Despite slowdown in Europe, Indian companies growing there: FICCI
Despite slowdown in Europe, Indian companies growing there: FICCINew Delhi, Aug 19 (KNN) Despite the slowdown in Europe, Indian companies have been able to grow and create a niche for their products in Europe, said a FICCI survey.
“Despite the on-going gloomy economic scenario in Greece, Spain, Italy and more recently, recessions setting in major economies like France, Indian companies have overwhelmingly expressed optimism that the worst is over for them while engaging the region commercially,” said a Federation of Indian Chambers of Commerce and industry (FICCI) survey.
There has been a marked rise in the number of companies who have successfully been able to reduce their losses while doing business in the region, says the survey titled, ‘Is the Worst Phase over for Indian Companies Doing Business in Europe?’
Indian entrepreneurial zeal is looking towards transforming the adverse economic situation to its advantage. This has resulted in ever-increasing interactions and joint ventures with the European companies.
The SME sector in India has also played a pivotal role in forging new business alliances with European companies. It has acquired the needed technologies and operational expertise to become globally competitive. The skill upgrades and development have only added due momentum to the growing synergies between Indian and European enterprises.
Last year, 75 per cent of companies had responded that the ongoing crisis had resulted in their business prospects in the region being adversely impacted. This year, however, a little over 50 per cent noted that even when the markets slowed, they were able to register growth in their product category.
Half the surveyed companies expected the current economic situation to improve over the next two years. About 30 per cent expressed optimism that the economic situation in the European Union (EU) would begin to look up in a year. To keep their balance sheets stable, 50 per cent of the companies surveyed had already begun to diversify their markets within Europe. Last year, 40 per cent of these companies initiated efforts to make inroads into the Central and East European markets.
Nearly 60 per cent of these firms are primarily focusing on greener pastures in African countries, West Asia, South Asia and even in North America.
About 20 per cent of respondents pointed out that instead of facilitating foreign investments and businesses during the current economic turmoil, the respective European governments had made the processes more stringent in obtaining and renewing long-term visas, work permits, family and dependent visas and overall ease of doing business.
About 10 per cent suggested that the Indian government could favourably look at providing subsidies and lower duties for promoting India-EU trade. To maximise their benefits and to alleviate business losses in terms of reduced demands in European markets, Indian manufacturers are aggressively pursuing new business plans. These include increased imports of high-end machinery and technology from Europe, due to highly competitive prices being offered by European exporters.
These are heartening signs for Indian corporates as despite a gradual slowdown in India Europe trade and economic relations, the region still remains India’s largest trading partner.
The on-going negotiations to sign an equitable and balanced FTA between India and the EU are also closely monitored by the Indian industry. The issue of visas and movement of professionals in the EU still remains one of the most contentious concern areas for Indian companies.
To maximize their benefits and to alleviate their business losses in terms of reduced demands in European markets, Indian manufacturers are aggressively pursuing new business plans. This includes increased imports of high-end machinery and technology from Europe due to highly competitive prices being offered by European exporters. (KNN/SD)