5 Outlook
With the recent relaxation in Foreign Direct Investment (FDI) guidelines for India¡¯s real estate sector, the Government has
now permitted 100% FDI under the automatic route in completed projects for the operation and management of business
centres. This easing of investment restrictions is likely to help in the monetisation of completed commercial assets, increasing
liquidity for most developers in the country. This is a tremendous opportunity for foreign investors, and in the long run can
significantly boost the share of foreign capital in India¡¯s real estate sector.
The India office market has witnessed a recovery on the back of an improving domestic and US economy; and the country
has remained the preferred destination for the corporate occupiers in the IT-Business Process Management industry and
the nascent but growing e-Commerce segment. Demand for quality commercial space will be supported by new global
corporate office occupiers setting up operations in the country as they continue to off-shore and send knowledge/product
based work to India.
India remains an excellent business delivery centre for the IT-BPM industry; the weakening of the Indian Rupee and increased
operational efficiency have ensured the country¡¯s positioning as the world¡¯s most cost competitive sourcing destination.
Even Tier I cities in India such as Bangalore continue to be about 8-10 times significantly cheaper than other low-cost
destinations such as China, Philippines, certain Eastern European Countries, etc.
To offer additional value-cost to Clients, the India IT-BPM players are continuously looking out for lower cost destinations
within the country (Kochi, Indore, etc.) to move certain operations such as IS outsourcing, testing, customer interaction,
etc. thus providing significant cost arbitrage. While challenges around economic volatility, protectionism, competition and
customer understanding will need to be addressed, the Indian IT-BPM industry is expected to continue to partner with
clients to enable business success in the digital era, and is set on its goal to reach revenues of US$300 billion ( 19,677
billion) by FY19/20.
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ASCENDAS india trust ANNUAL REPORT
2015/2016
