Table of Contents:
Best Cities To Do Business In India
World Bank’s Ease of Doing Business Report has put India in the 63rd spot among the 190 countries it tracks. This is an improvement of 23 ranks in a span of one year. It is important for global businesses to look at India as the next destination for growth because outside USA and China, India is the only under-penetrated large market.
Hence, there is no surprise in the fact that India is now attracting major investments from Mauritius, Japan, Singapore, Netherlands, and USA. Globally revered institutions like Canada Pension Plan Investment Board, Ontario Teachers’ Pension Plan, OMERS, CDPQ, Abu Dhabi Investment Authority, and several other public and private asset managers helping the business in India grow.
Where does a business choose to establish itself always has a major impact on its initial growth trajectory. Being in the right location can give you access to the right talent market, suppliers, investors, and even infrastructure along with the access to the right customer base.
If you are considering establishing your business in India as an expat or an Indian citizen, here are the top 10 cities you should be considering:
Mumbai is often referred as the financial capital of India. It is home to Dalal Street, India’s equivalent of Wall Street. With access to capital markets, Mumbai can definitely help you get the initial funding very quickly. All major banks and financial institutions have their central administrative offices in the city. This means that major applications for loan, mortgage, and equity financing have faster processing rates.
Besides that, Mumbai is also home to IIT Bombay, JBIMS, SP Jain and several other institutions offering remarkable access to talent. The infrastructure in the city has been improving but there are challenges posed by the increasing population. While you can easily get your business started here, it would be difficult to scale as the competition is fierce across all major verticals. That said, your probability of succeeding would also remarkably go up.
Mumbai is home to major startups like Quikr, Ola Cabs, Pepperfry, Bookmyshow, and Nykaa. Even though the cost of real estate has been steadily rising in the city for the last few decades, it provides almost unmatched access to capital, suppliers, and customers.
Delhi also includes the Delhi NCR part, which is the capital of India. While this is a commonly known fact, it has direct implications on making Delhi more attractive as a city to establish a business.
If you are an expat, you would prefer the climate in Delhi over Mumbai throughout the year. Besides, although the city is almost as highly populated as Mumbai, the population density is marginally better. This gives the city better access to infrastructure.
Delhi is also home to IIT Delhi, FMS Delhi, JNU, and other major institutions of academic prominence. The arts and cultural scene in Delhi is considered to be at part with several global destinations. If your industry has anything to do with government projects – Delhi would be the city for your growth.
Major startups like Oyo and Policybazaar started and scaled from Delhi. Even renewable energy giants like ReNew Power established themselves in Delhi and scaled further.
3. Bangalore or Bengaluru
Bangalore is also touted to be the ‘Silicon Valley’ of India. It is home to several venture capital giants like Sequoia Capital, Kalaari Capital, Accel Partners, and many more. You will find Bangalore to be the basin of India’s tech talent. The city is already home to major technology companies like Cisco, Capgemini, Accenture, Oracle, IBM, TCS and Infosys. It is also the home to some of India’s leading startups like UrbanLadder, Hector Beverages, Vedantu, ZoomCar, and many more.
Bangalore also home to IIM Bangalore, considered to be one of the finest b-schools in the country. The city is well-suited for businesses that are primarily dependent on technology. Even if your business does not have a tech front, you should consider having an office in Bangalore that can work specifically on technology to optimize your business processes. Many global businesses have followed the same strategy.
Pune is a very unique proposition for investors and operators wanting to establish presence in Mumbai. The city has access to Mumbai’s market of investors, customers, and suppliers, since Pune is geographically close to Mumbai. However, Pune does not have the explicitly high costs of real estate which often make doing business in Mumbai a little difficult.
You can be in Pune and actively have a presence in Mumbai with the Mumbai-Pune Expressway at your service. With prominent universities like Symbiosis, and presence of several technology giants like TCS and Infosys, you will have access to umpteen amounts of talent without having to incur the high operating costs of Mumbai.
