Exporting to India - 101

India presents a lucrative opportunity for New Zealand exporters.

The needs of its billion plus population and sustained 8% growth are fuelling insatiable demand, not just for commodities, but also in key sectors such as energy, infrastructure, transportation, education, healthcare, food and beverages and consumer goods.

New Zealand is only just beginning to discover this opportunity.

Although New Zealand exports to India have more than trebled since 2003, we are only exporting about a fifth of the value of goods to India that we are to China.

There are good reasons to believe that we can do much better.

• Since the early 1990s India has progressively lowered trade barriers. Quantitative restrictions in imports have been abolished and average tariffs on non-agricultural items have fallen below 15%.

India's growing openness is signalled by its participation in multilateral trade negotiations, where it is a leader among developing nations, and in recent free trade/economic partnership agreements with ASEAN, Korea and Singapore.

New Zealand and India are now negotiating a free trade agreement that will provide a major boost to bilateral trade.

• India's growing middle class - estimated at 300 million people - are avid and sophisticated consumers.

Compared to other developing Asian economies, private consumption has always comprised a relatively high proportion of GDP in India.

Indian consumers are brand and quality conscious and very open to Western fashions and tastes. McKinsey and Company estimates that India's consumer market, currently worth USD 511 billion, will quadruple by 2025.

For New Zealand exporters looking to break into the Indian market it's critical to do your homework. India is a highly diverse country - linguistically, regionally and culturally.

For instance, the main official language, Hindi, is the primary tongue of only about 30% of Indians - and there are 28 other languages more than 1 million native speakers.

On the one hand this means that English is widely used as a lingua franca; on the other, a business partner with deep connections in one region of the country may not have such strong networks elsewhere. Consumer tastes will also reflect this regional diversity.

It may make sense to target a particular part of the country - Chennai in the south is a very different market from Delhi in the north or Mumbai in the west.

Although India has a formidable reputation for red tape, with good planning, a little patience and flexibility, and - most importantly - local knowledge you can overcome these obstacles.

When you're ready to try India you will need to consider:

1. Gather market insight and intelligence on the demand and competitive landscape for you product in India.

2. Identify your target your market: the best location for your business, and the key market segments you want to address

3. Plan your market entry strategy.

4. Decide the best way to establish a presence in India and identify local partners.

5. Understand import and regulatory requirements

India Horizonz has the knowledge and experience to guide you and take the guesswork out of venturing into India and support you while you are there.

 

Considering exporting to India? Contact us.