Indian business leaders count on Germany

Germany seems to be India's new darling: When businesses from the sub-continent decide where to set up shop in the EU, Germany is top of the list. Cities like Duesseldorf and Cologne, the two leading cities in the federal state of North Rhine-Westphalia, are eager to show investors from India that they are most welcome. They have promised that Indian businessmen never have to wait longer than four weeks to obtain residence and work permits.

This policy seems to have paid off. About 100 Indian companies are based in Germany's most populous state. 90 percent of these have been acquired in recent years from German owners. Tapan Chattopadhyay, the head of the Indian business delegation, says that Germany with its state-of-the-art technology can help Indian companies enormously "In fact a lot of Indian companies have invested in Germany. To be precise: Tata and other leading industrialists have opted for Germany," he explains.

German-Indian technology transfer

For the last 15 years India's industry has been contributing 17 percent to the country's gross domestic product. In order to increase this share, the country is partnering with key industrial nations around the world.

But there is another reason why Indian politicians and business leaders are especially attracted to Europe's largest economic power. Apart from the technology transfer Germany can help Indian companies in upgrading knowledge. "In India, because a large slice of the population is between 20 to 30, there is a great scope of upgrading their technological skills," says Tapan Chattopadhyay, "it may be in the field of agriculture, it may be in the field of services, in the field of engineering. And also clean technology, green technology, which India has been striving to adopt."

Upgrading skills

Outstanding vocational training is the key to Germany's success in today's globalized economy, the Indian entrepreneurs and decision-makers visiting Germany kept repeating. According to Indian government figures, only 25 percent of the Indian workforce is trained.

Dirk Matter, Duesseldorf representative of the Indo-German Chamber of Commerce, thinks both countries will benefit when they ramp up their trade relations. For example, when India's famous low-cost car, the Tata Nano, was developed, 35 German suppliers and technology partners were involved. And they make money on each unit sold.

India emerging economic world power

According to Matter, people in Germany should take India seriously as an emerging economic world power. But he adds that they should not panic when Indian companies take over German firms.

"Due to the global financial crisis, many German companies were undervalued in 2009. And Indian businessmen were clever enough to take the opportunity and buy into the German industrial sector. Not to outsource and off-shore production, nor to cut back on jobs. But to get access to German technology, to understand our marketing strategies."

Excluding oil imports from Arab countries, Germany already ranks third behind China and the US amongst India’s most important suppliers. But the fact that India is only number 26 among Germany’s trade partners has to be changed.

Author: Thomas Kohlmann

Editor: Grahame Lucas