Indians do well in the US, India’s weak and uncompetitive industries


Introduction to Business in India

Many people will react subconsciously. I don’t invest in India. Talking about what the Indian stock market and Indian companies do will not actually help me. Investors holding this view are really not very desirable; because now is the era of globalization, investing in US stocks is actually investing in countries around the world, because almost all companies in major countries around the world take US stocks market IPO as their first goal. The US stock company you may invest in may be an Indian company or a company run by Indians.

You can refer to my other article on India “India stock market and the emerging Indian tech giants“.

What is India’s national strength

Total population

India’s total population of nearly 1.4 billion will surpass that of mainland China by 2023. However, due to the rise of national power and national income in mainland China, the cost of living has risen rapidly, and the willingness of the new generation to raise children is low.

Poor quality of manpower

The literacy rate of the population aged 15 and over in India is 74%. The total population of this part is about 1.04 billion, and the number of illiterate people is about 270 million, accounting for 40% of the total illiterate population in the world.


In 2022, India’s per capita GDP will reach US$2,388.6, an increase of 27.77 times from US$83 in 1960. During the same period, the per capita GDP of the United States increased from US$3,001 to US$76,328, an increase of 24.43 times, with an average annual growth rate of 5.36%.

The world’s 5th place in GDP, the total GDP in 2020 is US$3.05 trillion (IMF data). In 2022, GDP will grow by 7.2%, surpassing the UK, and India has become the fifth largest economy in the world! The gap with Germany is not big, but it is not the same order of magnitude compared with the United States and China. Even Japan, which has the third GDP, is far behind. But India is one of the most oppressive nations in the world, and has always claimed to be the only one or two countries in the world that can confront China in all aspects.

The International Monetary Fund (IMF) predicts that India’s GDP will grow by 6.1% and 6.8% in 2023 and 2024 respectively, making it one of the fastest-growing economies in the world.

The IMF in October 2023 had a forecast covering 2028 stating that India’s economic size may surpass Japan’s in 2026. India currently has a population of 1.4 billion, surpassing mainland China to become the country with the largest population in the world. Forecasts show that Japan may further decline to the world’s fifth largest economy between 2026 and 2028, while India’s GDP is expected to become the world’s fourth largest in 2026 and rise to the world’s third largest in 2027.

Social injustice

But don’t forget that India is still a caste system country (the law belongs to the law and it’s difficult to implement). There are about 300 million people in the country who are untouchables. Living below the poverty line can only live a life like an ant, and women are in even more difficult circumstances. Some people estimate that there may be only about 100 million people in India who can have the basic human rights of people in developed countries and the right to complete education, and the elite of these people later went to the United States.

Business development is backward and uncompetitive

In addition, India’s business environment can only be described as poor, and there are still many areas that can be improved. For example, insufficient electricity, poor sanitary conditions, loose ethnicity, and low work efficiency of employees. Sadly, the government cannot keep up with the modern pace. There are nearly 40 official languages in the country. The expressways are not unified in all states, corruption and bribery are preoccupied, and bureaucracy and administrative efficiency are extremely poor.

Backward infrastructure

The development of manufacturing industry requires the cooperation of software and hardware facilities, but India is not satisfactory in various aspects such as infrastructure logistics, land acquisition and factory construction, labor quality, laws and regulations.

The entire national power system is full of complicated power plant ownership, distorted coal price system and serious environmental pollution.
It is difficult for the manufacturing industry to obtain a stable and cheap power supply. India’s railway transportation system is still in the pre-modern state of “multi-track coexistence”, with various gauges and low efficiency.

Indian economy monopolized by a small number of chaebol

Moreover, important industries are almost monopolized by a few big chaebol that have a good relationship with the government; they and the government achieve mutual success: the financial tycoons control India’s cumbersome bureaucracy through political connections, and receive numerous explicit or implicit policy support. Get a lot of loans from the banks, and finally execute the grand plans of the government.

