India has a very large domestic market, and resilient private consumption is a major driver of economic growth. A vast supply of inexpensive but skilled labour has turned India into the back office of the world. Despite numerous problems, India has generally managed to avoid hard authoritarian rule or military coups, which have happened in many other developing countries, including India’s neighbours, Bangladesh, Myanmar and Pakistan.

We keep our clients informed of the latest market moves and political developments as part of our 'top-down' and 'bottom-up' perspective. Clients also benefit from in-depth analysis on 24 of India’s most important industries. We provide interactive data and forecasting alongside detailed and risk-assessed analysis from our expert teams. We aim to keep you one step ahead, so you can do business with ease in India.

Country Risk

India Country Risk

BMI View:

Indian Government To Continue Improving Business Environment

Core Views

  • The Indian government led by the Bharatiya Janata Party has initiated various reforms in its first two years in office, and it will continue to enact incremental rather than big bang reforms over the coming years. That said, the lack of majority in the Rajya Sabha, India's 245-seat upper house, will remain a hurdle to the implementation of large-scale reforms. State elections, which will continue to take place over the coming years, will determine whether the BJP will attain an upper house majority.

  • We remain broadly constructive on the Indian economy, and it will become the fastest growing major economy in Asia owing to the government's pro-business initiatives and accommodative monetary policy by the central bank. We expect the country...

India Operational Risk Coverage (9)

India Operational Risk

BMI View:

BMI View: India's appeal for investors lies in its vast market and growth potential, with the country benefitting from significant natural resources and an expanding manufacturing base, supported by a huge working age population and extensive transport connections. The opportunities offered by these advantages are accompanied by some significant risks, however, including a high terrorist threat, widespread corruption, excessive bureaucracy and weak utilities infrastructure, all of which increase the costs and obstacles of operating in India. Consequently, the country remains a difficult place to do businesses, reflected in an overall score of 47.1 out of 100 in the BMI Operational Risk Index, which places India in a middling 19th position out of 35 states in the Asia region and 111th...

India Crime & Security

BMI View:

Despite boasting Asia's third largest economy and second biggest military, India suffers from high levels of crime and security risk and the country poses moderate security risks for foreign business travellers, expatriates, and tourists. The country faces persistent terrorist risks and experiences elevated levels of petty crime and female sexual assault. Furthermore, foreign governments advise their citizens to avoid certain areas due to instability. India is a regional underperformer in the BMI Crime And Security Index, in 24th place out of 29 Asian countries with a score of 25.8 out of 100. Neighbouring states rank as follows: China (17th), Sri Lanka (19th), Nepal (21st) and Pakistan (29th).

India is a relatively safe place for business assets in terms of property crime, with only a small number of investors citing crime and theft as a major impediment to doing business. Pick-pocketing is one of the most commonly...

India Labour Market

BMI View:

BMI View: India's labour market offers many potential benefits for prospective investors. As one of the most populated countries in the world, the labour market is immense and further benefits from a low minimum wage and relatively few labour market restrictions. There are also, however, considerable risks such as the weak quality of education which suffers from large regional disparities and limited female participation in both education and the labour force. Overall therefore India is a regional underperformer on the BMI Labour Market Risk Index with a score of 47.9 out of 100 placing the country 23rd out 38 Asian states.


India Logistics

BMI View:

India, despite its considerable size and population, remains something of a sleeping giant in terms of its international trade potential and the overall value of its supply chain. While India's l economy has become increasingly liberalised over the past few years, the country's trade and logistics sectors remain hamstrung by a combination of mediocre transport infrastructure and high levels of bureaucracy and red tape. A poor utilities framework, both in terms of power generation and the availability and fuel and water are further impediments to an effective supply chain. Despite ongoing challenges, in the past few years there have been signs that the Indian government is beginning to address these inefficiencies and is channelling increased resources into modernising the country's transport and utilities framework. This improvement explains India's position in the top half of BMI's Asia Logistics Risk Index. The country places 14 th...

