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PESTEL Analysis of India: Political Factors

India is one of the world’s most powerful economies. India’s capital is New Delhi. Two major nations border it: China and Pakistan. Bangladesh, Myanmar, Nepal, Bhutan, and Sri Lanka are some of the neighboring nations. India is one of the largest countries in the world. It should also be noted that the political situation in the country is relatively stable. However, in foreign policy, India has several border disputes with China and Pakistan regarding Kashmir. In addition, there was a particular shift in the domestic political situation in 2019, which is connected with the law on citizenship (Wajid & Zafar, 2021). The fact is that in India, it was forbidden to grant citizenship to refugees from other countries who are Muslims. This event led to protests inside the country.

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Despite this, democratic views at the government level are quite highly valued in India. Consequently, there is a separation of powers and civil rights among the population (Jain, 2017). This fact is quite significant since the political climate is one of the criteria for attracting foreign investment. The main problem of India is also the high level of corruption in the country (Jain, 2017). This fact slows down the potential for economic growth in the country and is also a factor of scaring off foreign investment. However, the country is experiencing increased political awareness of this situation both among the population and among the heads of government, which should lead to positive changes.

Economic Factors

India is one of the largest economies in the world in terms of GDP. According to the data, the GDP is about 2.5 trillion dollars (Dahiya & Kumar, 2020). However, based on the current situation around the world, India is also experiencing various problems. First, it is a drop in the level of purchasing power and consumer demand. Secondly, it should be noted that the lockdown in 2020 led to several sad consequences. So, about 122 million people lost their jobs (Dahiya & Kumar, 2020). However, there are also positive aspects. India occupies a leading position in some areas of the economy.

India is the seventh-largest country in the world in terms of coffee production and supply. Also, this country is one of the leaders in the agricultural sector. Investments in this sector should amount to about 120 billion dollars by 2025 (Kumar, 2020). The critical export areas for India are pharmaceutical products, jewelry, and transport equipment. In the field of import, India needs to purchase various electronics, gold and silver, and fuel. The main trading partners are China, the United States, and the United Arab Emirates (Kumar, 2020). In addition, India is one of the fastest-growing countries. Consequently, the domestic market of the country represents many opportunities for foreign companies. The main sectors where there is significant growth are computer technology, infrastructure, and medicine.

Social factors

India is a relatively large country with a population of more than 1.3 billion people (Ghosh, 2019). This factor presents many opportunities for foreign companies, as India provides a reasonably wide range of consumers. Also, this country is of interest for cheap labor, which is also a factor in attracting foreign capital. In addition, India is a country with a diverse population by nationality, language, and religion (Ghosh, 2019). Also, this country is known for its unique sport called cricket, which is quite an attractive factor. Every year, the middle class of the population in India is increasing. However, at the moment, there are problems with poverty and health care.

Technological Factors

India is a reasonably technologically developed country. According to some reports, it may even be among the top three leaders in terms of technical equipment of countries (Benedexa, 2020). This fact is one of the main ones in the issue of attracting foreign capital. Thus, many tech giants are opening their divisions in this country. These companies are Facebook, Apple, Microsoft, and Amazon, which annually invest billions of dollars in this area of the Indian economy (Benedexa, 2020). All this leads to the fact that India is one of the leading suppliers of IT specialists worldwide. This is due to the fact that the country has a reasonably advanced IT infrastructure, which leads to the emergence of a large number of highly qualified programmers and other employees. Thus, India is quite an attractive place to invest in e-commerce, software, and mobile applications.

Environmental Factors

It is worth noting that the accelerated technological progress of any country is associated with the risk of environmental problems (Lokhwandala, 2020). India is no exception in this case and faces such a number of problems as air pollution, water pollution, which are associated with a considerable amount of garbage in the waters of India (Jacob, 2020). There are also problems with frequent flooding and forest destruction. These problems should be provided for doing business since foreign specialists may find life difficult in such conditions. However, despite this, there are also positive aspects. India is quite an attractive place for tourists due to its unusual flora and fauna. In addition, India is famous for its unusual traditional cuisine.

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Legal Factors

Equal opportunity for everyone, advertising, discrimination legislation, copyright law, consumer rights, and other legal factors are among them. They are feasible, particularly for foreign businesses looking for a market in India. Companies must follow the regulations and legislation that are specific to each country or location where they do business (Jain, 2017). Recent changes in recycling, employment, and discrimination legislation may have an impact on the company’s pricing and labor expenses (Jacob, 2020). Foreign brands have more possibilities to operate in the region because of the government’s flexible regulations on foreign commerce.

