SECTOR PROFILE

WHY INDIA?01

CHAMPION SECTORS02

PROFILE03

INVESTMENT OPPORTUNITIES04

BUSINESS & REGULATORYENVIRONMENT IN INDIA

05

WHY INDIA?01

ADVANTAGE INDIA

Worlds largest democracy with

1.3 billionpeople

Expertise acrossa spectrum of

services

Largecompetitively-priced skilled

talent pool

Large andgrowing domestic

consumermarket

Demonstratedcapability to deliver

high-quality,cost-effective

solutions

Integrated taxstructure

Enablingbusiness

environment

Focus oninfrastructuredevelopment

Access totechnology

INDIA - A FAVORED INVESTMENT DESTINATION

Fastestgrowing major economy in the world in 2018 and 2019

6th largest economy in the world by nominal GDP and 3rd largest economy globally by PPP

1st rankglobally in inward greenfield FDI inflows in 2016

India ranks 8thin global services exports accounting for 3.4% ofworld trade incommercialservices

Services,

57%

Automobile, 5%

Pharma, 4%

Power, 4%

Others,

26%

Chemicals, 4%

Agriculture17%

Industry22%

Services61%

6.1

60.1Mauritius, 34%

Singapore, 17%

Japan, 8%

UK, 7%

USA, 6%

Netherlands, 6%

Others,22%

India’s GDP is likely to touch US$ 5 trillion by 2025

2.6

4.7

2017 2023

GDP in current prices (US$ Trillion) GVA share of sectors in Fy18

43.2

163.1

27.8

95.7

2004-05 2016-17

Exports

Imports

Services Trade (US$ Billion)

14%

10%

1%

1%74%

Category-wise Services Export (2016-17, % share)

17%

15%

1%1%

66% Travel

Transport

Insurance

G.n.i.e

Miscellaneous*

Category-wise Services Import(2016-17, % share)

Gross Foreign Inflows-FDI (US$ Billion) Top FDI source countries (% share in inflows- Apr’00 to Mar’17)

G.n.i.e- Government not included elsewhere; * includes software, business, financial and communication services

20

04

-05

20

05

-06

20

06

-07

20

07

-08

20

08

-09

20

09

-10

20

10

-11

20

11

-12

20

12

-13

20

13

-14

20

14

-15

20

15

-16

20

16

-17

Sector-wise FDI inflows (% share in inflows-Apr ‘00 to Mar’17)

75

60

45

30

15

0

Source: IMF, FDi intelligence report 2017, RBI, WTO

GROWTH ENABLERS

Growing domestic consumer base Large, young human capital base

Rising disposable income and urbanization More than 800 million people under the age of 34 years

Urb

an p

op

ula

tio

n (%

of

tota

l)

Pe

r-c

ap

ita I

nc

om

e (

INR

)

18,523

61,855

27.8

31.270000

60000

50000

40000

30000

20000

10000

0

32.0

31.0

30.0

29.0

28.0

27.0

26.0

2001 2011

Urban Population and Per-capita Income

Per capita income Urban population

Per-capita Income data pertains to 2001-02 and 2011-12Source: Census 2011, MOSPI

Size of the workforce (millions)*

37

35

27

1400

1200

1000

800

600

400

200

0

Korea Thailand Japan US Europe China India

2015 2025 (Projected) 2050 (Projected)

49

47

36 77

71

55

213

217

235

492

466

405

1008

984

795 860

985

1145

* Population aged 15-64 yearsSource: United Nations population statistics

CHAMPIONSECTORS

02

Transport

& Logistics Healthcare Accounting

& Finance

Construction

& Related

Engineering

Services

Media &

Entertainment

Education

Services Financial

Services

Environmental

Services

Tourism

& Hospitality

IT & ITeS Legal

Services

Communication

Services

((( (((

INVESTMENT ANNOUNCEMENTS

• In 2016, The Chan Zuckerberg Initiative, the philanthropic body launched by Facebook CEO Mark Zuckerberg, invested USD 50 million in Byju’s, an Indian education-tech startup.

• In 2016, Byju’s Classes’ Think and Learn Pvt. Ltd. secured two deals worth USD 125 million from Sequoia Capital, Times Internet Ltd. and others.

• In 2017, private equity investor KKR has invested around USD 97.1 million in coaching firm Resonance Eduventures Ltd.

• Helion Venture Partners, a USD 605 million Venture Capital firm based in India, invested USD 10 million in Toppr, the online test preparation platform.

• Lightbox, a USD 100 million Venture Capital firm based in Mumbai, is helping in building Indian Tech companies. It has invested in startups like Embibe, one of the most popular EdTech companies.

• In 2017, Dabur India Ltd. opened a skill development centre for women in Dhekidol village in the state of Assam that will provide rural women with improved employment and self-employment opportunities.

Source: Media reports

PROFILE:EDUCATIONSERVICES

03

EDUCATION SERVICES IN INDIA

• The education industry in India is estimated to reach USD 144 billion by 2020 from USD 97.8 billion in 2016.

• India has become the 2nd largest market for e-learning after the US.

• Approximately 28.1% of India’s population is in the age group of 0-14 years. This provides a good opportunity for growth in the Education sector.

Source: India Brand Equity Foundation (IBEF)

BASIC INSTITUTION INFRASTRUCTURE IN TERTIARY EDUCATION IN INDIA

Source: Ministry of Human Resource Development (Government of India), OECD, World Bank and All India Survey on Higher Education (AISHE, 2018).

