What is PESTLE analysis in India?

INDIA

India, also known as the Republic of India , is a country in South Asia. Its the seventh largest
country by area and with more than 1.3 billion people, it is the second most populous country as
well as the most populous democracy in the world. Bounded by the Indian ocean on the south,
the Arabian sea on the southwest , and the Bay of Bengal on the southeast, it shares land borders
with Pakistan to the west , China, Nepal and Bhutan to the northeast, and Bangladesh and
Myanmar to the east. In the Indian Ocean, India is in the vicinity of Sri Lanka and the Maldives,
while its Andamanand Nicobar Islands share a maritime border with Thailand and Indonesia.

Home to the urban Indus Valley Civilisation and a region of historic trade area and vast empires.
Indian subcontinent was identified with its commercial and cultural wealth for much of its long
history. Four major religions they are Hinduism, Buddism, Jainism and Sikhism. Originated
country , while the Zoraostrianism, Judaism, Christianity and Islam arrived in the first
millennium of CE and shaped the region’s diverse culture . The British East India Company
from the early eighteenth century and colonised by the United Kingdom from the mid Ninteenth
CE, India became and Independent nation in 1947 after a struggle for Independence that was
marked by wide spread non- violent resistance

India is a republic consisting of 28 states and 7 union territories with a parliamentary system of
democracy. It has the world’s 12th largest economy at market exchange rates and the fourth
largest in purchasing power. Economic reforms since 1991 have transformed it ino one of the
fastest growing economies; however it still suffers from high levels of poverty, illiteracy, disease
and malnutrition. A pluralistic, multilingual and multiethnic society.

INDIA AT GLANCE

1. POPULATION : 1,150,000,000(1.5 billion)

2. AREA: 3.3 million square kilometres
3. COASTLINE LENGTH : 7600 km
4. LANGUAGES: 17 major languages, 844 dialects
5. RELIGION : Hinduism, Islam, Buddhism, Christianity,Sikhism,Jainism
6. NATIONAL ANTHEM : Jana Gana Mana by Rabindranath Tagore
7. NATIONAL SONG : Vande Mataram, composed by Bankimchandra Chatterji
8. NATIONAL EMBLEM : Replica of Lion Capital of Sarnath
9. NATIONAL ANIMAL : Tiger (Panthera Tiger)
10. NATIONAL BIRD : Peacock
11. NATIONAL FLOWER : Lotus
12. NATIONAL TREE : Banyan
 13. NATIONAL FRUIT : Mango
14. NATIONAL CURRENCY : Rupee (One Rupee = 100 paisa)
15. NATIONAL SPORT : Hockey

INTRODUCTION
PESTLE ANALYSIS IN BUSINESS ENVIRONMENT
In business PESTLE analysis role is very important. Originally designed as a business
environmental scan, the PESTLE analysis is an analysis of the external macro
environment in which a business operates. These are factors which are beyond the control
or influence of a business, however are important to be aware of when doing product
deevelopment , business or strategy planning
PESTLE means :
P : POLITICAL
E: ECONOMICAL
S: SOCIAL
T: TECHNOLOGICAL
L: LEGAL
E: ENVIRONMENTAL

The PESTLE subject should be a clear definition of the market being addressed, this is
the following :-
 A company looking at its market
 A product looking at its market
 A brand in relation to its market
 A local business unit or function in a business
 A strategic option, such as entering a new market
 A potential acquisition
 A potential partnership
 A investment opportunity

PESTLE FACTORS IN INDIA :

POLITICAL

These refer to government policy such as the degree of intervention in the economy, What goods
and services does a government want to provide ? To what extent does it believe in subsidising
firms? What are its priorities in terms of business support? Political decisions can impact on
many vital areas for business such as the education of the workforce, the health of the nation and
the quality of the infrastructure of the economy such as the road and rail system

India is the biggest democracy in the world. The government type is federal republic. Based on
English common law, judicial review of legislative acts, accepts compulory ICJ jurisdiction with
reservations, seperate personal law codes to apply to Muslims, Christians and Hindus. The
political situations in India is more or less stable. Most of its democratic history, the federal
government of India has been led by the Indian National Congress (INC). State politics
dominated by several national parties including INC. The Bhartiya Janata Party(BJP), the
Communist Party of India (CPI) and various regional parties. In 2009 Indian elections, the INC
won the biggest number of Lok Sabha seats and formed a government with a alliance called the
United Progressive Alliance (UPA) , supported by various left- leaning parties and the members
oppposed to the BJP. Overall India currently has a coalition led government and both major
political parties the UPA and BJP, whichever comes in power.

It comprises political stability and the policies of the government. Ideological inclination of
political parties, personal interest on politicians, influence of the party forus etc. create political
environment. For example , Bangalore established itself as the mos important IT centre of India
mainly because of political support.

In India many political factors affect the business environment. Political pressures in
ruling government and vote bank problems. These are the major factors which affect the
political environment :-
i. TAXATION POLICY-
India has a well developed tax structure, comprising the Union Government, the
State Governments and the Urban and Rural Local Bodies. The power to levy
taxes and duties are distributed among the three tiers of Governments , in
accordance with the provisions of the Indian Constitution. The main duties that
the Union Government is empowered to levy are income tax,custom tax, central
excise, sales tax and service tax. The principle taxes levied by the State
Governments are sales, stamp duty, state excise,land revenue and duty on
entertainment and tax on professions and callings. The Local Bodies are
empowered to levy tax on properties, octroi tax on markets.

ii. PRIVATISATION –
Reduce the political interface in the management of enterprises, leading to
improved efficiency and productivity. In the beginning government company
donot face the problem but after sometime they start facing problems so they opt
for privatisation.

iii. DEREGULATION-
Indian government makes some act through which one can perform business
freely.

iv. INTERNATIONAL TRADE REGULATIONS-

 International Trade Regulations makes easy and smooth functioning of foreign
trade in India.

v. INTERNATIONAL STABILITY
If there is no stability in the country, it would lead to uncertainity in the market.

ECONOMICAL

It includes interest rates, taxation changes, economic growth, inflation and exchange rates.