In an annual cleanliness survey conducted by the Government of India, Indore emerged as the cleanest city in India – for the fourth time in 2020. The survey considered several parameters with a population of one million considered to be the benchmark of being termed a city.
While the survey focuses on cleanliness, which is a metric better-suited to evaluate living standards, it also shows the government’s efforts in making Indore a more economic city. Since it sits on the Mumbai-Delhi corridor, Indore has great access to national highway infrastructure. Even if you don’t plan to have an HQ in Indore, the city can prove to be a strategic choice for technology, IT, and middle-office operations. It is also home to institutions like IIM Indore, and has started offering competitive access to talent.
Before Bangalore rose to prominence, Hyderabad was considered to be the IT capital of India. Many global technology giants like Google and IBM have established their presence in the city. Thanks to its successful IT culture, the city has a lot to offer in terms of capital-awash investors as well as a growing talent market.
The city’s population has been steadily growing, with institutions like ISB Hyderabad serving the need for premiere talent required by local businesses having global ambitions. Most of the people in the city are associated with the services industries focusing on technology, pharma, and biotech. Hence, if you are planning to have a services business, Hyderabad should be on your radar.
While other cities serve as independent hubs, Chennai should be looked at as a composite gateway to the South Indian market. The city, earlier called Madras, is one of the best cities to establish your business if you want to understand whether your products and services will work in the Southern part of India or not.
Chennai has a high literacy rate of above 80%, hence finding the right talent would not be difficult. The real reason why Chennai has made it to the list is because of the local government’s focus on building SEZs and Software Technology Parks of India in the city. The city is also home to IIT Madras, considered to be one of the most revered IITs in the country.
Contrary to popular beliefs, there is much more to Nagpur than its mangoes and other agricultural products. It is very close to the geographical centre of India and is one of the very few cities in the country with rail-access to capitals of almost all the other states.
Its geographic location makes it an obvious distribution centre hub for Maharashtra. However, you will be able to easily expand into Madhya Pradesh because of the state’s proximity to Nagpur. The city also houses a Multi-Modal International Cargo Hub and Airport Nagpur. This makes it a very affordable base to install your warehousing, logistics, and storage facilities in the city. Many companies like Mahindra, have started building a base in Nagpur. Major realtors are also considering building townships in the city.
9. Kolkata or Calcutta
Kolkata is home to the oldest IIM in the country. Besides, it is also very close to the jute and sugarcane industries in India. If you plan to have a business anywhere related to mining and identical fields, Kolkata should be the city of your choice for operations.
The city has started working on its infrastructure and also hosts several businesses like Coal India, Emami, Sterlite Copper, Vikram Solar, Tata Steel, and Spencer’s Retail. While some people consider the city to be a hub for arts and culture, it is also great for establishing a new entity.
10. Noida & Gurgaon
Unlike its contemporaries, Noida and Gurgaon are two different cities. But, it would be insufficient to discuss one without discussing the other. Gurgaon is the technology, services, and IT hub, with major global businesses establishing their presence here. However, most of Gurgaon is covered with corporate and IT parks. The talent availability is fulfilled by Noida, which is quite close to the city. Hence, people tend to live in Noida and work in Gurgaon. If you can balance out this dynamic, you will have access to a market of people showing fast social mobility as well as investors, suppliers, and business infrastructure.
11. Key Takeaways
There are other key cities like Ahmedabad, Surat, Visakhapatnam, and many others, which have their own appeal for specific industries. The city you choose for establishing your business would be dependent on the industry you operate in, the market you want to cater to, and the need for human as well as startup capital. The best way to understand which city would work well for your business would be by determining which are the top businesses in the city. Generally, the top businesses in the city have stayed there because the city has some inherent benefits to support their ecosystem. Bangalore has a tech ecosystem, Kolkata has an industrial ecosystem, Mumbai has a capital markets ecosystem, and Delhi has a government contract & infrastructure ecosystem.
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Q. Which are the best cities for business in India?
Ans- Please refer to the above list for the top 10 best cities for business in India.
