Doing business in India

Doing business in India requires patience, research and a long term strategy. Indians want to do business with people they know and trust so be prepared to take the time to build relationships, respect the culture and beliefs and be flexible. Decision making can be slow and whilst you might get frustrated, being aggressive or impatient is a sign of disrespect. Do thorough due diligence on potential partners and suppliers.

Indian businesses are hierarchical and formal so always know who you are talking to, offer and accept business cards and use the person’s full name not first name unless you invited to do so.

Here are some of the key steps you need to work through to export to India successfully:

1. Are your products suitable for the Indian market? India has its own standards and technical regulations for imported products which you must be aware of. Many products are regulated so make sure you understand these requirements and know that you can comply, before you start exporting.
2.  Do you have a market opportunity? Before you start exporting to India make sure you know which state or region you would like to sell to and that there is a market for your product or service. Have a look here for how to do market research. You can also find for export sales leads and connect with overseas buyers who are searching for products like your by looking at the UK’s Export Opportunity Website and signing up to receiving email alerts for opportunities that meet your criteria.
3.  Who is going to represent you? If you are thinking of appointing an agent or distributor, you might find it best to appoint different representatives for different regions. Find out about their:
   • • Local reputation, contacts and business associates
     • Regional coverage
     • Financial resources
     • Marketing ability
4. How will you move products to India?  This will depend on the size and type of products you are selling but consider:
   • • If you are moving goods, use an experienced freight forwarding company with the knowledge of the documentation requirements, customs and import regulations and transport options in India.
     • If you are posting goods to India consult with Jersey Post for the best options available.
     • Make sure you use appropriate packing material as goods can get heavy treatment in India.
5. Visiting in person? At some point you will need to visit the region so if you are travelling to India yourself you will need a visa which is issued by the High Commission of India in London. 
6. Selling online? If you are selling though your website it is advisable to localise your site or use an Indian online marketplace. Use this online tool to help you find the most appropriate marketplace for your product.
7. Establishing a franchise in India? If you have a recognised service then setting up a franchise in India could be an option for you. The British Franchise Association has a lot of information about setting up and exporting your franchise.

Read more about the route to market that might be best for you to help decide on the best option.

Of course, it is very important to make sure that you will get paid for the products or services that you sell in to the Indian market. Here are some practical tips to make sure you get your money:

1. Ideally you will want to get payment or partial payment in advance but if this is not possible use secure terms of payment through a letter of credit or documentary collection via your bank. Talk to your bank about how these mechanisms work, the fees for using them and the paperwork you need to provide.
2. Make sure your contract clearly states the terms for delivery and payment of goods and services. Indian law does not regulate late payments, and settlement action through the courts can be expensive and take a long time.
3. See if you can agree terms in Sterling.
4. If you are trading in Indian Rupees or another currency, get expert financial advice on managing exchange rates, hedging currency and running a foreign currency bank account.
5. India has exchange controls that place restrictions on transferring money out of the country so try not to keep money in India.
6. Remember, although the legal system is based on English Law and the judiciary is relatively independent, the Courts are slow and cases can take many years so litigation is very lengthy and expensive.
7. Consider getting insurance to cover the risk of non-payment.

You can get more information on managing your money in India here.

Digital Innovation:

Although internet penetration in India is only 19%, in 2018 this represented over 500 million users who are driving the growth in the digital and retail sectors. The Indian government’s Digital India Initiative has accelerated much of this growing demand for technology which is creating opportunities in finance, retail, healthcare and education.

As more Indian consumers are adopting digital technologies, opportunities are opening up in sectors such as finance and banking, retail, healthcare and education. In addition, expertise in disciplines such as as building the broadband infrastructure, creating identity solutions, payment systems, web or mobile based delivery solutions and IT for jobs is expected to increase.

Financial, Legal and Professional Services:

The financial services sector is a significant part of India’s economy. The sector, parts of which are being liberalised to allow for foreign investment, includes funds, insurance, audit and consulting and professional services and is growing at around 10% annually.

Retail, Food & Drink

The traditional Indian retail sector is growing at a rate of 13% per annum to reach £624 billion by 2018. Online retail, although smaller in real terms, is growing even faster driven by increased internet availability and the proliferation of smart phones and credit cards. Perhaps most influential is the buying behaviour of consumer who are going online to such an extent that online is expected to equal bricks and mortar retailing by the mid 2020’s.