Global businesses continue to perceive India as a partner of choice. A burgeoning population and rising demand balance out multiple challenges including a lower than expected GDP, endemic corruption and bureaucracy. What makes India so attractive?
“Already, there are several international companies successfully operating out of India. India’s trade with all ASEAN counties has increased and Indians are actively seeking opportunities to source the right products and knowledge,” says, Subhas DeGamia, CEO, ANZ India.
“Investors need to look for good business partners and have clarity about the area in which they want to invest. Once you have a trusted partner and have a common vision, it is a sure-footed way of doing business in India, and can mean faster speed to market.” India is New Zealand’s seventh largest market and the trade between the two countries is worth 1.3 billion a year. The Free Trade Agreement will boost this figure significantly. If there is a fault-line at all on which the agreement sits, it would be the high tariffs on certain imported products into India. Especially as agriculture is a natural trade fit with New Zealand’s reputation of producing high-quality agri-products and the rising demand in the Indian the food and beverage sector. However, there are other potentially profitable sectors that are presently under-explored by Kiwi businesses like education, adventure and recreation and clean energy technology
The interest of NZ businesses is on the rise, but preparation is vital for success as is committing resources – people, time and money – for market entry into India. Companies can typically expect three to five years to get serious market traction.
“NZ companies willing to take the time to understand the market and build relationships in advance of an FTA will be best placed to profit from improved access when this happens,” says Richard White, Trade Commissioner in New Delhi. “Making extensive use of the network of persons of Indian origin, either through the India New Zealand Business Council or other cultural organisations is another good approach - solid networks back in India can be leveraged and capitalised upon.”
Subhas DeGamia, CEO, ANZ India offers insight, context and perspective on doing business in India.
Q. India is a top export market for NZ. What sectors remain untapped?
There is a clear opportunity in the food and bevarage sector and technology transfer. Education is an underrated sector. India is an important source country for students, however, there is a vast number of students interested in good quality education locally. Recreation, adventure sports is a sector that NZ has expertise in and this is something that Indians are seeking. I see NZ businesses profiting tremendously if they look at these sectors.
Q. What is the current climate in India for foreign partnerships and does NZ have tough competition?
Indian businesses are actively seeking business opportunities, source countries with the right products or knowledge. There is enough room for NZ companies, especially in key sectors where NZ has an edge over other countries. Investors need to look for good business partners and it is vital to know clearly and stick to core competence.
Q. Compared to the other established banks in India, what are the advantages that ANZ brings?
For companies looking to grow their presence in the Asian Pacific region, ANZ brings significant and deep insight. We know the region well considering we’re in 28 markets in the Asia Pacific region and we forge long-term relationships. We can effectively connect interested investors and businesses and help in the functional aspects of setting up business to long term investment support.
What can governments of both countries do to strengthened trade ties?
Both governments are already doing good work and working towards the FTA is the right track. Once successful, it will inject tremendous enthusiasm and excitement in the NZ-India trade relationship.
Anything that businesses need to specifically consider before venturing into India?
Indian market needs to be perceived as a long term opportunity. There are complexities, as in any other new market, but nothing insurmountable. India has its unique way of doing business.
I often use the term super granular – you have to have clarity about what you’re bringing to the market and who you want to market it too. Being picky and focused about consumer markets instead of a pan India perspective is vital to success. It pays off to pick the right people locally.
DeGamia was recently spoke a seminar `Building Relationships & Understanding Complexities’ hosted by the India-NZ Business Council and supported by NZTE in Auckland.