India is primarily of interest because of the exceptional size of its market and its population pyramid, which defies the trend observed in the West. Its current population of 1.2 billion inhabitants includes 502 million who are of working age, making it the world’s second largest pool of workers after China. Indian labour is renowned for its managerial skills, negotiation techniques, command of the English language, and cost, which remains even more advantageous than in China. India has the largest pool of Anglophone scientists and engineers in the world.
Poverty is in relatively rapid decline, while the middle class and school enrolment rate are constantly on the rise, which is contributing to improving Indian purchasing power. In addition, according to Merrill Lynch, close to 100,000 individuals now make up the Indian upper class, which is growing at a rate of 20.5%, the second most substantial growth rate in the world.
Beyond its demographics, India has also been boasting strong economic growth of between 7 and 10% since the government of Narasimha Rao undertook a process of economic liberalization in 1991. In 2001, this climb was crystallized in the establishment of the now famous BRICS group, which keeps us informed about emerging economies to keep an eye on. Today, India has the world’s fourth highest GDP. Global Affairs Canada considers it to be a priority market, and it is a market of choice for Canada Economic Development (CED). By 2030, it is estimated that India will become the world’s third largest economy, right behind the United States and China.
International trade is important in India: it generates 50% of India’s GDP and is growing twice as fast. India’s main imports include mining products, electrical equipment, chemical products, and medical instruments. Canada currently exports vegetable products, metals, minerals, chemical products, paper, machinery, and transportation material to India.
For the current year, we anticipate a rate of growth of about 7% due to recent political reforms and the fall in oil prices. It is also believed that the country is ready to deal with exchange rate volatility despite current US interest rates. A public policy review and the simplification of approval processes are helping to promote investment, decongesting the infrastructure sector, and reducing the cost of business in general.
In brief, India offers excellent opportunities for Quebec companies that are ready to take certain risks. There are many remaining barriers to trade, as India’s 130th position on the World Bank’s Ease of Doing Business index clearly demonstrates. In fact, the lack of political support and the weakness of structural reforms in the areas of taxation, property ownership, and labour law are serious obstacles to doing business on Indian soil. Lastly, the political violence in the country’s Southern and North Eastern states is also worrisome to international merchants. This year, a poor harvest and stagnant external demand have slowed economic growth to a certain degree.
India is a vast country, and businesses seeking to expand onto the market must wisely target their location. India’s economic epicentres are without a doubt Mumbai, located on the west coast, and the capital, New Delhi, in the north. However, certain southern regions, like Tamil Nadu, Karnataka, and Andhra Pradesh, are also developing rapidly. In fact, the Government of Canada opened a consulate general in Bangalore in April of 2015 to better serve the territory.
India, facts and figures:
- A population of 1.2 billion inhabitants
- The world’s 4th largest economy (2015), behind the United States and ahead of Japan
- A GDP of 2.20 trillion Canadian dollars
- Canadian exports amounting to $4.3 billion in 2015
- Quebec exports amounting to $659 million in 2015
WHO SHOULD ATTEND?
- Entrepreneurs seeking to expand onto the Indian market or already established on the market but wanting to learn more about its potential.
- The activity will be of particular interest to businesses in the following sectors:
- Automobiles and trucks
- Construction and infrastructure
- Environmental infrastructure and wastewater
- Oil and natural gas
- Health care
- Information and communications technology
- Renewable energy
Position your company on this key market.