By Pawan Lingayat, Vice President, SMC Capitals – Partner of Translink Corporate Finance in India
India is undergoing one of the most remarkable economic transformations of the 21st century. Already the world’s fifth-largest economy, it is on track to overtake Japan and Germany to claim third place before the decade ends. Its rapid GDP growth, youthful workforce, and far-reaching policy reforms are reshaping its role in global business – and driving a surge in cross-border mergers and acquisitions (M&A).
Five growth drivers behind the shift
- People: With 1.4 billion citizens and a median age under 30, India’s workforce is expanding in both size and skill. Rising incomes are fuelling domestic demand, while a deep pool of talent in technology, engineering and finance is attracting strong international interest.
- Technology: India has leapfrogged traditional legacy systems to create a cutting-edge digital infrastructure. Innovations such as Aadhaar (digital ID), UPI (real-time payments), and India Stack (public digital architecture) are matching – and in some cases exceeding – the capabilities of developed markets.
- Policy reform: Corporate tax cuts (as low as 15% for new manufacturers), the nationwide Goods and Services Tax (GST), liberalised foreign direct investment (FDI) rules and the Insolvency and Bankruptcy Code have created a pro-growth, deal-friendly environment for investors.
- Manufacturing push: Flagship initiatives like “Make in India” and Production Linked Incentive (PLI) schemes are building globally competitive capabilities in electronics, electric vehicles, solar energy, and pharmaceuticals.
- Geopolitical positioning: India’s stability, democratic governance and non-aligned diplomacy make it an attractive alternative in a fragmented global order. It is already benefiting from the “China+1” diversification strategy, strong capital flows from the Middle East, and deepened partnerships with the US, Japan, and Europe.
From protectionist to proactive
India’s government has moved decisively from a protectionist stance to actively enabling both inbound and outbound transactions. PLI schemes reward high-output manufacturers, FDI liberalisation has opened previously restricted sectors and “Startup India” initiatives are nurturing an acquisitive domestic tech ecosystem.
Geopolitics as a catalyst
Shifting global supply chains, strategic alliances such as the Quad, and Gulf sovereign wealth investment are positioning India at the centre of global capital flows. This geopolitical advantage is translating into increased M&A activity across multiple sectors.
India’s fundamentals – from macroeconomic stability to progressive policy and global alignment – are firmly in place. For corporates and investors worldwide, the question is no longer if they should engage with India, but how soon.
Ends.
Translink International AG
