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INDIA is set to announce the results of its prime ministerial election today, with all signs pointing towards a victory for Australian business.
Narendra Modi of the Bharatiya Janata Party is on track to become the new Prime Minister with the results due to be confimed today.
According to BDO Australia executive director of international business Cameron MacMillan (pictured), the predicted change in government will be business-friendly.The accounting and advisory firm co-hosted a series of discussions about business in India starting in Brisbane last week.
The boardroom briefings featured guest speakers from Austrade and market entry experts Sannam S4, discussing the challenges and growth potential in light of a change in government.Macmillan later spoke to Brisbane Business News about the potential opportunities for local companies.
“This is one of the largest and longest elections in history, with roughly 815 million voters.“There are early indications that the change in government will be business-friendly and will try address the challenges of this large population by looking internationally,” he says.
He says India is often overshadowed by other markets in Asia, particularly China.,/p>
With a population of more than 1.2 billion people and growing middle class, he says the country is turning to western influences to develop.
“A really interesting statistic to come out is by 2050 there will be 1.6 billion people in India, potentially the largest population on the globe.“Over 50 per cent of the population is under 25 years of age and over 65 per cent is under 35 years of age. As opposed to a lot of other markets in Asia and traditional European markets, you have this very large young population.”
He says the younger generation looks to the world to fill demand for technology and services, with Australia’s educational exports to India sitting at around $1.6 billion.“That is Australia providing educational services to the Indian population here in Australia principally, but the future will be more about delivering those services back in India.
“Not everyone can afford to go to another country to learn a skill, language or qualification. More and more we will see Australian education and training going to India – rather than waiting for the Indian population to come to us.”
Macmillan says Austrade outlined numerous Australian industries making their mark in India, including infrastructure, waste water management, power generation, road safety, mining, aged care and even sport.
He says a notable opportunity is within the food and beverage industry, with growth in exports for pork, lamb, goat and dairy.“Despite quite a high tariff there’s also an increase in the market for wine, along with proposals for jam, cheese, honey and pasta.
“We grow food like no one else and can assist a country like India increase its production of agricultural produce.“Australian exports to India are around 11 billion dollars at the moment and we import a lot of production from India as well. These are long term markets and we are just working towards making them even better.”
Macmillan concedes the Indian market isn’t without its challenges and warns businesses to do the appropriate research, before being blinded with the massive potential consumer base and low cost capabilities.He says businesses face the threat corruption and a complex banking system, where “92 per cent of transactions” are cash-based.
“It’s a very different to the way we operate in Australia. This is why BDO strongly encourages anyone considering the market to do as much homework as you possibly can.“Do twice as much research as you think you need to, then go and visit and try to understand the market and how your business is going to enter it.
“We are blessed with the government assistance we get, use it all and then go and attack the market.”Get our daily business news
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