A week in Mumbai and Delhi is all you need to remind you of India's natural and somewhat understated advantages for business and investment - its young and vibrant population, the breadth and depth of its economy, the diversity of its workforce, the booming domestic consumption story, and its high growth rate - its economy is now growing at an annual rate of close to 9% per annum and expected to rise further in the years ahead.
India's markets offer opportunities across the board for entrepreneurs, exporters and investors. Virtually every sector of the market is booming, and its emerging and aspirational middle class should be a target for everyone looking for growth opportunities.
My views on the case for India were fully documented in the August issue of Insights (click here to read it) but here are some more thoughts and ideas emerging from my most recent visit last week on our latest BRIC+ Study Tour India:
- The BPO (Business Process Outsourcing) Sector is booming and predicted to become a “mammoth” industry. According to McKinsey, the addressable market for global sourcing will triple in size from US$500 billion today to US$1.5 trillion in 2020. However, whilst this alone is an astonishing prediction, even more amazing is the view that 80% of this incremental growth will be driven by opportunities which fall outside the current core markets, verticals and customer segments. In other words, the global trend for outsourcing automated processes has only just begun! It won’t be long before all processing, origination, applications, documentation, technical support and back office systems will be carried out in India (and China). Have you ever wondered how this will affect your business? An opportunity or a threat?
- India is the fastest growing telecom market in the world, with 700 million mobile connections and 10-15 million new mobile subscribers being added every month. PC sales have increased from 3 million units in 2004 to 8 million units in 2010 (an annual growth rate of 17%) and there are now 16 million internet users, including 9 million broadband subscribers, a figure which is projected to increase to 275 million in the next 5 years. India’s 500 million middle class consumers are now amongst the most wired and interactive in the world – this should make it easier to reach them!
- The plans and funds set aside to upgrade India’s infrastructure, an area which has undoubtedly held India back so far, are serious, significant and substantial. Over US$1 trillion is expected to be spent in this area in the current 5 year plan, and this will be sourced from a combination of public, private and foreign funds. Whilst there is still a long way to go, there are already signs of significant progress. Delhi Airport now rivals any international airport in the world (servicing 500 million passengers per annum) and the new Bandra-Worli Sea Link Bridge in Mumbai saves literally hours of travel time for local entrepreneurs who need to get around the city. It won’t be long before India’s major cities and transport hubs will match the requirements of a country striving to top an annual growth rate of 10% per annum. Having first visited India in 1978, and witnessed only minor physical changes in the past 30 years, I will soon be able to report on an extraordinary transformation…a truly modern economy taking its place amongst the other Big Rapidly Industrialising Countries (BRICs) of the world.
Don’t be fooled or distracted by what you may read in the press or what you see on the streets. India's best years are ahead of it. By the end of this decade, India will be one of the three largest economies in the world. There are opportunities for everyone. You’ll be hearing a lot more from me on this!