India Trade & Investment

BMI View:

BMI View: India offers enormous potential as an investment destination. The country's huge and diverse economy boasts among the highest trade volumes globally, and strong growth is expected over the medium term. The government is committed to attracting further foreign direct investment (FDI), and reforms and incentives are gradually removing some significant barriers to foreign entry. Nevertheless, there remain considerable risks to be considered, notably the entrenched culture of corruption, substantial trade barriers, and extensive bureaucratic hurdles, which impact upon most businesses sectors. Diverse policies and regulations implemented by different states further complicate the process of operating across the country, and will require extensive research and forward planning to navigate successfully. Overall India therefore has a score of 48.3 out of 100 on the BMI ...

India Industry Coverage (31)


India Agribusiness

BMI View:

BMI View: We hold a positive view on the outlook for India's agribusiness sector, as the country will remain an agricultural powerhouse and should be able to maintain high levels of self-sufficiency for major food crops. Production growth of various commodities will be driven by strong government support and robust demand growth for manufactured foodstuff. We see significant growth opportunities in sub-sectors such as dairy, coffee and livestock. However, India will be increasingly vulnerable to exceptional weather phenomena and serious water shortages. Moreover, the country will remain prone to erratic government interventions, which seriously hamper its reputation as an international provider.



India Autos

BMI View:

BMI View: We believe that a combination of positive demographic trends and solid economic growth should lead to another positive year for the Indian new vehicle sales market in 2016. We are targeting 6.1% sales growth for the sector as a whole, with commercial vehicles set to outperform passenger cars.

Passenger Car and Light Commercial Vehicle Sales
f = BMI forecast. Source: SIAM, BMI
Key Views
  • Commercial vehicles are outperforming...

Commercial Banking

India Commercial Banking

BMI View:

Commercial Banking Sector Indicators
Date Total assets Client loans Bond portfolio Other Liabilities and capital Capital Client deposits

Consumer Electronics

India Consumer Electronics

BMI View:

BMI View : India trails much of APAC in terms of device penetration rates and household incomes - but with our Country Risk team's positive outlook for household income, we expect the market to exhibit robust medium-term growth at a CAGR of 6.3% over 2015-2019. We expect to see more than 50mn additional Indian households gain the purchasing power to be full consumer electronics market participants over the medium term, supplementing existing replacement demand from the large premium segment. Meanwhile, increased local device manufacturing, fostered by the 'Ma...

Defence & Security

India Defence & Security

BMI View:

BMI View: We believe that India's defence ambitions will continue to face challenges over 2015. That said, the increase of the foreign investment cap to 49% from 26% should boost the defence industrial base.   India's security risk is   medium given India's issues with transborder and domestic terrorist groups and particularly in light of the growing prevalence of international terrorism.  BMI highlights the corruption probe into the VVIP helicopter deal has the potential to complicate further...

Food & Drink

India Food & Drink

BMI View:

BMI View: Over the long-term, India offers one of the most attractive consumer bases globally, benefitting from a large and young population, rapid urbanisation and rising incomes. This will drive consumption of processed food, as well as soft and alcoholic beverages. Nevertheless, severe operating and regulatory challenges remain, hampering industry dynamism and limiting investment in some sectors such as mass grocery retail.

Headline Industry Forecasts (local currency)

  • 2015 food consumption growth = +7.0%; compound annual growth rate (CAGR) 2014-2019 = +7.0%.

  • 2015 alcoholic drink value sales growth = +13.5%; CAGR 2014 to 2019 = +12.3%.

  • 2015 soft drink value sales growth = +17.2%; CAGR 2014 to 2019 = +15.6%.

  • 2015 mass grocery retail...

Freight Transport

India Freight Transport

BMI View:

BMI View: We expect positive growth across the board in India's freight transport sector in 2015 (ending March 2016) and over the medium term. However, the growth will not be even, with the anticipated expansion in air freight especially to outperform, while road freight - where growth will be tempered in the near term by a gloomy outlook for agricultural produce - will lag.

