Which of the Indian Cities are Best for Foreign Companies?

Foreign Direct Investment or FDI has played a vital role in driving the economic growth of India and supporting the national non-debt financial resource. The foreign ventures find India a great place for investment due to many reasons like lower labor wages, ace workforce, cost competitiveness, growth model dependent on the demand, huge productivity, tax exemptions and so forth. The Indian Government has made enough efforts to pull foreign investments to the urban vicinity of India by contributing to the infrastructure and economic development of the areas.
The ease of doing business in India and expecting high returns varies from city to city. The Indian cities that top the list in terms of favorable FDI destinations are Mumbai, Delhi, Bangalore, and Ahmedabad. The attractiveness survey has been performed multiple times to figure out which Indian metropolis draws more foreign investments every year. Here is a brief investment attractiveness comparison between the four urban locations – Mumbai, Delhi, Bangalore, and Ahmedabad.


In May 2015, Indian government approved 16 major projects to encourage FDI in India, among which many are Mumbai based projects. Mumbai drives a huge part of the national economy every year. If a business in India depends mostly on the three factors – democracy, demography, and demand; Mumbai helps all types of businesses to leverage all these benefits to the fullest. Mumbai is India’s commercial or economic capital. Considering the interest of the foreign investors, the state government has introduced many prolific policies for the highest revenue-generating sectors of the city like information technology, e-governance, biotechnology, tourism, and infrastructure.
Even during the recent economic flux, Mumbai has maintained the stability in comparison to other cities that contribute hugely to the Indian economy. Many foreign investments have been made in the recent time in Mumbai in the sectors like finance, e-commerce and coding/software development. Many MNCs in Mumbai are offering a salary hike of around 10-15% to motivate the employees. Considering the GDP, Mumbai stands at 29th rank in the list of the world’s largest cities (according to a 2015 survey) and at 1st rank in India. Maharashtra’s GDP is Rs. 22.03 lakh Crore, which is the highest among all the Indian states. Mumbai is primarily chosen as the best FDI spot due to its high GDP value and proximity. The top revenue generating companies’ headquarters in Mumbai includes Tata Group, Reliance Industries and Aditya Birla Group.

Choose Mumbai For –

• Biggest National Economy Contributor
• Strong infrastructure, great communication, highly dexterous professionals and advanced IT resources
• World class transportation for national and international guests
• Standard labor wages
• On time work delivery
• A myriad of service providers


delhi india gate
Delhi stands at the 12th rank in terms of GDP. Delhi is the capital of India and hence visiting the metropolis by the foreign investors is a pretty obvious thing. In Northern India, Delhi is considered as the largest commercial centre. Delhi’s GDP for the year 2016-2017 is estimated Rs. 5.59 Lakh crore. After Mumbai, Delhi is considered as the second-most prolific metro location in India. In the past two decades, a big rise in the manufacturing sector has been noticed in Delhi. According to a survey performed in 2001, around 1,440,000 were employed in the manufacturing sector and a huge jump was seen in the industrial unit expansion.
Talking about the Utility Sector of Delhi, an inhabitant can leverage all the basic benefits here that are expected from a metro city. Be it the affordable housing schemes, adequate power, and water supply or sufficient public transport – Delhi has shown a positive change in the utility sector in a decade. The Delhi Development Authority has promised to avail the inhabitants in the areas like Dwarka, Pitampura, Sukhdev Vihar, Narela, Rohini, Sarita Vihar and to name a few with over 13000 affordable flats this year. Indian government has always kept a progressive attitude towards the capital of India. According to the 2010 to 2021 industrial policy, a huge focus will be on the IT and academic sectors, so that a progressive environment can be created and endured here. In line with a report shared by DIPP, the FDI inflow of Delhi along with Haryana and Uttar Pradesh stood near US$ 62.15 billion and between the years 2000 to 2016. Such a progressive environment is always appreciated by the foreign investors. The connectivity of Delhi is an add-on for the foreign investors. They got IGI international airport, first-rate metro benefits and a slew of public transports.

