/INTERNATIONAL BUSINESS

INDIA
/ OPPORTUNITIES AND CHALLENGES FOR NORWEGIAN
COMPANIES DOING BUSINESS IN INDIA
/ 2011-2012
/INTERNATIONAL BUSINESS

INDIA
/ OPPORTUNITIES AND CHALLENGES FOR NORWEGIAN
COMPANIES DOING BUSINESS IN INDIA
/ 2011-2012
 “For neither man nor institution can meet that overpowering
environment [India] without a change of identity”

- Robert Byron (1905-1941)

4| IB International Business India

IB International Business India 5|
PROLOGUE

PART 1: INTRODUCTION TO INDIA

PART 2: BUSINESS IN INDIA

PART 3: BUSINESS SECTORS

EPILOGUE
6| IB International Business India
 PROLOGUE

TABLE OF CONTENTS 4
EXECUTIVE SUMMARY 6
INTERNATIONAL BUSINESS – A UNIQUE STUDENT PROJECT 8
ACKNOWLEDGEMENTS 10
THANKS 13
PROLOGUE 14
THE IB TEAM’S TRIP TO INDIA 16

KEY STATISTICS 22
ECONOMY 24
HISTORY 28
POLITICS 30
SOCIETY AND CULTURE 32

BUSINESS CULTURE 38
INFRASTRUCTURE 42
REGULATIONS, BUREAUCRACY AND LAW ENFORCEMENT 45
CORPORATE SOCIAL RESPONSIBILITY 48
CORRUPTION 50
INTERVIEW 1 52
HOW TO ATTRACT AND KEEP TALENT 53
THE INDIAN CONSUMER MARKET 54
INTERVIEW 2 58
NOTES ON ENTERING A FOREIGN COUNTRY 62

OIL AND GAS 66

LNG 68
SHIPPING 70
AQUACULTURE 72
IT 74

EPILOGUE 78
THE IB INDIA TEAM PROFILES 80
PREVIOUS IB PROJECTS 82
NEXT YEAR’S IB PROJECT 83
SPONSORS 84
REFERENCES 85

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// EXECUTIVE SUMMARY

THIS REPORT IS THE OUTCOME OF AN INDEPENDENT, you are well connected and have thorough local expertise
NON-PROFIT STUDENT BUSINESS PROJECT conducted and knowledge when you choose to enter India.
by master students from NHH, BI and NTNU. The aim of the
project is to analyze opportunities and challenges for Norwe- NORWAY HAS A LOT OF KNOW-HOW and resources that are
gian companies considering entering India. Our findings are valuable for a fast developing country like India. Our expertise
based on data gathering, thorough analyses and a field trip to in the energy and maritime sectors is especially important
Delhi and Mumbai in January 2012. The field trip consisted and can benefit Indian as well as Norwegian stakehold-
of visits, interviews and meetings with Norwegian companies ers. Healthy trade and interaction is possible, and the best
and institutions. case scenario is a win-win situation where we all exploit the
competitive and comparative advantages that exist. In pursu-
INDIA OFFERS CONSIDERABLE OPPORTUNITIES both on ing this, the challenges mentioned above have to be given
the supply and demand side. Cheap, skilled labor and a vast appropriate attention.
and emerging consumer market make it attractive for Nor-
wegian companies to explore this gigantic democracy. The
challenges and risks are however many and decisive. India is
a 1.2 billion democracy, and the complexity of the society is
almost beyond our understanding. Widespread corruption, a
contextual worldview, poor infrastructure and a heavy and un-
predictable bureaucracy are the main challenges for Norwe-
gian businesses. Corruption is a result of the general mindset
and philosophy and the tradition of emphasis on respect,
loyalty and tight networks and relationships.