According to our forecasts, Indian trade will see moderate growth in real terms in 2015 (ending March 2016), rising by 1.8% - although this is an improvement on the real contraction recorded the previous year. Growth will accelerate in 2016, rising to 2.7%. Exports will be the key driver of growth in both years - in 2015 exports will rise by 2.5% compared to imports' 1.0%, while in the following year the growth levels will be 3.5% and 1.8% respectively. In...

Information Technology

India Information Technology

BMI View:

BMI View: India's IT market is a regional laggard, as low incomes have stymied PC market development, leaving it far behind China, a situation that is similar in terms of enterprise IT spending. The medium-term outlook is however much improved compared to the past decade, with our household income growth forecast illustrating the potential for retail hardware vendors to capitalise on a massive deepening of the market as disposable incomes for around 50mn households pass our threshold for PC market participation. This must however be considered in the context of a high degree of price sensitivity - as well as a greater level of competition from other device categories than when East Asian economies passed through similar developmental stages. We also believe there to be the foundations for enterprise...


India Infrastructure

BMI View:

BMI View: Our forecast for India's construction industry remains positive as the government continues to promote ambitious expansion across all sectors, backed by policy reform. Manufacturing, transport, energy and real estate will be key areas of growth throughout our forecast period, given their importance in boosting overall economic growth. Persistent regulatory challenges - including high levels of bureaucracy and the complex web of administrative bodies - will act as a deterrent to potential investors given the risks to project execution and exposure to corrupt practice.

Latest Updates & Structural Trends

  • India's construction industry will record steady growth over the next 10...


India Insurance

BMI View:

BMI View: India's insurance market will continue to expand at a fast pace over the forecast period as a favourable economic climate and rapidly growing middle class demographic driver sales of life insurance, health covers and other insurance products. The market will nevertheless remain very underdeveloped in terms of both density and penetration. Following the easing of regulations surrounding foreign ownership of Indian insurance companies, multinational insurers will play an increasing role in the industry's development.

Headline Insurance Forecasts (India 2012-2019)
2012 2013 ...

Medical Devices

India Medical Devices

BMI View:

BMI View : The Indian medical device market has entered a phase of more moderate growth. The market will still outperform within the Asia Pacific region, underpinned by a strong economy, but y-o-y growth rates will be a long way off the dynamic growth achieved up until 2012, reflecting an increasingly competitive operating environment and increasing market share for lower cost domestically produced products in some areas. The expanding private sector will remain the main growth driver.

Projected Medical Device Market, 2014-2019
Total (USDmn) Per Capita (USD) ...


India Metals

BMI View:

BMI View: Tin prices will be capped by US dollar strength in 2016, leading us to trim our price forecast to USD14,500/tonne. Beyond 2016, prices will recover gradually as the global tin market posts sustained market deficits and inventories dwindle.

Global - Tin Supply, Demand & Price Forecasts
2014 2015e 2016f 2017f

India Metals

BMI View:

BMI view: We have revised our aluminium price forecast from USD1,575/tonne to USD1,600/tonne in 2016, as the tightening market provided an earlier than expected floor in Q116. Aluminium prices will gradually edge higher as the global market moves into a deficit by 2018.

Global - Aluminium Supply, Demand & Price Forecasts
2014 2015e 2016f 2017f

India Metals

BMI View:

BMI View: Globally, iron ore prices will remain subdued due to weak demand growth in China and expanding output by major miners in Australia and Brazil. China will see output slow as the country's iron ore miners operate on the higher end of the global iron ore cost curve.

Global Iron Ore Forecast
2014 2015e 2016f 2017f 2018f

India Metals

BMI View:

BMI View: Nickel prices will bottom in 2016 as weak production drags the global market into deficit. For instance, we expect Chinese imports of nickel to grow over the coming quarters. Prices will begin 2016 weaker than we had previously expected and we have thus revised down our 2016 average price forecast to USD9,000/tonne from USD10,500/tonne.

