According to PwC’s analysis, the Indian market turns out to be unattractive for almost 95% of foreign investors trying to enter the Indian market and develop their business locally. News Daily India says that among the affected companies were such global giants as Motorola, McDonald’s, Coca-Cola, Nokia, Vodafone, Walmart, as well as Parimatch, a well-known gambling company that faced serious challenges in this market.
Obstacles for investors include a wide range of problems, from corruption and fraud to counterfeiting of products and copyright infringement by local competitors. In particular, Parimatch notes the problem of counterfeiting of its products and those of companies from the United States and Europe in the Indian market.
Parimatch, for example, planned large investments in the local economy, but faced a monopoly of local players in the gambling market, namely Dream11, Nazara Technologies, Paytm, First Games Moonfrog Labs, 99Games, Octro, JetSynthesys, and HashCube. They falsified the products of world-famous gambling companies, and this did not meet with a proper response from the authorities.
Against the backdrop of these problems, foreign capital is becoming less and less interested in investing in India. Besides, non-residents often face regulatory and bureaucratic hurdles, infrastructural constraints, cultural and language barriers, and strong competition from local businesses. In addition, foreign companies feel harassed and under legal pressure, even if they have never worked in India but only planned to invest in the region.
These issues are prompting most foreign investors to leave the Indian market or reconsider their strategies in this country. In particular, companies such as Ford, Holcim, and Metro were forced to exit India, and the American investment company Berkshire Hathaway sold its shares in the Indian company Paytm, thus highlighting the loss of confidence in the Indian market.
Due to these challenges, Parimatch, along with other international investors, faces a difficult choice: to continue to fight the growing obstacles in India or to look for better opportunities to grow its business outside this subcontinent.
News Daily India reports that the unsatisfactory business climate underscores the critical need for the Indian government to implement reforms and improve the business environment if the country is to remain attractive to foreign investment and maintain its potential as an important global economic player.
If the situation does not change radically, international companies, including Parimatch, which have numerous obstacles in the Indian market, will have to focus on finding more open and liberal markets, where the legal system and government structures support foreign businesses rather than create multiple obstacles for them.