THE INFRASTRUCTURE FAILS TO KEEP UP WITH THE GEN-

ERAL DEVELOPMENT OF THE COUNTRY and severely slows
down the progress. The complex and chaotic bureaucracy
is a result of what some call “too much democracy” and
decision making processes are slow and inefficient. Some
claim it is the price you have to pay for a democracy of this
proportion. The unpredictability in the regulatory bodies also
hinders foreign investments.

ENTERING INDIA REQUIRES CONSIDERABLE FINANCIAL

STRENGTH, local knowledge and masses of patience. A way
to increase your chance of success is to spend time ahead of
entry on establishing relationships and partnerships so that

IB International Business India 9|

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// INTERNATIONAL BUSINESS
– A UNIQUE STUDENT PROJECT

INTERNATIONAL BUSINESS (IB) is an annual non-profit proj- an extraordinary pace. Studying the development of India
ect carried out by a group of twelve students attending NTNU is a continuous process, and the pulse of this society is far
- the Norwegian University of Science and Technology, NHH from resting. Considered the world’s biggest democracy and
- the Norwegian School of Economics and BI - Norwegian counting for about a seventh of the world’s population, India
Business School, in collaboration with Innovation Norway. represents indefinite opportunities and challenges in business
as well as in all other aspects of society. India’s complexity is
THE MAIN PURPOSE OF THE PROJECT is to explore inter- intimidating, but trying to obtain important insight about it is
national market opportunities for Norwegian ventures and nonetheless an extremely exciting challenge. The IB team is
thereby support Norwegian companies considering enter- thrilled to take on this task.
ing these markets. IB was conceived in 1984, initiated by
what is now Innovation Norway. Since then IB has visited all
continents, each year selecting a country of special interest
or relevance. Through extensive research, a field trip and the
making of a comprehensive yet practical report, IB contrib-
utes to improving opportunities for Norwegian products and
ideas to reach beyond our borders. This report is based on
IB’s field research in India during January 2012 and extensive
research conducted from Norway throughout 2011. Research
conducted in India primarily included meetings and interviews
with Norwegian companies already established in India as
well as briefing from Innovation Norway and other institu-
tions.

CONCERNING THE PROCESS OF THE PROJECT AS A

WHOLE, the team was appointed in March 2011 by last
year’s team and has worked on this project through the
year in addition to our respective studies. The IB project is
interesting and exciting in and on itself, but it is also a great
opportunity for dedicated and eager students to explore, learn
and connect. Experiences obtained during a year as an IB
member is valuable for future careers as well as a source of
general learning and growth.

THIS YEAR, THE MIGHTY SUB-CONTINENT OF INDIA IS

THE COUNTRY OF CHOICE. Although IB has explored India
before, this colossus of a country changes and develops at

IB International Business India 11 |

 // ACKNOWLEDGEMENT

SINCE 1984, International Business has encouraged Norwe-

gian companies to look abroad for new market opportunities.
Their experience has revealed that the project’s sources open
up more to students than to professional consultants, and
that students with a youthful curiosity are more likely to ques-
tion established industry assumptions.

WE ARE VERY PLEASED to note that International Business

will be focusing on India in this year’s project. Today, India
is one of the most exciting and complex of all emerging
markets. It has a huge potential: a large domestic market, a
growing middle class, strong GDP growth, and a lot of cheap,
skilled labor. These factors, among others, make it attrac-
tive for foreign companies. Despite the strengths and great
potential in the Indian economy, doing business in India is
also considered very challenging. This project provides useful
insight by shedding a light on some of the most prominent
challenges and obstacles you need to overcome to accom-
plish healthy cooperation and trade.

“WE ARE CONFIDENT THAT THE PROJECT WILL CON-

TRIBUTE WITH VALUABLE INFORMATION about how to
do business in the Indian market to Norwegian exporters,
entrepreneurs and investors.”

INTERNATIONAL BUSINESS Is also a great opportunity

for ambitious top students to get work-related international Gunn Ovesen
experience, in combination with honing skills like leadership, CEO Innovation Norway
cooperation and time management. Innovation Norway is
happy to support International Business during their annual
project visits.

