The Regulatory Framework for Investment in India

Abstract

The economic reforms initiated in the late eighties and early nineties in India have improved the overall investment environment through market oriented policies. India’s regulatory framework has gradually become more enabling than restricting for investors. The once formidable administrative burden has been substantially reduced since the announcement of the New Industrial Policy in 1991.  With the implementation of various reforms, India has certainly emerged as an attractive destination for private investment, both foreign as well as domestic.  However, investment remains insufficient to meet India’s massive needs. Certain factors as bureaucratic delays in business approvals, multiplicity of procedures, policy and legal constraints, structural constraints, etc. still exist which  prevent it from realizing its true potential. An investor still has to undergo a lot of time consuming and complex procedures that act as a disincentive for him. The paper will make a comprehensive review of the regulations and procedures required for an investment in India and draw out the lacuna of the present system. It will also suggest steps for improving its performance in problematic areas such that the ease of doing business in India can be enhanced.