Q. Which is the No 1 city in India?
Ans- According to the Ease of Living Index 2020, Bengaluru emerged as the No 1 city in India.
Q. Which city has more job opportunities in India?
Ans- This is the list of top cities that has the most job opportunities in India:
- Delhi NCR
Q. Which city is called the business city of India?
Ans- Mumbai is officially known as the business city of India, and also the commercial capital of India.
Q. Which is the poorest city in India?
Ans- Alirajpur district in Madhya Pradesh is the poorest city in India.
Q. Which is the cleanest city in India?
Ans- Indore in Madhya Pradesh is the cleanest city in India.
Q. Which are the top business cities in India?
Ans- These are the top 10 cities to do business in India:
- Bangalore or Bengaluru.
- Gurugram & Noida.
Q. Which state is richest in India?
Ans- Maharashtra is the richest state in India.
Q. What business can I start with 5 lakhs?
Ans- These are the top 10 small businesses you can start in India with 5 Lakhs:
- Housekeeping Services
- Home-based Catering
- Cloud Kitchen
- Merchandising services
- Revenue credit billing
- Tank cleaning
- Verification services
- Custom-made chocolates
- Concierge services
- Wedding planning
Q. Which company is biggest in India?
Ans- Reliance Industries and Corporation is the biggest commercial company in India. Owned by Mukesh Dhirubhai Ambani & Anil Ambani, they control a major portion of India's economical strata.
Q. Which city is growing the fastest in India?
Ans- Malappuram city in Kerala is the fastest growing city in India. It is also the fastest-growing city in the world.
Q. Which is the safest business in India?
Ans- These are the top 10 safest and most profitable businesses in India (2021):
- Scrap Collection
- Online Ads Service
- Customised Gifting
- Event Management
- Digital Marketing
- Ultra-Short Temping Services
- Real estate & property management
- Sell Pandemic Sanitary Equipments
- Incense Stick Manufacturing
- Transport Services
Q. Which city is the business hub of India?
Ans- Mumbai city is the official business hub of India. Also termed as the financial capital of India, this city boasts impeccable business opportunities from millennials to Gen-Z.
Q. Which city is the Startup hub of India?
Ans- Bangalore or Bengaluru is the startup hub of India. Also known as the Silicone Valley of India, the city has seen over 11,000 startup launches between the year 2014 to 2020.
Q. Which is the best city to live in India?
Ans- This is a list of the top 10 best cities to live in India:
- Navi Mumbai
Q. How Do You Select a City to Establish Your Business in India?
A. You should have a clear idea about what market you are servicing, what type of infrastructure you need, and what type of capital/talent you seek. Based on these, you can easily choose between the cities listed here and select the most cost-effective solution.
Q. Is Mumbai the Best City to Conduct Your Business in India?
A. If real-estate cost is not a major constraint for your business, then Mumbai might be the best city to conduct your business in India. It has great access to capital, talent, and market resources. However, the competition across all industries is fierce and when you factor the cost of real estate and transportation, you might have other options well-suited for businesses with resource-constraints.
Q. Where Should You Setup an IT Business in India?
A. Bangalore and Hyderabad would be the nature choices for setting up IT businesses. They already have an ecosystem ready for IT businesses with the adequate access to capital, availability of talent, and availability of buyers of IT and related services. However, you should also consider cities like Pune and Indore, which have a growing ecosystem and might be more cost-effective than their counterparts.
Q. Where Should You Setup a Manufacturing Business in India?
A. Manufacturing businesses are well-suited for regions that are outside the geographic limits of the city. If you can plan the supplies efficiently, Nagpur would be a great choice. Kolkata would be the preferred choice for heavy-industry manufacturing.
Q. Which is the Best City for Expats in India?
A. Expats tend to prefer Delhi for its climate and access to government offices. Bangalore is also considered to be an expat-friendly city, with a lot of people both leaving to foreign destinations from the city and an equally high number visiting the city quite regularly. Mumbai has the necessary infrastructure for expats, however the climate in the city can be a little challenging.
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