Renewed optimism as Singapore businesses explore opportunities in India
- Singapore India Business Symposium discusses India-ASEAN trade; highlights opportunities in manufacturing and urban solutions
28 November 2014 [Singapore] - Top business leaders from India and Singapore converged at the inaugural Singapore India Business Symposium today, to discuss new opportunities that come with a government-led push for economic growth in India. Jointly organised by the Confederation of Indian Industry (CII), International Enterprise (IE) Singapore and the Singapore Business Federation (SBF), the Symposium takes place amidst rising optimism among Singapore companies towards doing business in India.
Under the new leadership of Prime Minister Narendra Modi since July 2014, the Indian government has increased FDI limits and implemented reforms to improve the ease of doing business. Several sectors have been identified in the push for economic growth and job creation, with key initiatives such as Make in India, 100 Smart Cities, Digital India and Clean India launched in recent months.
These measures have resulted in business confidence in India increasing to 57.4 in the third quarter of 2014, from 53.7 in the second quarter1. This is expected to translate to interest among foreign investors. Compared to the BRICS and ASEAN nations, India’s ranking in FDI inflows is expected to improve to the second position by 2018, from the fifth place in 20132.
Said Mr Tan Soon Kim, Assistant Chief Executive Officer of IE Singapore, “India’s operating environment has often been cited as a key challenge for businesses. The reforms and initiatives announced recently directly address this issue and signal a positive shift. If seen through, this creates tangible opportunities for businesses in one of the world’s largest markets. This is an opportune time for Singapore companies to review their plans for India, aligned with the Indian government’s priorities.”
Some Singapore companies are already taking steps to expand their presence in India. The Port of Singapore Authority, through a local subsidiary, was recently awarded the concession to develop and operate the fourth container terminal in Mumbai’s Jawaharlal Nehru Port. Singapore Airlines and TATA Sons have entered into a joint venture to establish Vistara Airlines, set to be India’s third full service carrier.
Symposium highlights Modi’s initiatives and business opportunities
At the Singapore India Business Symposium, discussions put the spotlight on ASEAN-India trade, as well as manufacturing and urban development, focus areas identified by Prime Minister Modi as pillars for economic growth.
The “Make in India” initiative aims to boost growth in India’s manufacturing sector, targeting 25 key sectors including textiles and food processing. To support this, the Indian government has undertaken policy initiatives to address the manufacturing sector and set up zones to promote manufacturing activities. This creates potential for Singapore companies, especially those with existing exports to India, to transition into setting up local manufacturing operations.
Keeping with India’s demand for infrastructure, Prime Minister Modi has outlined a vision of developing 100 smart cities by 2020. This will potentially create business opportunities for Singapore companies providing urban solutions such as energy, water, waste management, and transport connectivity.
“Singapore serves as India’s gateway to ASEAN and East Asia. India’s domestic need for infrastructure development offers opportunities for Singapore companies, particularly in the urban solutions space. Prime Minister’s Modi call for development of smart cities across India offers Singapore companies such as Surbana, SembCorp and Hyflux a chance to offer an integrated suite of solutions which can help with the development of these smart cities. The projects also offer downstream opportunities for Singapore SMEs in various sectors like the skills development and building and construction sectors,” said Mr Gautam Banerjee, Vice Chairman of SBF.
Added Mr Ajay Shriram, President of CII, “With Singapore’s leadership in the global financial sector, expertise in infrastructure and urban development, strong presence of Indian diaspora and over 6000 Indian companies in the country, Singapore is a natural partner for India.”
The Symposium was attended by Guest-of-Honour Mr S Iswaran, Minister, Prime Minister’s Office, Second Minister for Home Affairs and Second Minister for Trade and Industry, as well as key Singapore business leaders such as Mr Piyush Gupta, CEO, DBS Group Holdings & DBS Bank; Dr Robert Yap, Chairman & CEO, YCH Group, and Mr Jonathan Yap, Assistant Group CEO, Overseas Funds and CEO India, Ascendas Group. Also present were leaders of top Indian companies and conglomerates such as Godrej & Boyce Manufacturing, Kirloskar Brothers, The Sanmar Group and DCM Shriram.
Singapore is India's largest trade and investment partner in ASEAN, accounting for approximately 28% of ASEAN-India trade3. Under the ASEAN-India FTA (AIFTA) signed in 2011, eliminating or significantly lowered tariffs will come into full effect in 2015, providing greater access to manufacturers in Singapore and across ASEAN. India is also Singapore’s eleventh largest trading partner, with total trade amounting to S$25.5 billion in 2013.