DELHI TECHNOLOGICAL UNIVERSITY

Fundamentals of management
(PESTLE analysis of India)
Session: 2018-19 – even Semester

Submitted to:
Ms Sakshi Kukreja

Submitted by:
Raghav Punjani

Computer Engineering(COE)

2K17/CO/249

A4
 Introduction

PESTLE Analysis in Business Environment

In business PESTLE analysis role is very important. Originally designed as

a business environmental scan, the PESTLE analysis is an analysis of the
external macro environment in which a business operates. These are
factors which are beyond the control or influence of a business, however
are important to be aware of when doing product development,
business or strategy planning.

PESTLE means:

P- Political
E- Economical
S- Social
T- Technological
L- Legal
E-Environmental

The PESTLE subject should be a clear definition of the market being

addressed, this is the followings:-

 A company looking at its market

 A product looking at its market
 A brand in relation to its market
 A local business unit or function in a business
 A strategic option, such as entering a new market
  A potential acquisition
 A potential partnership
 An investment opportunity

Now we see in details of PESTLE factors/Impact in India In next

following pages:

POLTICAL
These refer to government policy such as the degree of intervention in
the economy. What goods and services does a government want to
provide? To what extent does it believe in subsidising firms? What are its
priorities in terms of business support? Political decisions can impact on
many vital areas for business such as the education of the workforce, the
health of the nation and the quality of the infrastructure of the economy
such as the road and rail system.

India is the biggest democracy in the World. The government type is

federal republic. Based on English common law, judicial review of
legislative acts, accepts compulsory ICJ jurisdiction with reservations,
separate personal law codes apply to Muslims, Christians, and Hindus.
The political Situation in the India is more or less stable. Most of its
democratic history, the federal Government of India has been led by the
(INC) Indian National Congress. State politics dominated by several
national parties including the INC. The Bharatiya Janata Party (BJP), the
Communist Party of India (CPI), and various regional parties. In the 2009
Indian elections, the INC won the biggest number of Lok Sabha seats and
formed a government with a alliance called the United Progressive
Alliance (UPA), supported by various left-leaning parties and members
opposed to the BJP. Overall India currently has a coalition led
government and both major political parties the UPA and BJP, whichever
comes in power.

It comprises political stability and the policies of the government.

Ideological inclination of political parties, personal interest on politicians,
influence of party forums etc. create political environment. For example,
Bangalore established itself as the most important IT centre of India
mainly because of political support.

In India many poltical factors those effect in business environment.

Political pressures in ruling government and vote bank problems. These
are the major factors those affect on political environment:-

(i) Taxation policy

India has a well developed tax structure with a three-tier federal

structure, comprising the Union Government, the State Governments
and the Urban & Rural Local Bodies. The power to levy taxes and duties
are distributed among the three tiers of Governments, in accordance
with the provisions of the Indian Constitution. The main taxes/duties that
the Union Government is empowered to levy are Income Tax income,
Customs duties, Central Excise and Sales Tax and Service Tax. The
principal taxes levied by the State Governments are Sales, Stamp Duty,
State Excise, Land Revenue, and Duty on Entertainment and Tax on
Professions & Callings. The Local Bodies are empowered to levy tax on
properties, Octroi Tax on Markets and Tax/User Charges for utilities like
water supply, drainage, etc.
 (ii) Privatisation

Reduce the political interface in the management of enterprises, leading

to improved efficiency and productivity. In India this time do many govt
company Good performance but some time later there are facing many
problems so the go for privatisation.

(iii) Deregulation

India Govt makes some Act to freely do business in India.

(iv) International trade regulations

International trade regulation day by day India makes it flexi able for
foreign trade.

(v)General initiatives

Some policy to first Political initiates for the business environment in In

India.

(vi) Government stability

In India past 10 years govt is stable. Before 10 years India facing govt
stability. If govt stability not market is not improve and no one come here
for investment.

(vii)International stability
No wars, no any country home problems, and no any type of war like Iraq
they make uncertainty in market.
ECONOMICAL
It includes interest rates, taxation changes, economic growth, inflation
and exchange rates. As you will see throughout the "Foundations of
Economics" book economic change can have a major impact on a firm's
behaviour. For example:

 higher interest rates may deter investment because it costs more

to borrow
 a strong currency may make exporting more difficult because it
may raise the price in terms of foreign currency
 inflation may provoke higher wage demands from employees and
raise costs
 higher national income growth may boost demand for a firm's
products

In order to solve economic problems of our country, the government

took several steps including control by the State of certain industries,
central planning and reduced importance of the private sector. The main
objectives of India’s development plans were:

 Initiate rapid economic growth to raise the standard of living,

reduce unemployment and poverty,
 Become self-reliant and set up a strong industrial base with
emphasis on heavy and basic industries,
 Reduce inequalities of income and wealth,
 Adopt a socialist pattern of development — based on equality and
prevent exploitation of man by man,
As a part of economic reforms, the Government of India announced a
new industrial policy in July 1991,

The broad features of this policy as follows:

 The Government reduced the number of industries under

compulsory licensing to six.
 Disinvestment was carried out in case of many public sector
industrial enterprises.
 Policy towards foreign capital was liberalized. The share of foreign
equity participation was increased and in many activities 100 per
cent Foreign Direct Investment (FDI) was permitted.
 Automatic permission was now granted for technology agreements
with foreign companies.
 Foreign Investment Promotion Board (FIPB) was set up to promote
and channelise foreign investment in India.

