India's Investment Appeal Shines Amid Global Uncertainty, Say Baker Tilly Executives
In a world increasingly marked by geopolitical tensions and economic volatility, India stands out as a beacon of stability and opportunity for global investors, according to senior leaders at Baker Tilly International, one of the world's premier audit and advisory networks. Francesca Lagerberg, CEO of Baker Tilly International, and Ajay Sethi, Managing Partner at Baker Tilly ASA India, emphasized in a discussion with Times Internet that India's unique combination of political stability, robust economic growth prospects, and a vast pool of educated talent positions it strongly to attract sustained foreign investment inflows.
Navigating a Volatile Global Landscape
Francesca Lagerberg described the current global environment as "incredibly volatile," with rapid shifts in technology and geopolitical conflicts creating widespread uncertainty. "No one foresaw exactly what was going to happen or when," she noted, referencing ongoing tensions. "The speed with which things have changed is quite striking. It's very hard to predict what will happen in ten days, let alone a year." This volatility, she explained, drives conversations worldwide about future risks and impacts on business operations and supply chains.
Despite this chaos, Lagerberg highlighted that stable environments are becoming increasingly attractive to investors. "Governments that provide stability, consistency of rules, and strong talent pools are always going to succeed," she stated. In this context, India's relative stability compared to many other regions makes it a compelling destination.
India's Strategic Advantages
India is very well positioned, Lagerberg asserted. "You have a growing economy, political stability, and a talented, well-educated population. People are always looking for good places to do business." She emphasized that it's not about India benefiting at the expense of other countries but about providing an attractive environment that encourages investment. "If India continues to position itself as a trusted and stable place to do business, it will become even more successful," she added, underscoring the importance of trust in an era where it has eroded in many areas.
Ajay Sethi provided insights into specific sectors drawing investor interest. He noted that Japan, the United States, France, and Germany have been significant investors, with Japan expected to remain a major player across multiple industries. Key sectors include:
- Automotive and Electric Vehicles: The automotive sector, particularly with the rise of electric vehicles, is poised for strong growth.
- Semiconductors: India is moving beyond assembly and testing into fabrication and design, with initiatives like the Micron unit and Semicon 2 attracting interest across the supply chain, including in ultra-pure water, industrial gases, and specialized logistics.
- Renewable Energy: This sector continues to be attractive, with Indian companies scaling up in areas like solar panel manufacturing.
- Consumer Goods: Investment is shifting towards manufacturing in India or expansion by domestic manufacturers.
Sethi also highlighted emerging opportunities in aerospace and defense with France, renewed interest from Korea and Germany, and untapped potential in fintech collaborations with the United Kingdom. A potential India-EU free trade agreement could further boost investment flows.
Challenges and Areas for Improvement
While optimistic, both leaders cautioned that India must address certain challenges to maximize its investment appeal. Sethi pointed to a disconnect between policy intent at the leadership level and the on-ground investor experience. "Policies may be good, but local officials can sometimes focus too much on minor procedural issues rather than the substance of the law," he explained. Improving education at the grassroots level on handling foreign investors could significantly enhance this experience.
Francesca Lagerberg emphasized the critical role of certainty and predictability. "Businesses prefer stable rules. There's nothing worse than making a major investment decision today and discovering in two years that regulatory changes have made it unviable," she said. In a world where political systems often shift, providing consistent governance is key to building trust and attracting long-term commitments.
Investment Scale and Future Outlook
Although Baker Tilly has not conducted its own study, Sethi referenced government data indicating around $81 billion in foreign investment flowed into India in 2024–25. He expressed confidence that with continued reforms in regulatory environments and labor laws, this trend could strengthen.
In conclusion, both executives affirmed that despite global uncertainties, India's stability, talent pool, and economic momentum make it a safe haven for investors. "In a chaotic world, businesses look for places where they can invest with confidence," Lagerberg said. By addressing bureaucratic hurdles and enhancing trust, India is poised to remain a top destination for global capital in the years ahead.
