High barriers to entry, a seemingly endless list of licences, and an often- lengthy decision-making process: Eileen Keribar offers an insight into the practicalities and pitfalls of developing hotel projects in India.
Helping Handovers A guide to doing business in India
corners of the earth, particularly in the hotel sector. While each venture offers the prospect of growth and exposure to a new market, it is often difficult to determine whether they are in fact sound business opportunities. With its vitality, sustained growth, and
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a consummate vibrancy, India certainly represents this sentiment. While global corporations have long spotted its potential, opening offices and establishing relationships, smaller, younger, and more opportunistic firms have only begun courting business prospects in India’s major
n today’s competitive market, design and construction companies are increasingly finding themselves contemplating work in farther-flung
cities over the last decade. Whatever a company’s expertise, approaching a project in India is more complex, more challenging, yet often more rewarding, than in any other market in the world. The opportunities in India are undeniable.
Statistics reveal the incredible growth rate of the country’s GDP, the fact that it is second only to China in foreign direct investment, and, more importantly for the hospitality industry, that tourism is a steadily growing market with 650 million domestic travellers and 5 million international travellers. When compared to China’s 50+ million international visitors, one can immediately see the growth potential. What’s more, in 2009 and 2010, 14,000 branded hotel rooms were added to the Indian market with at
least as many slated in the coming year(1) .
Despite these figures, it is expected that new supply will be quickly absorbed. An important takeaway of this steady
stream of development is that developers will increasingly seek to differentiate their products – looking for the designers, consultants and management companies that can help them do so. When it comes to the relative ease of doing business in India, this picture begins to become grounded in harsh realities. According to IFC’s Doing Business Report(2)
India ranks 134th out of 183 countries with respect to the overall ease of doing business. It also ranks 177th on dealing with construction permits and 182nd on enforcing contracts.
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