667 723 760 799 864

30.1

32.3 33.3

34.6 35.7

0

200

400

600

800

1000

26

28

30

32

34

36

38

2012-13 2013-14 2014-15 2015-16 2016-17

Year

No. of Universities and Enrolment

No. of Universities Enrollment

61.5

54.3

49.2

0.6

0.6

0.6

0.58

0.6

0.62

0.64

0

20

40

60

80

2012 2013 2014

Government expenditure per student (as % of GDP per capita)and revenue expenditure (as % of GDP)

Government expenditure per student (% of GDP per capita)

Revenue expenditure (% of GDP)

21.5

23

23.6

24.5

25.2

19

20

21

22

23

24

25

26

2012-13 2013-14 2014-15 2015-16 2016-17

Year

Gross Enrolment Ratio (in %)

23

24

23

22.5

23

23.5

24

24.5

2012 2013 2014

Year

Pupil - Teacher ratio (in %)

Pupil - Teacher ratio

En

rollm

en

t (in

mill

ion

)

No

. o

f U

niv

ers

itie

s

Gro

ss E

nro

llment

Ratio

(in

%)

Go

vt.

exp

en

ditu

re p

er

stu

den

t(%

of

GD

P p

er

cap

ita)

Reve

nu

e e

xp

en

ditu

re (%

GD

P)

Pupil

-Teach

er

ratio

(in

%)

INBOUND MOBILE TERTIARY STUDENTS TO INDIA AND FOREIGN EXCHANGE (FOREX) EARNINGS (TOP 10, PER YEAR IN 2011-15)

Students abroad: Total number of mobile students abroad : 278,383

Students hosted: Total number of mobile students hosted: 44,766

9,144

4,404

2,756

2,088 1,896 1,479

1,459

1,236 1,185 1,116

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

Nepal Afghanistan Bhutan Nigeria Malaysia United ArabEmirates

Iran, IslamicRep.

Yemen Sri Lanka Iraq

Average Inbound mobile tertiary students - Top 10 source countries

Inb

ou

nd

stu

den

ts

Source : UNESCO (http://uis.unesco.org/en/uis-student-flow)

In volume terms, India attracts highest

number of students from Nepal, followed by

Afghanistan and Bhutan.

TOP TEN INDIAN UNIVERSITIES IN TERMS OF FOREIGN STUDENTS’ ENROLLMENT (AS PER NIRF SCORECARD)

Source : NIRF

1 Manipal Academy of Higher Education Karnataka 1834

2 Amity University Uttar Pradesh 1212

3 Symbiosis International University Maharashtra 881

4 S.R.M. Institute of Science and Technology Tamil Nadu 609

5 Vellore Institute of Technology Tamil Nadu 598

6 National Institute of Technology Tiruchirappalli 510

7 Aligarh Muslim University Uttar Pradesh 506

8 National Institute of Technology Warangal 504

9 Anna University Tamil Nadu 494

10 Bharati Vidyapeeth Maharashtra 470

S.No Institutes State Total Number of Foreign students

as per NIRF scorecard

IMPORTANT OBSERVATIONS ABOUT EDUCATION SERVICES IN INDIA

• Ministry of Human Resource Development is actively encouraging foreign students to come to India for higher education. A portal has been launched recently by the Government of India to connect international students with Indian institutions. The website url is www.studyinindia.gov.in.

• In order to promote exports in education services, network, advertisement, internationally recognized accreditation, and periodic revision of pedagogy are important considerations in attracting foreign students to India.

INVESTMENTOPPORTUNITIES

04

WHY INVEST IN EDUCATION SECTOR?

• India is in a demographic sweet spot, with a population of about 500 million in the age bracket of 5 to 24 years (IBEF, 2018). This demands huge investment in education services.

• Education infrastructure is a necessity good. There exists stable demand for education services. Therefore, investment in education is likely to offer higher returns.

INVESTMENT AVENUES IN EDUCATION SERVICES

• Online platforms for learning are gaining popularity due to increasing internet penetration. This is an important avenue for investment in the education sector.

• Vocational training institutions contribute to human-capital development in the country. Investment in such institutions will augment the development process.

• India’s relative advantages lie in Bachelor’s degree programmes and in Engineering and Science/Technology stream. Further investment in the tertiary education can attract greater foreign students to India.

• India also posits an advantage in various traditional medicine related research and development courses as well as Hindi and Sanskrit programmes. Investment in increasing popularity of such courses seems to be an important growth driver for India’s education sector.

BUSINESS &REGULATORY ENVIRONMENTIN INDIA

05

REFORMS FOCUS

Fiscalprudence andaccountability

Integratedtax

regime

Enabling Ecosystem

Servicespush

Job creation and inclusive

growth

REGULATORY ENVIRONMENT - INDIA

Foreign Investment Framework

• Governed by Foreign Exchange Management Act, 1999

• Progressive liberalization in the policies

• Automatic route (No prior approval requirement) such as railway and road infrastructure

• Approval route (Prior government approval required before setup) such as multi brand retail trading

Foreign Direct Investment (FDI) in India

Evolution of foreign investment regulations

FDI INVESTMENT ROUTE

Under Automatic Route Prior Approval Route

No requirement of any prior regulatory approval

Filing an intimation with RBI in prescribed format within 30

days of investment

Filing particulars of issue of shares within 30 days of issue

of shares to foreign investors

Filing an intimation with RBI in prescribed format within 30

days of investment

Filing particulars of issue of shares within 30 days of issue

of shares to foreign investors

Required approval from Govt. of India – Considered by respective Administrative Ministry/Department.

BUSINESS PRESENCE IN INDIA - FORM OF ENTITIES

Establishes local presence

Operates as a foreign company

Foreign Company

Liaison Office Project Office Branch Office Joint Ventures Limited Liability Partnership

Wholly Owned Subsidiary

Key considerations for choosing

investment vehicles

• Commercial considerations

• Regulatory framework (prior approval requirements for Chinese companies)

• Tax considerations

• Cost of operations{

This Report has been prepared by CII.

IT & ITES