Journal Press India^®

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Formal and informal institutions hold a significant importance in an emerging economy like India which is seeking to grab a stronger global position by enhancing its trade, FDI and GDP. This paper tries to identify various elements of formal and informal institutions and then analyse the evolution of overall institutional environment in India in terms of these elements. Legal, political and economic institutions have been studied as a part of formal institutions, while religion, culture and corruption as parts of informal institutions. The analysis shows that although the Indian regulatory environment is now much more conducive to business activities and foreign investors, there remain continuing problems with the bureaucracy, judicial system, corruption, crime and violence.

Keywords

Culture; Economic; Formal institutions; Informal institutions; Legal; Political; India

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