Challenges Doing Business in India Essay

Trade barriers be created to encourage domestic players by make it more than difficult for foreign firms to compete. Traditionally, India has had some(prenominal) types of mickle hurdles for foreign exporters, such as, Import Quotas, Subsidies, Trade Samples and Tariff/Duty. The most critical barrier to trade is tariffs or the tax imposed on imports. High tariffs in some(prenominal) sectors continue to bar foreign businesses from increased market introduction.Red-tapism and CorruptionTraditionally, Indian bureaucracy has been mired in red tape which proved to be a frustrating experience for foreign investors. These include limited access to Government offices, cumbersome and multitude paperwork, lack of coordination between various departments bear upon the documentation, commodious waiting period for approvals, and above all ambiguous rules. However, with the scotch reforms of early 1990s, the level of bureaucratic hurdles which the MNCs had to overcome, gradually reduced making it easier to do business. Corruption is another big hurdle when doing business in India. Areas like electricity supply, judiciary (particularly lower courts), Police, land administration are counted in the most corrupt category. Since all these are essential in building up a business, corruption proves to be a study hurdle for starting business in India.Inadequate InfrastructureIt has long been felt that roads and communication in India need substantial enthronisation in order to make them world class. Problems with the countrys upbringing and power situation are also counted amongst the toughest obstacles for doing business. Today, there is an increased backstage participation in ports, roads and other key sectors. Infrastructure information has emerged as a niche market for foreign investors in India with several states looking to build world class groundwork. The problem area is the absence seizure of a clear-cut policy framework, which has hampered private investme nt in the infrastructure sector.