In 2015, MKV enu, the founder of “Wired” magazine and a well-known Indian journalist, once said that about six to eight entrepreneurs who closely surrounded Modi owed banks a total of 35 trillion rupees, the total capital of the Indian banking industry at that time. Only 50 trillion rupees. If these businesses go bankrupt, 70% of the capital of India’s banking sector will be wiped out.

Indian chaebols are not competitive when they go abroad

Behind India’s rapid economic growth, it actually depends on a few oligopolistic companies. However, unlike the monopoly of big money in Japan and South Korea, their monopoly can only be in the country, and there is no competitiveness at all abroad. It is because the government deliberately protects almost all industries in the country. As a result, although it is a country with a large land and population in name, there are almost no industries that can be sold in the world.

20 conglomerates generate 80% of the profits of all Indian companies

A recent Wall Street Journal report reveals that India’s six largest chaebols now control 25% of India’s ports, 45% of cement production, 1/3 of the steel industry, nearly 60% of telecom users and more than 45% of coal imports. Six chaebols have accounted for a quarter of all new investment proposals by private companies since 2014, according to an analysis by the Indian Economic Monitoring Center.

The Indian government is deceiving oneself

A series of trade protectionist policies in India have limited the competitiveness of these chaebols. The expansion of the chaebols is at the expense of small and medium-sized enterprises. However, these private monopoly enterprise groups that consume a large amount of the country’s resources can only earn monopoly profits under the umbrella of the government. To the international market. However, the Indian government does not recognize the existence of plutocrats in its country.

Poor business environment ranking

According to the World Bank’s “World Business Environment Report 2020”, India ranked 130th in the global business environment ranking (a total of 189 economies) in 2015. By 2020, India’s global business environment ranking has risen to 63rd.

India is the graveyard of foreign businessmen

India generally does not have a good impression of foreign-funded enterprises. The government will find various excuses to increase taxes, charge various huge fees, and even frequently change laws, causing foreign investment to be disturbed. According to the Indian government, a total of 3,552 foreign-invested companies exited the Indian market from 2017 to 2022.

The Wistron labor conflict that broke out on December 12, 2020 is the epitome of foreign companies operating in India. This incident had a far-reaching impact, leading Wistron to sell all its factories in India, and even quit Apple’s foundry business. There are countless multinational companies with similar experience to Wistron. The more famous cases include Ford Motor (ticker: F), Harley-Davidson (ticker: HOG), and General Motors (ticker: GM).

The complexity of Indian tax law is probably the first in the world. In 2022, India accused Xiaomi of allegedly violating India’s “Foreign Exchange Management Law” and confiscating 4.8 billion yuan of Xiaomi’s funds. According to reports, the Indian government has even recently required Chinese mobile phone companies to appoint Indians as CEOs. This move is considered to be a disguised form of plundering Chinese companies. Xiaomi is not a special case. Pohang (ticker: PKX), Honor, vivo, OPPO, IBM, Nokia (ticker: NOR), Samsung, and Shanghai Electric also have the same experience as Xiaomi.

In 1973, India passed the “Foreign Exchange Control Act”, which stipulated that the proportion of foreign capital holdings should not exceed 40%, driving away dozens of multinational companies such as IBM in one go.

From 2014 to 2021, a total of 2,783 multinational companies in India have closed their companies or offices, accounting for one-sixth of India’s 12,000 foreign companies.

According to Forbes, Rao Inderjit Singh, India’s Minister of State for Corporate Affairs, revealed in Parliament this year that from 2018 to 2022, a total of 559 foreign-owned companies have withdrawn. India, more than the 469 companies that entered India during the same period. Only 64 foreign-funded companies will enter India to do business in 2022, the lowest number since 2018. As of March 2023, India has only welcomed one new foreign-funded enterprise.

Great gap between rich and poor

The result is a handful of people who can make the list of Asia’s richest people. But people at the bottom live in poverty, and hundreds of millions of people live below the poverty line defined by the United Nations for a long time. Moreover, the same financial group can monopolize everything from people’s livelihood to energy and telecommunications. This is the culprit of the astonishing gap between rich and poor, which has not changed in decades since independence.


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The following is an overview of the development of new innovative technologies in some important countries in my blog, or brief articles:


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