March of the Venture Capitalists

Hi folks

I found this extremely informative article on Private Equity in India (Courtesy: Ernst and Young).

Some highlights:

Reasons for optimism

1.Attractive demographic profile: 54% of population below age of 25
2. Intellectual horsepower: Over 23 million trained professionals – doctors, engineers, lawyers etc, and growing by half a million/year
3. Government moves towards deregulation
4. Billions of dollars of Private equity: which in turn invigorates entrepreneurial talents, the stock market and M&A activity. For example: in 2005 the cumulative value of all exits exceeded 1 billion dollars.

Trends
1. I.T and IT enabled services still constitute the bulk of private equity activity.
2. Emergence of the sunrise sector -- Textiles, Biotechnology, Telecom and Energy
3. Moving up the value chain from back office work to R&D and Knowledge Process Outsourcing(KPO)

The article contains a lot of other information on tax laws, India's compliance with Intellectual Property rights under GATT, routers for foreign investments in India and more. A MUST read.

Cheers