the world's key markets for hybrid and electric medium-heavy-duty trucks and buses. A new analysis from Frost & Sullivan Strategic Analysis of Medium- to Heavy-duty Hybrid and Electric Commercial Vehicle Market in China and India, highlights that component revenues from India will reach US$ 212 million by 2020, accounting for 11 percent of the global component market.

The micro, small and medium enterprises (MSME) sector in India has grown at an annual rate of about 5 per cent, in terms of investment, the sector has grown by 10 per cent and the accompanying employment in the sector has also increased, as per Aisha de Sequeira, Managing Director, Morgan Stanley and head of its investment banking in India. Sequeira further pointed that the contribution to the gross domestic product (GDP) of small and medium enterprises (SMEs) is expected to be 22 per cent by the end of 2012.

Investment options in India

  • India's domestic IT spend is valued at US$ 30.4 billion, out of which Banking, Financial Services and Insurance (BFSI) sector contributes to 11.1 per cent, as per a study conducted by advisory firm, Zinnov. The IT spend in BFSI vertical is expected to reach US$ 3.5 billion by FY 2014, growing at a compound annual growth rate (CAGR) of 13 per cent, as per a company release
  • The Indian nutraceutical market has earned revenues worth US$ 1,480 million in 2011 and is expected to grow to US$ 2,731 million in 2016, at a CAGR of 13 per cent, as per new analysis from Frost & Sullivan
  • Indian financial services industry plans to spend Rs 37,700 crore (US$ 6.78 billion) on IT products and services in 2012, an increase of 17.4 per cent over 2011. The forecast includes spending by insurers on internal IT (including personnel), hardware, software, external IT services and telecommunications, according to Gartner. Moreover, the telecommunication equipments and services represent the biggest spending category, and it is forecast to reach Rs 13,100 crore (US$ 2.36 billion) in 2012, up from Rs 11,300 crore (US$ 2.03 billion) in 2011, it highlighted
  • The Indian clinical research market is set to more than double to cross US$ 1 billion by 2016, according to a report by Frost & Sullivan. The local US$ 485 million clinical research market is growing at 11-13 per cent, as per the report
  • International cash and carry chains in the retail sector plan to expand in India. Walmart, the US$ 446 billion American retail giant, which operates cash and carry outlets in India in a 50-50 joint venture (JV) with the Bharti Group, expects to open 12 to 15 wholesale outlets in 2012. Cash and carry represents an opportunity worth around US$ 150 billion of the US$ 500 billion annual retail business in India
  • Spice Board of India plans to promote exports of spices by establishing 25-30 spice parks in different parts of the country. This will help in achieving export of spices worth Rs 30,000 crore (US$ 5.40 billion) by 2020, as per Dr G K Vidyashankar, Deputy Director (Marketing), Spices Board. These parks would give a common platform for farmers, traders and exporters


  • Sahara India plans to enter the retail sector and will invest Rs 3,000 crore (US$ 539.57 million) initially to set up the business, which will be launched in 60 towns and cities across five states on August 15, 2012
  • Adani Kandla Bulk Terminal Pvt Ltd has signed a concession agreement with the Kandla Port Trust to set up a dry bulk terminal at the Kandla Port on build, operate, transfer (BOT) basis. The project, estimated to cost Rs 1,200 crore (US$ 215.83 million), is expected to be completed in 24 months
  • Hero MotoCorp Ltd plans to invest Rs 2,575 crore (US$ 463.13 million) to set up two new manufacturing plants in Gujarat and Rajasthan and a new research and development (R&D) centre by 2013-14 Besco Ltd's foundry division unveiled their advanced wagon manufacturing unit at Baruipur, West Bengal. It is spread over about 14 acres with annual production capacity of 3,000 wagons. The total outlay is estimated to have be Rs 120 crore (US$ 21.58 million)
  • Bharat Heavy Electricals Ltd (BHEL) has completed two units of 250 megawatt (MW) each for Uttar Pradesh Rajya Vidyut Utpadan Nigam Ltd (UPRVUNL)