|
People at every level of Indian society are enjoying an increase in wealth and purchasing patterns are changing fast. This translates into an everevolving set of business opportunities-in meeting domestic demand, manufacturing for export, or engaging with government. India's best-known success story has been the rise of its call center or BPO sector. If you are looking to outsource company services, India offers considerable cost benefits together with a highly educated, English-speaking labor force. Increasingly it can also offer a faster speed to market. The BPO sector is developing rapidly: although initial contracts were based around low-end, non-core activities, such as customer support services, BPOs are moving up the value chain. Consider outsourcing to India if you are looking to outsource knowledge processing research, finance, insurance, accounting, marketing or legal services, or infrastructure technology-network or systems management and asset management.
The newest areas include software development and computer animation. The speed and scope of India's development has led to soaring demand for steel, leading the country's industry to expand even faster than in the rest of the world, where it is growing rapidly. India is an underdeveloped steel market with great potential: the Indian Ministry of Steel envisages a demand of 90 million tons by 2020. There are opportunities for companies to build steelworks, as POSCO is doing in Orissa, or to contribute to their construction. If your company is involved in engineering, there are opportunities within the mechanical, metallurgical, industrial, electrical, and civil fields. The government is also eager to source foreign investment: it allows 100 percent FDI for metallurgy and processing under the simpler, quicker automatic route.
Telecom is another of India's big success stories, and there is still room to be a part of it. Every year 10 million new subscribers in India are tempted by cheap call charges and new payment services, and the market is set to grow-the mobile phone remains most people's primary point of connectivity, rather than PCs. If your business lies in phone sales, bear in mind that although the market is huge, it is uniquely demanding: Reliance proved successful by selling cheap, affordable handsets to India's lower middle classes and poorer workers. There are still considerable opportunities for content providers, as these services are in high demand, especially those focusing on Bollywood music. The Indian growth story has highlighted its poor infrastructure.
Billions of dollars are now being poured into new airports, ports, roads, pipelines, rail improvements, power stations, and water-treatment plants, and this work is open to foreign firms. Opportunities are best for larger companies that have the experience, skills, and technology to manage big projects, such as the greenfield development of airports. There are prime opportunities for engineering and construction firms in almost every part of the country. If you are looking to buy or start a construction business in India you will also benefit from the government's desire to increase foreign participation: it allows 100 percent foreign-equity participation in the construction industry. Electricity is arguably India's most exciting investment prospect. The country plans to bridge a 15 percent shortfall in supply by 2012 by building "ultra-mega power plants" around the country, and by buying up oil and gas concessions around the world to fuel them. India does not allow private utilities to generate nuclear power, but there are opportunities for firms to supply equipment: General Electric and Areva were bidding for contracts worth several US$ billion in 2008.
The government is eager to promote investment in power plants, coal plants, natural gas processing plants, and renovation and modernization of existing thermal and hydro power plants. Many opportunities exist for engineering or consulting within the transmission and distribution sectors. India's IT industry is world class. By the start of the 21st century it had grown into a global leader worth more than US$50 billion, expanding at triple the national growth rate. Multinationals have been quick to see the opportunities, investing over US$10 billion in 2006-2007: growth of over 20 percent a year continues to make this sector very attractive. If you want to set up an IT business in India, consider siting it in a SEZ or Software Technology Park to take advantage of tax exemptions for foreign companies, well-qualified employees, and well-above-average infrastructure.
If you're looking for a partner to develop software, an Indian company is worth considering- IT companies have proven that they are able to innovate and invent as well as trade. India's property markets are increasing in value. Demand is growing, fueled by the presence of non-Indian firms, the globalization of larger Indian corporations, and the increasing wealth of the domestic market. Demand for property outstrips supply across all segments, and there are wide opportunities whether your business lies in residential, commercial, retail, or hospitality assets. Changing markets are leading to new opportunities: commercial spaces are shifting from sale to lease-and-maintain models, mortgage financing is penetrating widely across urban areas, the luxury housing segment is expanding at around 25 percent a year, and the entry of international players is heating up the retail market.
The Indian pharmaceutical industry is the fourth largest in the world, and one of the fastest growing. By 2010 its domestic market is expected to be worth US$10 billion, with exports at around US$18 billion. International players, such as Pfizer and Glaxo SmithKline, and bio-agriculture companies Monsanto and Aventis, have already opened offices in India to take advantage of the many domestic and export opportunities. If your business operates in this sector, an Indian arm of the company would allow you to benefit from the availability of lowcost, high-quality production; low research costs; access to research scientists at around a quarter of the costs of those in the West; and world-class testing facilities.