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// ACKNOWLEDGEMENT

INDIA IS AMONG THE TEN LARGEST ECONOMIES IN THE

WORLD TODAY and some predict it to be the 3rd largest by
2050. With a population of 1.2 billion people and an impres-
sive economic growth averaging 8 percent the last decade,
the Indian market offers great business opportunities to
Norwegian companies.

THE TOTAL TRADE IN GOODS between our countries has

more than doubled since 2005, and so have Norwegian
exports to India. Given the enormous potential of the Indian
market, this figure is expected to increase further.
The Indo-Norwegian relations are well established. I am
particularly pleased that Norway is currently negotiating a
free trade agreement with India through EFTA (The European
Free Trade Association). Once this agreement is in place, it
is likely to enhance economic and commercial relations even
further.

AS MANY AS A HUNDRED NORWEGIAN COMPANIES ARE

ALREADY ESTABLISHED IN INDIA. Norwegian companies
have expertise in many areas of interest to India, especially
in sectors such as oil and gas, maritime, hydropower, ICT
and environmental technology. By exploring our complemen-
tary competences further, we can take full advantage of our
partnership. Trond Giske,
Minister of trade and industry
THE INTERNATIONAL BUSINESS PROJECT can be useful
both for the companies already present in the Indian market
and the companies that are considering entering the market.
I am therefore pleased to acknowledge the work done by
students from NHH, BI and NTNU in writing this report.
When students spend time abroad during their studies and
gain knowledge of foreign markets, it is also of great value to
Norwegian companies. Today’s students are key players in
making the most of the Indo-Norwegian business potential in
years ahead.

IB International Business India 13 |

 // ACKNOWLEDGEMENT

IT WAS A PLEASANT SURPRISE to have five bright, young abundant natural resources, present a tremendous market for
students from Norway coming to visit for International Busi- Norwegian products and technologies. India could also serve
ness Project India 2012. On the first day, we accompanied as a manufacturing base for Norway. India is a source of
the group to Aker Solutions, where Shakti Verma gave us educated, articulate and experienced persons who could be
a fine brief on the history of his company in India and also employed to deliver Norwegian products and services.
regarding their products and position in the high technology
areas of oil and gas exploration. The next day was spent at THE REPORT PREPARED BY THE GROUP makes interest-
the two Kongsberg Maritime (KM) offices in India. It was a ing reading for any Norwegian business seeking to enter
pleasure to answer perceptive questions from these sharp the Indian market. It acts as an inspiration and gateway for
and enquiring young minds, regarding our activities. We availing of the opportunities and benefits which accompany
also took time off to make a trip to our new office building business in India.
where the two KM office staffers will be located in the near
future. Next day, the group paid a visit to Aarambh (an NGO IT WAS A CONFLUENCE OF IDEAS AND CULTURES when
supported by KM) and the Norwegian Consular Office. The we interacted with our talented guests. We were able to ex-
final day of the tour was spent at Central Institute of Fisher- change views on a variety of topics and I was struck by their
ies Education (CIFE). In the evening, the students joined our intelligence, maturity, professionalism and knowledge regard-
office staff for a social event where they were witness to our ing a wide range of subjects. Besides, I was impressed with
energetic engineers literally letting their hair down! We truly their broad-mindedness and openness to new experiences
enjoyed the company of our guests and wish them all the which they imbibed and appreciated. The future of human
very best in their future endeavors. relations and business is bright since we have such talented
and visionary young leaders to take the world to heights
India and Norway have much scope for co-operation which never envisaged before.
can result in a win-win situation. The Joint Working Group
(JWG) for co-operation between the two countries in the
maritime field has identified the following prime areas: Sanjiv Wagh
Deputy Managing Director, KPSPL
1. Shipbuilding
2. Coastal shipping
3. LNG (Liquefied Natural Gas) fuel for vessels

Norway and India have much in common in terms of a

common language (English), a free society, vibrant de-
mocracy and liking for traditional values. In many ways the
two countries are different, but I feel that these differences
complement, rather than contradict, each other. India’s huge
population, young demography, burgeoning middle-class and

14 | IB International Business India

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// THANKS!

