Swedish companies to increase investments in India despite dampening of business sentiment

The business sentiment of Swedish companies operating here has dampened over last year.
Around half of 141 Swedish companies said the current business climate in India is very favourable, compared with 60% last year. “There was unbridled optimism after the general elections. However, now the reality has sunk in that it’s going to take some time for the reforms to show results,” said Kandarp Singh, MD of South Asian markets at Swedish packaging giant, Tetra Pak.
Kamal Bali, MD of Volvo India said that GST could be a game changer for the country in terms of increasing efficiency for businesses operating in India. Echoing his sentiment, there was an almost unanimous clamour for Goods and Services Tax Bill (GST) from several Swedish companies including Ikea, Tetra Pak and H&M, at the launch of the Business Climate Survey 2015/16 in the Capital on Friday.
“We want to look at India as one market. There needs to be an alignment across states. ‘One India’ can ease the process of doing business significantly,” said Juvencio Maeztu, CEO of Ikea India.
However, despite a fall in sentiments, eight out of 10 companies said they will continue to increase their investments in the coming three years. Around 72% of the companies perceive a favourable investment climate for the coming three years (compared to 90% in 2014/15, 51% in 2013 and 25% in 2012).
“We are working to make India one of the top destinations in the world in terms of ease of doing business. Foreign Direct Investment (FDI) in India has grown by 40% over the last 15 months,” said Amitabh Kant, secretary, Department of Industrial Policy and Promotion (DIPP). “This is the right time to invest here, ahead of the curve because in the future, competition will increase so much that companies will find it difficult to secure resources such as land.”