• Bureaucracy and red tape.• Lack of stability in the central government, and therefore a slow down of reform and policy-making. • Infrastructure: Availability of basic infrastructural needs for any project, like power, water and access are not consistent, and infrastructure often needs to be developed at the project promoter’s cost.• Rampant corruption, despite government policies to streamline and speed up procedures, including single-window clearance.• Commercial Law and Government regulations: Indian company law has undergone a number of significant changes in 1999, supposedly paving for smoother inflow of FDI. The Companies (Amendment) Act of 1999 allowed Indian companies for the first time to buy back their shares and substantially relaxed the restrictions on inter-corporate loans and investments.• Multiple taxes: India has a complex tax structure that varies from state to state, resulting in double taxation at times. Sectors like hospitality are taxed at 35% as against 10-15% in other countries in the Asia-Pacific region.FDI for the hospitality sector in India has been a profitable venture for all comers, with the sector currently suffering from a shortfall of 130000 rooms. . Global Economic Perspectives.
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