Indian election results give the green Light for Foreign Franchises

22 May 2014

Following the general election in the world's largest democracy, the Bhartiya Janata Party (BJP) has come to power in India under the leadership of Narendra Modi. It is the first time since 1984 that any single party has secured a majority in Parliament, and is being declared a good sign for the economy by the Indian business community.

In recent years India has faced severe economic challenges; inflation, stagnation and so-called 'policy paralysis’. This has adversely impacted the appetite of many Indian businesses for investing in foreign brands and the number of foreign franchisors finding suitable Indian partners has dropped significantly over the last couple of years or so.

The election results are expected to reverse this trend and amount to a clear pro-business mandate which is creating high expectations that the new government will revive the economy.

Standing on a 'less government and more governance’ platform, the BJP election manifesto promises policy continuity and a host of pro-business measures which bodes well for both foreign direct investment (FDI) and foreign franchising in India.

The surge in the Indian stock market is a reflection of the business community's positive attitude which will help put India back on a growth trajectory. It is expected that this predicted growth should increase the appetite of the Indian business community for investing in foreign brands, particularly in the retail and F&B sectors. "