Global Nickel Forecasts
2013 2014 2015e

India Metals

BMI View:

BMI View: We have revised down our average copper price forecast for 2016 to USD4,900/tonne. We expect prices to find a floor over the first half of 2016, and begin to stabilise thereafter, supported by production cuts and modest consumption growth.

Global - Copper Supply, Demand & Price Forecasts
2014 2015e 2016f 2017f 2018f ...

India Metals

BMI View:

BMI View: Gold prices will prove resilient in 2016 due to a dovish shift in global monetary policy and elevated systemic financial sector risks. However, we do not foresee a sustained multi-year recovery and the mining sector will thus remain under significant stress. We forecast slowing mine production growth and increasing consolidation.

BMI Gold Forecasts
2014 2015 2016f 2017f ...

India Metals

BMI View:

BMI View: Global steel prices will remain subdued due to a persistent steel oversupply over the coming quarters. From 2017 onwards, steel prices will gradually edge higher as the global steel surplus will narrow due to Chinese supply moderation.

Steel Price Forecast
2014 2015 2016f 2017f 2018f 2019f...

India Metals

BMI View:

BMI View: We maintain our average zinc price forecast for 2016 of USD1,750/tonne. We expect zinc prices to reach a floor over the first half of 2016, and begin to stabilise thereafter, as production cuts shift the market to a deficit.

Global - Zinc Supply, Demand & Price Forecasts
2014 2015e 2016f 2017f 2018f

India Metals

BMI View:

BMI View: Lead prices will gradually edge higher as the global lead market will shift into deficit by 2017 as production growth will slow over the coming years.

BMI Lead Price Forecast
Current* 2016f 2017f 2018f 2019f 2020f


India Mining

BMI View:

BMI View: India's mining sector will experience solid growth, primarily boosted by the country's positive reforms and vast mineral reserves. Despite this, the sector will continue to face challenges due to the country's inadequate operating environment, mining royalties and low metals prices, which will prevent India from reaching its full growth potential.

India - Mining Industry Value Forecast
2015e 2016f ...

Oil & Gas

India Oil & Gas

BMI View:

BMI View: India's oil and gas production outlook is heavily bearish, with rapid decline rates and a narrow project pipeline weighing down growth. Incremental reform of the country's fiscal and regulatory regime, alongside progressive price liberalisation, offers risks to the upside. However, further reform will be needed to unlock exploration and development in the most prospective but hard-to-access areas. The outlook on the refining sector remains broadly bullish, supported by strong forecast consumption growth, supportive government policies and continued market deregulation.

Headline Forecasts (India 2014-2020)
2014e 2015e ...


India Petrochemicals

BMI View:

While India did report growth in Indian petrochemicals production in 2015, this growth was largely unspectacular, even as feedstock prices fell and profit margins grew. The long-term challenge to the industry is removing the bureaucratic obstacles to investment, which would require greater government action on land acquisition, corruption and environmental approvals.

With a soaring domestic market and growing export-led manufacturing, India has significant potential and could replace China as Asia's premier investment destination for petrochemicals. In 9M15, chemicals growth was 4.5%, up from -0.3% in 2014, while rubber and plastic rose 3.1%, up from 2.5%. Average growth in petrochemicals demand is forecast at 8% per annum over the next five years, with the polymer market...

Pharmaceuticals & Healthcare

India Pharmaceuticals & Healthcare

BMI View:

BMI View: The tough operating environment for multinational drugmakers in India will see little improvement over the medium term. Designated as a 'Priority Watch List Country' for PhRMA's Special 301 submission for 2016, the issues raised largely mirrored those touched upon in the 2015 submission, such as low levels of intellectual property and challenges in market access. As a result of these factors, innovative firms will adopt a cautious approach to India, which remains attractive due to its large medicine market size.

Headline Expenditure Projections

Pharmaceuticals: INR1,065bn (USD16bn) in 2015 to INR1,191bn (17bn) by 2016; +11.8% in local currency terms and 5.1% in US dollar terms. Forecast unchanged from last quarter.

