Indian Prime Minister Narendra Modi made a passionate pitch to investors that they should invest in India, assuring them that it’s a “golden opportunity.”
“This is just the beginning,” Modi told the audience during his keynote speech at the Bloomberg Global Business Forum. “This is a golden opportunity for global businesses to be associated with us. Today, India is in a unique position. If you want to invest in a market where there is scale, come to India. The Indian government respects the business world and wealth creation.”
Modi added that India has four “rare” attributes that make it an attractive investment destination: democracy, demography, demand and decisiveness.
India’s prime minister was in town for the United Nations General Assembly that is currently underway. Modi had begun his U.S. trip with a rally in Houston, Texas, where he addressed the Indian-American community and met with oil industry CEOs. U.S. President Donald Trump had also attended the rally and both leaders expressed willingness to strengthen the U.S.-India relationship.
During the Bloomberg forum, Modi and former New York City Mayor Michael Bloomberg announced two new initiatives to strengthen international investment: Bloomberg partnering with India to navigate how it can be included in global benchmark indices and support for the development of a financial services center in Gujarat.
‘India is waiting for you’
During the keynote, Modi also stated that he aims to make sure India grows at a fast pace, highlighted several initiatives he’s pursuing, and that he believed it will reach the $5 trillion benchmark. One of those initiatives was cutting the corporate tax rate.
Prior to arriving in the U.S., Modi had delivered 1.45 lakh crores (or roughly $20 billion) in tax cuts. The corporate tax rate for domestic firms declined from 30% to 22% (effective tax rate will drop to 25.17%), and for new investments in manufacturing, that number was even lower. It went down from 25% to 15% (effective tax rate will be 17%).
The surprise move, announced by the country’s finance minister, Nirmala Sitharaman, caused the biggest one-day jump in Bombay’s stock market in a decade. The tax stimulus is intended to revive India’s lagging economic growth, which has fallen to a 6-year low, as well as the unemployment rate, which has reached a 45-year high.
The new tax rate also positions the country as an attractive destination as compared to Indonesia, Vietnam, and others, which have been the primary beneficiaries of the U.S.-China trade war.
Modi addressed that move on Wednesday in New York.
“Recently we have deducted corporate tax to increase investment,” he said. “We have abolished 50 old laws. This is just the beginning, much more to come in the coming days. It is going to be a long journey.”
“India is waiting for you. India is the only destination for you."
Aarthi is a reporter for Yahoo Finance. Follow her on Twitter @aarthiswami.