In the recent years, the Indian Government has taken special steps to attract foreign companies to invest in India:
(i) The government has set up industrial zones called special Economic Zones (SEZs). SEZs provide world class facilities – electricity, water, roads, transport, storage recreational and educational facilities.
(ii) Companies who set up production units in the SEZs do not have to pay taxes for an initial period of five years.
(iii) The government has also allowed flexibility in the labour laws to attract foreign investment. The companies can now lower workers ‘flexibly’ for short period when there is intense pressure of work. This is done to reduce the cost of labour for the companies.
