The 4 paradoxes of doing business with India

Slow and Fast

We think you need to commit three years to building business in India – but when you first go be ready for anything because demand can be instant. Or not. A careful understanding of the market and assessment of whether it is right for you is essential.

Price and Relationship

We know Indians chase a bargain. But price alone is not enough for longevity in India – you need to build relationships. I would build the relationship first, because anyone can undercut your price.

Status and Money

Status in a hierarchical society such as India is paramount. But now so is money. Making it. Showing it. If your product combines status and money it is a good fit. When there, be careful to fully respect the status of whoever you are dealing with.

“India” and “Many Indias”

India is not one market – it combines many languages and cultures, with people in one part of the country not even being able to understand people in another part. We begin by understanding the regional differences between north, south, east and west – but this is only the beginning of drilling deep to know who you are dealing with and who you are targeting. Beware someone who promises to take you “across India” in one major campaign.

Step one is to get some good market research – the only safe and sound beginning. Add to that some cross-cultural training.

Time, knowledge and patience are the keys.

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Stephen Manallack speaking at Australia India Business Council function

Melbourne is home to many Indians

India is now the biggest source of migrants to Australia, and most come to my city, Melbourne.

Australia is really a “nation of migrants” because all citizens apart from the original indigenous inhabitants came here as migrants.

There are around 170,000 Indian born people here – with many more “Indian-Australians” who were born here. This makes up 3% of our population.

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Diwali is a huge celebration in Melbourne – pictured is Federation Square

50% are families with children and 46% have Australian citizenship.

25% are professionals.

Melbourne is a popular choice for Indian students and tourists.

The Indian community is a big part of making Melbourne a diverse and multicultural city.

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Many business and community functions are held in Melbourne for Diwali – seen here from left are Stephen Manallack. Preeti Daga, Molina Asthana and Anoushka Gungadin. At back are Ian Nathaniel and Michael Moignard

New airport for Navi Mumbai on the way

India’s infrastructure major, L&T (Larsen and Toubro), has bagged the contract for construction of the Navi Mumbai International Airport.

The company did not provide value of the contracts but said the orders fall under “major” category which ranges between US$ 715.40 million and US$ 1 billion.

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Navi Mumbai (shown in these pictures) is a part of Greater Mumbai and is a planned satellite city.

This second international airport for bustling Mumbai is no small venture – it is being developed to initially handle a capacity of 10 million passengers per annum. The project will subsequently be enhanced to handle 20 MPA.

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Regular visitors to India will notice constant upgrades in infrastructure – infrequent visitors will be amazed at the global quality of many Indian airports.

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What is the great legacy of the west?

For over 200 years the west has dominated. Economically strong, trading nations, global defence forces. It is a good time to ask – what is the great legacy of the west?

The Age of Enlightenment, time of reasoning, power of science, all were revived by the west. This is the view that together we can solve problems.

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Free market economics – has shown how to lift people out of poverty and share the wealth – not perfect, but probably the best model.

Psychology of the positive – anything is possible. Contrast this with “fatalism”. Love this “can do”.

Good Government – the west leads in healthcare, infrastructure and education – and in the west people receive lots of government sponsored information and practical ways to live better. Of course, not perfect.

This is a legacy that will impact on those emerging leaders such as India and China.

The changing mindset of India

The mindset of India has split into two camps – one, the traditional, opposes spending and innovation – the other, entrepreneurial, chases innovation and adventure. It can be tough to navigate.

I was talking to an Indian colleague the other day about collaboration around Hydroponics – growing vegetables and some fruits in a liquid solution combined with various forms of protection such as glasshouses.

This is ideal for India – does not need good land, uses less water, produces the same quality 365 days per year and so on. Plus it grows crops that India’s growing urban populations demand – fresh capsicums, lettuce, broccoli, cucumber and strawberries.

But the early India response is an insight into the competing mindsets.

From one quarter of traditional banking, no thanks, it would cost money to install. Forget the benefits. Forget the competitive advantage. If it costs money, NO.

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From another side of the India mindset comes an enthusiastic response – an entrepreneurial and CSR view. This can make money plus help poor rural farmers and poor rural women. So, YES.

As an optimist, I am guessing the YES side will win on this one.

The Australian Government is probably facing this varying mindset as it seeks to heavily promote Australian coal exports to India.

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Yes, our coal can provide India with uninterrupted power, increasing efficiency and quality of life (and add to the already overwhelming pollution).

No, it would cost money and we put up with interrupted supply anyway. And, No, because we do not have the distribution network so alternatives such as solar are attractive for rural villages (even if interrupted, “it’s better than nothing”).

I am guessing that the NO side might win on the coal issue. But let’s wait and see.

Why is the west being so jittery about the rise of Asia?

Trade war on China. Military action here and there.

The west is jittery. Yet all we have is the return to the normal state of affairs – until exactly 200 years ago China and India were major global economies. Now they are again.

So, why is the west so jittery about the rise of Asia?

First, the west “won” the cold war against Russia without firing a single shot. Great victory – but the pride of that has become hubris and shows in a belief that only western liberal democratic countries can succeed. And here comes China. Not western, not liberal and not democratic. Jittery.

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Second, 9/11 was a shocking event that dominated the mind of the west then – and now.

Wile we focused on 9/11, two things happened – rising China joined the World Trade Organisation and the lowest earners in the USA were hit by a 50% decline in income.

Hence – Trump. And hence, lots of jittery decisions being made throughout the west.

Can the west get back to rational, calm and innovative leadership? I hope so.

Thanks to Kishore Mahbubani for inspiring some of the above.