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Indian Firms Shift to Proactive Compliance
11 Feb
Summary
- Compliance is now central to Indian corporate strategy and planning.
- Regulatory complexity directly impacts costs, market access, and competitiveness.
- Companies move from reactive stances to preventive vigilance models.
Indian businesses are increasingly integrating compliance into their core strategies, transforming from reactive approaches to proactive vigilance. This shift is driven by escalating regulatory complexity, mandatory reporting, and the significant risk of penalties, which now dictate market access and competitiveness.
Tata Steel, with operations across India, the UK, EU, and Canada, recently highlighted these regulatory impacts. The company absorbed €150 million in carbon emission costs and €50 million from US tariffs in its Netherlands operations. This demonstrates how policy significantly weighs on profitability, as these costs reduced potential operating profit.
Smaller companies like Jyoti Steel Industries also face similar challenges. The rapid evolution of rules often necessitates reliance on customer intelligence for navigation. For instance, a customer revealed Japanese steel was cheaper than Indian steel due to trade arrangements, underscoring the critical need to understand and incorporate regulations into daily business.
