India – The Most Preferred Business Destination for Setting up a Captive

India – The Most Preferred Business Destination for Setting up a Captive


Kearney’s 2016 Global Services Location Index (GSLI) rated India as number one out of total 55 countries analyzed in three categories – financial attractiveness, people skills and availability, and business environment.

So, what makes India as one of the most preferred destinations for GICs? Let us look at the factors in some detail.

1. Cost advantage

The manpower costs are far less as compared to many other countries. Companies can save about 30% – 40% of their operational cost, thus proving to be a major attraction for organizations to set up their base in India.

2. Availability of high-end talent:

Gone are the days when the reason for setting up a base in India was only cost advantage. India has also become one of the hot beds for high-end talent on cutting edge technologies. Technology giants like Amazon, Microsoft, and Google are looking at India to tap the high-quality talent on emerging technologies like artificial intelligence, deep learning, and advanced analytics. The innovative platform developed by Amazon India, which is being replicated globally is one of the recent examples of successful products coming out of India.

3. Quality infrastructure

With over 300 million people having access to the internet, India is now the second most connected nation in the world. India scores over other countries in respect to ease of transport and better facility management.

4. Government Policies

Being a democratic government and a secular nation makes India, “The Most Open Economy in the World”. Fewer restrictions on FDI create opportunity and competitive advantage for companies. India is one of the 12 countries in the world that have adopted cyber laws. Liberalization of government regulations and strategy by Indian Government to promote infrastructure opens an opportunity for companies to expand in India. The Indian Government has also set up the Ministry of Information Technology to support the IT industry in India. Companies can be assured of ‘IP’ protection and protection against cyber-crimes.

5. Demographics and constant creation of talent

By 2020, the average age in India will be 29 and it is set to become the world’s youngest country, with 64% of its population in the working age group. Higher education in India is third largest in the world only after US and China. Every year more than 3 million students graduate from Indian universities in various fields including technology, accounting, law, and engineering. Also, English is most widely spoken all over India; this makes it easy for both internal and external communications.

With all these advantages, India makes for the perfect destination for companies looking to set up their technology offices.

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