Aaishwari Chouhan takes you through investment opportunities and incentives provided by the Government of Goa which make it an excellent investment option.
Being one of the largest economies and also a very rapidly developing nation, India is one of the best investment destinations on the global map. Strategically located, the nation has access to the vast domestic and South Asian Market. It boasts a huge and fast-developing consumer market of up to 300 million people, comprising the market for branded consumer goods and projected to be growing at 8% per annum. The demand for several consumer products is growing as high as at over 12%per annum.
In India, foreign investments from Non-Residential Indians (NRI) are always welcome. Although approval is mandatory, in the sixty categories of industries all approvals are automatically taken care of. India is also one of the largest manufacturing sectors in the world, spanning almost all areas of manufacturing activities.
A nation with such huge population with youth being in majority on the population graph, India has enough manpower. Also, with emergence of world-class business schools, training to the available manpower is no longer a very big hassle. Thus, India is one of the very few nations to provide skilled manpower and professional managers at a competitive cost. The country provides one of the largest pools of technicians, scientists, engineers, managers and trainers in the world.
The mineral base in India is quite rich with mining activities happening in several states on a large scale and on a commercial basis. The export of the ore obtained from mining is very important, in getting into the nation some much-needed foreign currency; thus making the economy stronger.
The country also has a long history of market economy, infrastructure, and boasts the sophisticated financial sector. A vibrant capital market with over 9,000 listed companies and market capitalization of US$ 154 billion (March, 1996); India is definitely much stronger on the economic aspect than it seems. Well-developed R&D infrastructure and technical and marketing services are yet another feather in our cap.
For the NRIs, policy environment provides freedom of entry, investment, location, choice of technology, production, import and export. The policies also offer a well balanced package of fiscal incentives.
A sophisticated legal and accounting system, the ease of Rupee being convertible on Current Account at market determined rate, free and full repatriation of capital, technical fees, royalty and dividends are some of the benefits offered for NRI investment in the country. Also, free use of foreign brand names, the use and acceptance of English as the corporate language here, no income tax on profits derived from export of goods and complete exemption from Customs Duty on industrial inputs and Corporate Tax Holiday for five years for 100 per cent Export Oriented units and units in Export Processing Zones are a few more add-ons from a business-investment point of view.
Also, Corporate Tax applicable to the foreign companies of a country, with which agreement for avoidance of Double Taxation exists, can be one which is lower between the rates prevailing in any one of the two countries and the treaty rate.
For Goa in particular, with a land base of 4000 sq. km. and a population of 11.7 million (Census 1991), the state offers certain incentives which include subsidy of 25% of equity up to Rs. 2.5 million for new units and expansion projects. Sales tax exemption on finished products for SSIs (15 years), medium-and large-scale units (12 years) and Income-tax deduction on 20% of profits of hotels and industrial units make the investment profit-oriented.
Loans of up to Rs. 0.5 million to selected entrepreneurs, repayable in 11 years, with 8% interest on a 5% margin is yet another offering from the state government. Rebates of 25% are also provided on commercial water-and power supply tariff for new units. NRIs can also avail 50% stamp duty exemption on bonds/mortgages in favour of state FIs/Scheduled commercial banks.
The state provides assistance of up to Rs. 2 million on a 15% margin for competent technicians/technocrats. It also grants permission for NRIs to import plant and machinery and raw materials with their own foreign Exchange. Price preference of 15% on purchases by government departments from registered units is facilitated.
Availability of sheds on a hire-purchases basis, with 10% down payment and the rest payable over 10 years is one of the most preferred state incentives. Duty free import of capital goods, components, and raw materials for 100% export-oriented units and total exemption from central excise duty and other levies for 100% export-oriented units help in generating greater returns for all NRI investments in the state.
State-identified priority sectors include Electronics, Industrial Estates, Infrastructure Development, Marine Products, Mining, Technology Products and Tourism.
The Urbanisation Ratio (1991) in Goa is 41% while the literacy rate is 77%. With around five ports, over ten industrial zones and parks and a well-connected transport system, Goa is definitely one place whose advantages and incentives every Indian would want to partake in.