Education System Within India

The education system in India has been undergoing significant changes in the direction of development and improvement over the past decades. The reason for this is the rapid growth of the country’s economy and an increase in the need for qualified scientific and working specialists. Much attention is paid to all levels of education — from preschool to higher education, getting a good education and a decent specialty among the country’s population is one of the urgent tasks of life (Gupta, 2019). Studying at higher educational institutions in India is becoming increasingly popular among international students (Aithal, 2020). Moreover, there are several traditional ways to get an education for free, not only higher but also postgraduate.

The educational system of India includes several stages: preschool education; school; secondary vocational education; higher and postgraduate education with academic degrees (bachelor, master, doctor). Accordingly, according to the types of education in India, it is divided into secondary, high school, vocational, higher, and additional education (Aithal, 2020). The non-state educational system operates under two programs. The first one provides for the training of schoolchildren, the second one for adults. The age range is from nine to forty years. There is also an open education system, under which several open universities and schools operate in the country.

Pre-school Education

Traditionally, in India, young children have always been under the supervision of mothers and relatives. Therefore, the system of kindergartens in this country never existed. The problem had become acute in recent decades when both parents often began to work in the family (Aithal, 2020). Therefore, additional groups were created everywhere in schools, acting on the principle of preparatory classes. As a rule, preschool education begins at the age of three. The training takes place in a playful way. It is noteworthy that at this age, children begin to learn English (Aithal, 2020). The process of preparing for school lasts one to two years.

Secondary Education

School education in India is built according to a single scheme. The child begins to study at school from the age of four. Education in the first ten years (secondary education) is free, compulsory, and carried out according to the standard general education program (Gupta, 2019). If the program is the same for everyone in India’s first stage of school education, then when students reach the age of fourteen and go to high school, they choose between fundamental and vocational education (Aithal, 2020). Accordingly, there is an in-depth study of the subjects of the chosen course. Preparation for admission to universities takes place in schools. Students who have chosen vocational training go to colleges and receive specialized secondary education. School education is conducted six days a week (Aithal, 2020). The number of lessons varies from six to eight per day. Most schools have free meals for children. There are no grades in Indian schools. However, mandatory school-wide exams are held twice a year, and national exams are held in high schools.

Higher Education

Higher education in India is prestigious, diverse, and popular among young people. More than two hundred universities are operating in the country, most of which are focused on European education standards (Gupta, 2019). The higher education system is presented in the European three-stage form. Depending on the duration of their studies and the chosen profession, students receive bachelor’s, master’s, or doctor’s degrees (Aithal, 2020). In recent decades, due to the steady development of the Indian economy, the number of engineering and technical universities has increased. The Indian Institute of Technology and the Institute of Management are among the most attractive and worthy here. The share of graduates of humanities in India is about 40 percent (Aithal, 2020). Along with traditional universities, there are many specialized higher educational institutions in the country, focusing on native culture, history, art, and languages.


Aithal, P. (2020). Analysis of the Indian national education policy 2020 towards achieving its objectives. International Journal of Management, Technology, and Social Sciences, 5(2), 19-41.

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Benedexa, A. (2020). Technological entrepreneurship and dynamic entrepreneurial capabilities in Indian IT industry. International Review of Business and Economics, 4(1), 148-54.

Dahiya, S., & Kumar, M. (2020). Linkage between financial inclusion and economic growth: An empirical study of the emerging Indian economy. Vision, 24(2), 184–193. Web.

Ghosh, B. (2019). Study of Indian society and culture: Methods and perspectives. Kerala Sociologist, 47(1), 13-29.

Gupta, S. (2019). Changing trends in Indian education system: Merits and demerits. International Journal of Innovative Technology and Exploring Engineering, 8(4), 15-16. Web.

Jacob, M. (2020). Actors, objectives, context: A framework of the political economy of energy and climate policy applied to India, Indonesia, and Vietnam. Energy research and Social Science, 70, 11-17. Web.

Jain, R. (2017). Public sector enterprise disinvestment in India: Efficiency gains in a political context. Journal of Asian Economics, 53, 18-36. Web.

Kumar, G. (2020). Foreign direct investment and Indian economy. Journal of Commerce, Economics and Management, 1(1), 10-15.

Lokhwandala, S. (2020). Indirect impact of COVID-19 on environment: A brief study in Indian context. Environmental Research, 188, 109-118. Web.

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Wajid, M. A., & Zafar, A. (2021). PESTEL Analysis to identify key barriers to smart cities development in India. Neutrosophic sets and Systems, 42, 39-48.

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