Healthcare: INR6,695bn (...


India Power

BMI View:

BMI View: Our view that power sector reforms would be a top priority for Modi's government is playing out. We are seeing notable progress in the Indian power market regarding renewable energy expansion, reducing red tape for power projects and improving fuel availability for thermal generation. That said, investment in India's power grid infrastructure will need to increase if Prime Minister Modi's ambitious power plans are to be realised. The transmission and distribution network remains highly inefficient, posing a significant risk to the expansion of the power and renewables sector in India. R...

Real Estate

India Real Estate

BMI View:

BMI View: India has a promising outlook in terms of commercial real estate investment as the barriers previously opposing FDI have been reduced through government policy updates. With the economy growing and higher consumer spending, office and retail markets are currently being supported financially, with a knock-on effect to the industrial warehouse market as online retail is seeing growth. Rental rates are either sustained or marginally increasing due supply and demand level in most locations; however risks in the marketplace are reducing over the coming years as India looks to modernise.

Growth in India's commercial real estate market will be supported by an uptick in economic growth. GDP is forecast for 4.2% y-o-y growth in 2015 which is expected to be sustained over the next 5 year with 10.5% in 2016. Growth will be supported by regulatory improvements and an...


India Renewables

BMI View:

BMI View: Solar capacity will register the fastest growth rates over our 10-year forecast period and dominate the project pipeline. The ongoing sector and country-specific risks, such as the land acquisition bill, T&D bottlenecks and business environment hurdles threaten project realisation. Countries that have recently formed trade links with India, such as UK and US, will continue to play a key role in the competitive landscape.

India - Headline Renewables Forecasts
2015e 2016f 2017f


India Retail

BMI View:

BMI View: The Indian retail market benefits from a number of factors that will increase opportunities for retailers in the medium and long term. The size of the population is one key attribute, creating a large pool of potential customers, while the key 20-39 year old demographic is also large, creating good opportunities for retailers to establish brand loyalty among young urban dwellers who are keen for an aspirational retail experience. The main urban centres already benefit from shopping malls and Western retail outlets, and the market for luxury goods is significant.

However, most Indians are still rural dwellers, and the agriculture sector is a major employer. As agricultural incomes are typically low, and workers in the sector are affected by unstable weather patterns as well as underemployment, this limits the participation a large majority...


India Shipping

BMI View:

BMI View: We expect growth at India's biggest container ports to remain robust in 2015 and 2016 with total trade recovering from negative growth in 2014. Drivers to Indian shipping are strong economic growth sustained over the past decade which is increasing domestic consumption and therefore demand for imports, improved trade between countries using Indian ports as transhipment hubs and the country's concentration on manufacturing which is boosting export volumes. The major restrain remains congestion at facilities caused by strikes and traffic exceeding handling capacity of ports.

Over the medium term 2015-2019 we anticipate average real growth in trade at 4.23% and container throughput growth at the ports of Chennai and Jawaharlal at 4.1% and 2.6% respectively. We expect infrastructure and logistical improvements at ports enabling facilities to accommodate this growth and...


India Telecommunications

BMI View:

BMI View: While voice remains the main source of revenue at the moment, operators' strategy of migrating customers to higher-value 3G and 4G services will drive data consumption and market growth over the next five years. The towers market is another key area of growth, as operators are increasingly offloading assets to third party tower companies in order to free up the capital needed to invest in spectrum and services.

3G/4G Migration Drives Mobile Sector Expansion
India Mobile Market Forecasts


India Tourism

BMI View:

BMI View: India's tourism market will continue to grow and expand in the next five years as the number of arrivals is set to increase steadily and, simultaneously, the country's economy will increase the Indian middle and upper travelling classes. To accommodate this increase, the government is setting up policies that aim at not only improving and developing tourism infrastructure, creating new opportunities for investment, but also expanding the offers (including golf, adventure travels, spiritual travels), thus expanding tourism to more rural areas.

Key Forecasts (India 2013-2020)

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