India Needs Stronger Property Rights to Attract Ample Foreign Direct Investment

Abstract

A lot of companies are looking for alternatives to China for their manufacturing. As it stands now, India and Vietnam are competing for the top spot. Vietnam reformed their property rights last year which puts them at a distinctive advantage over India and there is no recognition in India of this. This adds significantly to the urgency of what makes reforming property rights the number one issue that needs to be addressed if India is to become the economic goliath that is her destiny. India being among the most economically developed is nothing new. For an extended period of time in history, a quarter of the World’s GDP was produced in India (Maddison, 2007). Furthermore, prior research shows the orthogonal condition applies to robust property rights and predatory MNCs with business practices that result in extraction of natural resources while exacerbating conflicts and turmoil in the region. The key is robust property rights encouraging manufacturing, etc. with other regulations in place to prevent predatory business practices. A look at per capita high-income nations, such as the OECD countries, who have strong property rights makes that case. Additionally, the Modi government has a strong reputation of being anti-corruption. Stronger property rights have historically led to further reforms which have cleaned up corrupt practices in other countries (Bai, et al, 2019).