Indian economy in the focus of German politics. India expert Mike D. Batra and German managers from India speak in the Handelsblatt about their assessment of the growth market.
The fourth intergovernmental consultations between India and Germany took place in Berlin this week. Indian Prime Minister Narendra Modi and German Chancellor Angela Merkel want to intensify mutual trade and investment relations. They agreed that strategies such as the “Make in India” initiative already offer German companies good investment opportunities in India. However, Merkel and Modi underlined their determination to further facilitate trade and investment between the two countries.
Politicians and the media celebrated India this week as a strategic partner of Germany, which could take on the role of the USA in the future, in the interests of German business and politics.
The harsh reality beyond big words on the political stage
While this week India once again moved into the media and political spotlight for a moment and, for once, made positive headlines, the Handelsblatt analyzed the status quo of German industry in India and reported on the “trouble of the plain” in India business.
In the Handelsblatt article German economy in India: disappointment in the booming country on May 28, 2017, India correspondent Mathias Peer lets entrepreneurs who are invested in India have their say. The Bochum pump and fittings manufacturer Klaus Union and the automotive supplier Marquardt report on excessive bureaucracy when setting up a company and problems when purchasing property. Like many other companies, Liebherr is struggling massively with the fact that very few customers in India are willing to pay for the high quality of their products.
Peer also reports how, despite the Modi government's efforts, international corporations such as Telenor and General Motors are withdrawing from India and why Vodafone and Volkswagen have to write off billions in India.
Mike Batra in the Handelsblatt about desire and reality
In the Handelsblatt article, Mike D. Batra, co-founder and managing director of Dr. Wamser + Batra GmbH, the problem of the Indian economy in a nutshell: “Companies often lack realistic expectations. When looking at India’s growth figures, the risks are often completely ignored.”
This makes it clear once again: Even if there is political willingness and even the framework conditions for close cooperation between Germany (or Europe) and India, the challenges of the Indian market do not simply disappear. There is even a risk that companies will go naively and unprepared into a market that they cannot assess and end up burning a lot of money there.
“Modi’s visit will certainly put India back in the spotlight for many companies”says Mike Batra in an interview with Handelsblatt. “It is hoped that they will be there Don’t lose sight of the challenges in the country.”
The WB Business Climate Index offers a realistic assessment of the Indian market:
German economy in India: disappointment in the booming country Handelsblatt article from May 28, 2017, Mathias Peer
Joint declaration on the 4th German-Indian government consultations of May 30, 2017