Choose Mumbai For –

• Affordable real estate
• The center of attraction due to being the capital of India
• Giant market scenario
• Huge population – a positive sign for the demand
• Big International airport availability – lots of international flights
• Good public transportation
• Adequate water and power supply
• Space rentals or property prices are affordable – way cheaper than Mumbai
• Appreciable FDI inflow in the past
• Good GDP growth


Bangalore, the capital of Karnataka is the third most populated Indian city after Mumbai and Delhi.The rise in employment, technical institutes, new industry setups and outstanding support from the Karnataka government has fascinated the regular people and the national as well as foreign investors to find some land here and leverage the benefit. Bangalore is a big IT hub. A foreign company or its branch can avail itself of the top-notch talents, English-speaking environment, progressive IT sector and technological resources. Bangalore is beating all the other Indian cities in terms of academics and research. The best minds can be found in the most reputed institutes of the metropolis. If an IT company shows interest in investing in Bangalore, they got complete support from the Karnataka government as in line with the Software Technology Park scheme, 100% foreign equity is allowed. Not only this, they can leverage the advantages like good telecom connectivity, great relationships with the labors, decent law and order scenario, affordable labor wages, supportive state policies and commendable infrastructure. If human resources, state policies, IT sector benefits and organized services are considered, Bangalore tops the list of most favorable Indian cities for foreign investment. The city stands tall with an economic growth rate of 10.3%, which makes it the second fastest growing Indian city. Once, Forbes stated that the metropolis will shine on with the fastest growing Indian city tag in the next decade. In 2015, Bangalore’s GDP per capita (PPP) was $5,051. The Karnataka government encourages the FDI in Bangalore by making 90% corporate tax exemption and duty free imports. Many IT giants have their headquarters in the city, including Sonata, Software, Strand Life Sciences, IBM and Mindtree.

Choose Bangalore For –

• Flexible and supportive FDI policies by Karnataka government
• Tax and duty benefits are unparalleled
• A big IT hub
• Well-versed English speakers and technically skilled folks available
• One of the best telecom connectivity
• Standard labor prices and organized services
• Good infrastructure


Ahmedabad is the capital city of Gujrat. It is also counted among the top 10 largest Indian cities. It is the biggest inland industrial hub in India. If the industries are considered considering the national parameter the 2nd biggest industrial centre in India. Ahmedabad is primarily known for its textile and jewelry business. Banking is a big concern for the foreign investors when thinking of a location to set up their business in India. Ahmedabad caters to every foreign investor’s economic requirements by offering a wide spectrum of Public sector banks like Corporation Bank and Ahmedabad Dist Co Op Bank etc.
After the huge declination in the textile business of Ahmedabad in the 20th century, the flexible business policies and a rise in FDI has inspired many reputed textile mills of the city to show up with a spectacular growth in their production and mark their niche in the global textile industry. Arvind Mills one of the top denim suppliers worldwide. Apart from the banking and textile sectors, big companies like Nirma, Adani & Torrent Pharmaceuticals have their established business in the city. A positive change has been noticed in Ahmedabad’s ITES sector as well, which makes it a future IT giant. With the strong presence of trading & export, pharma, IT, Textile and banking sectors in Ahmedabad, a foreign company can definitely expect to raise its growth stakes in the city leveraging the flexible investment policies and world-class resources.

Choose Ahmedabad For –

• Multiple established sectors available like pharma, finance, banking, IT, trading and textile
• Comparatively economic space rentals and purchase
• Progressive ITES sector
• Special attention from the BJP government
• Encouraging FDI policies
One of the best things about the Indian market is that it is always ready for the innovative steps. According to the 2014 index, India was in the 6th position in the list of 110 countries that attract foreign investment every year. The government has tagged many Indian cities as smart cities to encourage FDI there. The union budget 2017 seems promising for various sectors and it is assumed that India will manage to pull more investments this year, especially in the cities like Mumbai, Delhi, Bangalore and Ahmedabad.