Why is India Inc dragging its feet on investments despite strong optimism?

A closer look at demand visibility, firm strategy, and the role of long-term FDI shows why private investment remains slow even in a strong economy

All commentary on India’s economic situation is in agreement that private investment must perk up for gross domestic growth (GDP) growth to accelerate or even be maintained, and that there is only so much that a fiscally responsible government can do. Keeping aside investment for export businesses, which has its special set of challenges, such as cost competitiveness in manufacturing and the availability of high-end human talent for services, on the domestic business front, the refrain from economists for a while now has been that companies are not seeing the necessary “demand visibility” in order to invest.