India VS Denmark: Which is the Best Country for Doing Business?
Among the developing countries, India and Denmark are exceptional in improving economic growth. In doing business, both countries have valuable markets. The increasing rate of foreign investments indicates each economies’ favourable future. As a result, these two countries have a growing number of international companies willing to invest. But, between the two, India VS Denmark, which country is better for doing business?
If you have the same question in mind, read on the points of comparison below.
Scope For Business Sustainability
India’s economic expansion focuses on developing cities with large infrastructure development plans. Among these cities, sixty-nine of which have over a million residents each. These numbers translate to a higher need for businesses to provide livelihoods. Also, the rapid urbanization indicates that a large group of the population will join the middle-income classes.
While in Denmark, for 19 years, the Danish market has been in a sustainable classification but hasn’t reached the upper ranks. The root of which are unnecessary government expenditure and high tax rates. Such issues also explain why GDP growth has become modest over the past five years in Denmark.
As the startup hub of Asia, India is a venue for eager entrepreneurs. The Indian economy is open to approving new marketing strategies to make it easier for new businesses to connect. Thus, it would be ideal if you’re sure to have the right strategy to incorporate your company to other jurisdictions and help you through your start-up years.
Conversely, though it’s a developed and liberal country in Denmark, people in business aren’t treated equally. The integrity of a startup company is more vulnerable than that of a larger corporation. One contributing factor to this issue is the possibility of staining the local image with unpleasant activities (e.g., reducing workforce). As far as business is concerned, community relationships are essential in the Danish industry.
Costs of Doing Business
It’s also worth comparing the cost of doing business in each country. The developmental priorities of the Indian government caused the nation’s trade openness to improve. More importantly, foreign direct investment through a sole proprietor or limited company no longer needs the national government’s interference. It thus effectively reduced the expenses associated with doing business in India.
On the flipside, in Denmark, as your business entity’s scope increases, the expenditures for doing business grow higher. That means the basic business structure, the sole proprietor, had minimal expenses. In contrast, the highest expenses are expected by the public limited companies.
Another indicator worth comparing is employability. It is the key determinant in a foreign market for any corporation starting a business. India has a working population of almost 530 million citizens, the bulk of which are below 30 years old.
But, employability ratings are rather poor in Denmark. The reason is that workers have to pay for Danish welfare benefits, which is referred to as the labour market contribution. The contribution corresponds to 8% across all individual income. The worst is that the contribution is deducted from their income statement.
Lastly, business owners should also look into a country’s business-friendly regulations. The Indian government passed several major bills that are helpful for most major industries. These bills create accountability and standardization in the Indian economy. Examples of these valuable bills are the Direct taxes Code and the Goods and Services Tax Bill.
Besides, the Indian government aims to develop the best manufacturing base in Asia. They do this by facilitating foreign investment, fostering creativity, improving expertise, and concentrating on patents’ security.
Contrarily, the Danish government heads in the opposite direction from what their country needs. The government imposed even heavier taxation, lowering energy consumption and expanding the already broad welfare state.
Setting up a business in new markets is not a responsibility to take casually. You ought to sweeten this move with a proper business plan. Failure to do so might cause your business to suffer significant losses.
Companies should take advantage of how much the Indian market has to offer. Contact 3E accounting India to introduce growth and development strategies for your business.