India VS Hong Kong: Which Country Is Better in Doing Business?
Where in Asia is the ideal location to set up your business? For entrepreneurs, it means the difference between India VS Hong Kong. Both countries have geographical beachhead locations for core businesses from which they can reach many rapidly developing economies.
At first thought, India and Hong Kong both provide international entrepreneurs with very comparable opportunities. But how can they compare favourably? What would each country foresee from an overseas enterprise?
To decide which country is a better match for your company, read the correlations below.
Ease Of Doing Business
Reforms for liberalization put a stop to license limits and accelerated the Indian economy. Reduced tariffs on imports, tax cuts, and industry reforms are some of the notable developments. On top of that, the government also increased the involvement of international and private sector investment. By this, the Indian government lived up to their pledged provision; In India, it will be ‘easy to do business.’
On the other hand, when setting a new business in Hong Kong, you have to secure all the required business licenses, permissions, certifications, and approvals. In particular, you need to get separate permits and licenses from the Hong Kong government based on the types of products or services you will provide.
The second basis of comparison as to which country India VS Hong Kong is better in doing business is their economic growth. After the market giants the US and China, India is after the GDP value of around $2,264 billion and increasing at 7.1 % per year. As a result, investors from all over the world, such as Angel investors, venture capitalists, and investment firms, are drawn to invest money in India.
Whereas the economic growth in Hong Kong might compress by 1%-3% in the coming years, This is because of the country’s lack of a simple roadmap to handle foreign investors’ bearish sentiments. Thus, the government’s current actions aren’t adequate to resolve both cyclical and structural challenges.
Loans, Incentives, and Other Facilities
It is also worth comparing loans, incentives, and other facilities, in doing business between the two countries, India VS Hong Kong. To optimize Indian companies, especially MSMEs (micro and small to medium scale enterprises), the government approved many business benefit programs, debt instruments, and many more. All these benefits are on top of the streamlined registration processes for MSMEs. Furthermore, the government aimed to strengthen MSME” s involvement by providing available loans, encouraging their goods, providing opportunities for promotion, assisting with training, and so forth.
The mere process of opening a local bank account may often be a challenge for new Hong Kong startups. rIt is because Hong Kong financial institutions have stringent criteria for opening new business accounts. Besides that, banking policies are regularly updated, which creates varying requirements and processes for business owners.
Another factor in analyzing which of the two countries, India VS Hong Kong, is better in their active workforce. The average age of a resident in India is 25.1 compared to Hong Kong citizens of 43.2 years. Also, over 500 million Indians are below 25 years old and are interested in furthering their entrepreneurship potentials.
Furthermore, the cost of starting up a company in Hong Kong is comparatively higher. One factor that contributes to the high costs is the unavailability of cheap workers.
Also, one should look into the markets in comparing which country to set up a business in. Throughout India, consumer spending grew reasonably stable at 10% compared to Hong Kong, which remains at a 3.43 % rise from the past five years. This indicates that there is approximately $1.4 trillion worth of prospects in India.
Hong Kong slumped into a recession and cautioned of an unprecedented economic slowdown. As a low-tax and low-regulatory marketplace for finance and commerce, the lengthy reform became an element of political strife instead of being the primary solution.
Business Friendly laws
Finally, the Goods and Service Tax (GST) bill, which is under review in government for many years, has been approved and executed. In the long run, GST will help industries ensure quicker and more effective transport of goods in India.
Whereas in Hong Kong, data privacy is another obstacle that must be faced to operate your Hong Kong company. There are no clear data security laws in Hong Kong for industrial areas.
Now that you understand that India is the best destination to launch a new business, focus on properly setting all your business procedures. Doing this would save you time and minimize the risks that might stifle your company’s success.
Moreover, contact 3E Accounting India today if you have not yet licensed or incorporated your company. You will fully play and embrace a sense of freedom in doing your business.