The trade volume between Germany and India is currently around 19 billion euros and is constantly increasing, with India importing German products worth 10,7 billion euros last year. Compared to the previous year, exports to India increased by over 11 percent.
Raghuram rajan
Economists estimate that German exports to India will increase by a further 2018 percent for the current financial year 19/12 - assuming the economic growth forecast remains the same. The growth of German exports to India is therefore dynamic and is developing better than the Indian economy as a whole.
In 2017, India was only able to increase its gross domestic product by 6,7 percent - an increase of over seven percent is estimated for 2018. However, these values remain noticeably behind the ambitions of the Indian government and the country's possibilities, as not only the former head of the Indian central bank and world-renowned economist Raghuram Rajan recently criticized: “The truth is that 7 percent is not enough to provide jobs for those entering the workforce. That’s why we can’t be happy with what we have.”
Our industry as a strategic partner for the Indian economy
As part of the “Make in India” campaign, the Indian government issued the motto after taking office to increase the share of the manufacturing sector in gross domestic product (GDP) from 16 percent to 25 percent in 2022 and thereby create 100 million new jobs.
For Narendra Modi, Central Europe seems to be the model for his future vision of a powerful Indian economy. The Indian head of government is convinced that India today needs a strong export-oriented industry based on the example of Germany, not least to offer its population employment opportunities.
According to Modi, Germany, Austria and Switzerland have a particularly important role to play in modernizing Indian industry. The demand for capital goods, especially machinery and equipment, is extremely high and is largely responsible for the (German) export surplus of well over 2 billion euros. Modi knows that in order to make India a global production location, more machines and closer cooperation with Europe in research and development are needed.
Make in India: Between expectations and reality
Many entrepreneurs seem to have heeded Modi's call. Germany in particular has increased its commitment to the growth market in recent years and is trying to take advantage of the economic opportunities it offers. Germany's direct investments in India have more than doubled to over a billion dollars in the last five years. This fact probably most impressively underlines the positive business climate in our foreign trade and the trust in the Indian market.
India is also being viewed positively internationally these days. The World Bank only published its annual study on October 31, 2018 (Ease of) Doing Business 2019. India moved up 23 places in the economic competitiveness ranking and is now ranked 77th (out of 190).
In this study we want to see whether our foreign trade also sees this euphoria in business practice “India Business Climate Index” answer.
