When I entered Ghilot in the state of Rajasthan, two-hour drive from Indian capital New Delhi on November 2, a super large-scale green signboard of 'exclusive Korean industrial zone' caught my eyes. The Korean zone covering 1 million square meters (approximately 300,000 pyeong) has been set up as a zone dedicated to Korean companies as its name implies.

Rajasthan State Industrial Development and Investment Corporation (RIICO) signed a MOU with Korea Trade-Investment Promotion Agency (KOTRA) in March 2013 and then began groundwork for the exclusive Korean industrial zone. Currently, basic construction work for the zone, including transmission tower and waterworks construction, has been completed. The industrial zone has received applications from Korean companies which have interest in the zone since March 2015 and such companies will enter the zone in earnest from next year.

Deregulation leads to a flood of investment from overseas companies

India has undergone rapid change since Prime Minister NarendraModi took office in September 2014. Under a slogan 'Make in India.' he has sought to revitalize the country's economy through the innovation of its manufacturing industry and regulatory reform. 'Make in India' is Prime MinisterModi's project for economic development with the aim of reinvigorating the manufacturing industry by attracting manufacturing plants of overseas companies to India.

Under the strong leadership of Prime Minister Modi, who has visited several countries to boost investment in India, each local government in India is exerting concerted efforts to attract investment from foreign companies by stressing a variety of regulatory reform policies. State governments are seeking to lure investment by placing advertisements in morning newspapers. In addition, name cards of public officials contain promotional slogans, such as 'Make in Telangana' and 'Make in Karnataka', which are modeled after 'Make in India.'

Among them, the State of Rajasthan formulated a strategy to create industrial zones dedicated to foreign companies of specific countries through the consultation with the foreign governments concerned. The state set up Korean industrial zone by emulating Japanese Industrial zone located in Neemrana. RIICO set up its first industrial zone for foreign companies in collaboration with Japan in 2007. In fact, it was the first experimental foreign direct investment in India. RIICO came up with drastic polices to boost investment as it provided land space to firms that entered the zone by giving a 50% discount on rental fees and offering tax benefits to them. Given that India's unstable power and water supply situation, the state government promised to guarantee substations, gas and water supply facilities, and others. In addition, the government streamlined complicated administrative procedures of India.

Thanks to such efforts, the first Japanese zone in Rajastha, which marks its eighth ceremony this year, houses 45 companies, such as Toyota and Daikin, which have operated production lines. In the industrial zone, there are Japanese restaurants, hotels, and shops for Japanese. Until now, Japanese firms have invested $700 million (approximately 810 billion won) in Neemrana, which has not only created jobs in Rajastha, but also greatly raised the technical standard of Indian suppliers in nearby industrial zones dedicated to Indian firms.

"After lying down, India now sits up"

In the separate Telangana state which came into being in 2014, the winds of regulatory reform towards change were felt more strongly. The state of Telangana introduced 'Single Window Service' aimed at easing foreign companies' burden related to the submission of documents. In the past, foreign companies which hoped to make an investment had to approach various departments to secure approvals. However, they are now able to obtain approval within two weeks after submitting an application online to a single department.
Commissioner of Industries Manicka Raj said that "The state of Telangana has received a flood of inquires from global firms such as Google, Wal-Mart, and Amazon centering around the state's capital Hyderabad since it declared a variety of business-friendly policies including infrastructure expansion and discounts on rental fees," adding "We expect that 250 companies at home and abroad would create about 50,000 new jobs."

According to the state of Telangana, Google has operated its biggest R&D center in Hyderabad, outside of the U.S., and will employ 13,000 people by 2019. Uber also will invest $50 million in Hyderabad to establish its biggest campus, and IKEA and Wal-Mart also selected the city as their first investment destination in India. A rise in companies that have made investments in the state of Telangana has formed a virtuous cycle that results in an increase in young people who have moved into the area to find a job. The state of Telangana is one of the youngest states in India as 47.89 percent of its population is 29 years old and under.

The winds of change in India began centering around India's central government, but it is true that some entrepreneurs still have doubts about the change. An official of a company said that "Although changes are being made to carry out administrative procedures online, companies still have to pay express charge to public servants in order to complete the process in a timely manner."

YeonGyu-deuk, Professor of Dept. of Economics at Christ University of India said that "After lying down for a long time, a big elephant of India now sits up," adding "It is difficult to expect a drastic change at a time as it is a huge country, but the country has taken its first step towards change and therefore Korean companies should make the most use of the country's move towards such regulatory reform."