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A global survey has ranked India as the 4th most attractive investment country
and while it showed a diminishing interest in call centers in India without
suggesting reasons for the decline, it was still the most preferred location
for call centre and back office activities. Ernst and Young’s European
Attractiveness Survey 2006 says that the US and China continue to be the top
two locations for international decision makers.
The survey said that "India's rating in 2006 is on par with the previous year"
suggesting that while the country has maintained its position from last year,
it still lags behind China in attracting foreign direct investment (FDI).
China has achieved the lead position for manufacturing operations and India has
emerged the top country for call centers and back office functions.
Local studies have shown that increased real estate costs, increased taxation,
political demands, lack of infrastructure, and lack of political support to
take the Information Technology (IT) Enhanced Services (ITES) is affecting
fresh inflow of FDI and even triggering outflow. Apple recently aborted its
operations in Bangalore citing these reasons even as International Business
Machines (IBM) promised a USD 6 billion investment. Siemens, Infosys, Wipro, a
semiconductor fabrication consortium, Dell, etc have disclosed expansion plans
that does not include Bangalore. The previous Karnataka Government was openly
hostile to IT and ran the infrastructure into the ground. The present
Government has done much but has not worsened the situation yet.
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