The economic factors in India are improving continuously. The GDP

(Purchasing Power Parity) is estimated at about 3.965 trillion U.S. dollars
in the year 2009. The GDP- real growth rate in 2009 was 6%. India has
the third highest GDP in terms of purchasing power parity just ahead
Japan and behind U.S. and China. Foreign direct investment rose in the
fiscal year ended September 2009 to about US$ 10.532 billion. There is a
continuous growth in per capita income; India’s per capita income is
expected to reach Rs. 33283 by the end of 2009-2010. This will lead to
higher buying power in the Hands of the Indian consumers. India GDP is
now 6.5. Today India reserve Us dollor in Good condition.

In Indian economy is strong. We see in recession our economy is less

affect from recession compression to western countries. These following
factors:
(i) Interest rates

(ii) Money supply

(iii) Credit control

(iv) Financial markets

(v) Inflation

(vi) Competitors pricing

(vii) Globalization
SOCIAL
Changes in social trends can impact on the demand for a firm's products
and the availability and willingness of individuals to work. In the India,
for example, the population has been ageing. This has increased the
costs for firms who are committed to pension payments for their
employees because their staff are living longer. It also means some firms
have started to recruit older employees to tap into this growing labour
pool.

It describes the characteristics of the society in which the organization

exists. Literacy rate, customs, values, beliefs, lifestyle, demographic
features and mobility of population are part o the social environment. It
is important for managers to notice the direction in which the society is
moving and formulate progressive policies according to the changing
social scenario

India is the second most populous nation in the world with an

approximate population of over 1.1billion people. This population is
divided in the following age structure: 0-14 years – 31.8%, 15-64 years –
63.1% and 65 years and above – 5.1%. There has a

(i)Mobility

(ii)Income distribution

(iii)Population demographics

(iv)Attitude to work and leisure

(v)Standard of education and skills

(vi)Working conditions
TECHNOLOGICAL
New technologies create new products and new processes. MP3 players,
computer games, online gambling and high definition TVs are all new
markets created by technological advances. Online shopping, bar coding
and computer aided design are all improvements to the way we do
business as a result of better technology. Technology can reduce costs,
improve quality and lead to innovation. These developments can benefit
consumers as well as the organisations providing the products. Today in
India 3G technology starts. A heavy infrastructure for bandwidth. BSNL
and Reliance have more covered city by optical fibre. India have many
Technological Projects. Good Service provider in IT sector ex TCS, Infosys
and many more.Today India is a big market in mobile sector here 5-6
player operataors and new operators launch their services soon.

(i) IT Development

(ii)New Materials and processes

(iii)Government technology funding
(iv)Speed of technology transfer
(v)Software upgrades
LEGAL
These are related to the legal environment in which firms operate. In
recent years in the India There have been many significant legal changes
that have affected firms' behaviour. The introduction of discrimination
and disability discrimination legislation, an increase in the minimum
wage and greater requirements for firms to recycle are examples of
relatively recent laws that affect an organisation's actions. Legal changes
can affect a firm's costs and demand.

This consists of legislation that is passed by the parliament and state

legislatures. Examples of such legislation specifically aimed at business
operations include the Trade mark Act 1969, Essential Commodities Act
1955, Standards of Weights and Measures Act 1969 and Consumer
Protection Act 196.

In India take many type of permission to the sate govt or central govt.

In India many type of act like license permission, copyright permission,

and many types of other permission.

(i)Employment law

(ii)Trade and product restrictions

(iii)Health and safety regulations

(iv)EU and international laws

(v)Monopolies commission
ENVIORNMENTAL
Environmental factors include the weather and climate change. Changes
in temperature can impact on many industries including farming, tourism
and insurance. With major climate changes occurring due to global
warming and with greater environmental awareness this external factor
is becoming a significant issue for firms to consider. The growing desire
to protect the environment is having an impact on many industries such
as the travel and transportation industries (for example, more taxes
being placed on air travel and the success of hybrid cars) and the general
move towards more environmentally friendly products and processes is
affecting demand patterns and creating business opportunities.

In India we know that many types of enviormental problems this are

basic things but more important for our enviorment. also biotic factors
,abiotic factors and their interaction with one another. pollution free
industrial activity i.e is nessary condition of industrial organization.

Industrialization and urbanization have resulted in a profound

deterioration of India's air quality. Of the 3 million premature deaths in
the world that occur each year due to outdoor and indoor air pollution,
the highest number are assessed to occur in India.

(i)Pollution problems
(ii)Planning permissions
(iii)Waste disposal
(iv)Noise controls
(v)Environmental pressure groups
CONCLUSTION

The PESTLE analysis here shows what is a factor in India who relates to
the Business. This study is more and more beneficial for any business
organization. In the report given detail of our India political, social
economical, legal, environmental and technological. This all the issue of
India market stability, government politic. Political stability in India. And
many other things show this. We say that PESTlE analysis role is in today
scenario in business very important. We see here India PESTLE analysis.
In India many opportunity to open a business. Some problems in India
But we Know every where every things is not available.