Ethical business cultures in the emerging markets are shaped by historical, geopolitical, and socioeconomic contextual factors. India, as one of the fastest-growing global economic powers, is not an exception to this phenomenon. Liberated from the British Raj in the year 1947, India adopted a multiparty political system that is democratic in nature. The end of the colonial era saw the disappearance of the recurring famines and economic depression that were endemic to India, and the country began to witness phenomenal growth of its economy. As the world’s largest democracy and second most populous country, India emerged as a major world power in the 1990s.

With a population of more than one billion people and one of the largest economies in the world, India’s purchasing power GDP was an estimated US$7.277 trillion in 2014 (Central Intelligence Agency, 2014). After adopting the framework of democratic socialism in the post-independence era and, later, policies of liberalization and expansion on global markets, India is moving toward democratic capitalism, integrating both public sector and private sector business perspectives.

In this chapter, we explore the major macroeconomic, sociopolitical, and cultural factors that influence the current business climate in India. We show that religious beliefs and ancient philosophical systems of India have a profound effect on the way business is done and how business behavior is perceived ethically. The changing role of Indian government, regulatory environment, and managerial leadership culture in the emerging economy is discussed. We examine the historical development of Indian business ethics and present a unique indigenous paradigm of ethics that guide business leaders in engaging in successful organizational ethical practices and avoiding the pitfalls of corporate wrongdoing. Practical implications are presented for business professionals and leaders from other countries and/or Indian companies operating globally.