Harald Nævdal, Arti Bhatia & Rajeev Kour at Innovation Norway, New Delhi

Arti Shetty, Capt. Sanjiv Wagh, Ranesh Kumar Ray, Bjørn Evensen & Lars Granbakken at Kongsberg

Aslak Brun & Kristin Traavik at the Royal Norwegian Embassy, New Delhi

Arne Elias Corneliussen at Norwegian Risk Consulting International

Piyush Mathur, Roosevelt D’souza & Singh Bhuwan at The Nielsen Company

Sharad Mehrotra, Yogesh Malik, Helen Døcker, Pallavi Vyas & Jo Eikeland Roald at Uninor

Rajiv Bawa at Telenor Group

Solveig Holm at Bergen Chamber of Commerce

Gunnar Eskeland at NHH

Ann Kristin H. Calisch at Handelshøyskolen BI

Edgar J. Johannesen’s fund at NHH

Shakti Verma at Aker Solutions

Albertt Chetiar at the Royal Norwegian Consulate General, Mumbai

Wazir S. Lakra at Central Institute of Fisheries Education

Tor Inge Vasshus at Corporater

Derick Dias & Ruby Vazirani at DNB Representative Office Mumbai

Visumservice

IB International Business India 15 |

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 PROLOGUE

// PROLOGUE

JUST DAYS BEFORE THE COMPLETION OF THIS REPORT corporate social responsibility, the consumer market, how to
it was known that Telenor’s billion dollar investment in India attract and keep talent in your company, entrepreneurship,
is at risk as all their licenses to operate is withdrawn by the risk categories and bureaucracy. It also includes two depth
Indian Supreme Court. The licenses are withdrawn because interviews with persons who know their fields and have a lot
of ambiguity concerning the initial allocation process from the of experience from operating in India. These interviews give
government to the telecom companies back in 2008. Telenor further insight and knowledge about the daily challenges and
was not involved in India at the time, but their current partner opportunities you will face.
Unitech Wireless was one of the companies buying licenses.
The withdrawal decision came as a surprise to Telenor and PART 2 IS OUR FOCUS AREA IN THIS PROJECT. Norwegian
they now risk losing billions of dollars. With about 36 million companies in India face and deal with these topics every
Indian customers it is still uncertain whether Uninor, Telenor day, regardless of industry. We find these topics particularly
and Unitech’s joint venture, will buy back the licenses or exit interesting because everyone who is considering or is already
India. What seemed like a prosperous investment in a huge established in India have to make up their mind about these
market and an even bigger potential market have turned out issues and everyone we met on our trip had opinions and
to be a nightmare for the Norwegian telecom giant. comments on these matters. However, we also have a small
section – part 3 – where we go a bit more into detail on
THE TELENOR CASE highlights why the report you are read- specific industry environments. Here we provide a brief intro-
ing actually exists. This particular situation perfectly illus- duction to industries that stand out as particularly relevant for
trates the challenges, risks and opportunities one faces when Norway and where we obtained interesting insight during the
entering such a complex market. Since 1984 International project.
Business has travelled the world and revealed challenges and
opportunities concerning taking your business abroad. This THIS IS A STUDENT PROJECt with all its advantages and
year IB has explored incredible India. Vast opportunities in limitations. We provide a student point of view and a young,
supply as well as demand make this colossus highly interest- curious approach to a topic that has been covered by many
ing for many Norwegian companies. Whether you want to sell before us. We do not try to offer more information or better
consumer products or exploit the cheap and skilled work- quantitative data than others. We rather want to shed a differ-
force, India is the place to be. Not without obstacles, though. ent light on things by actually travelling to India, meet numer-
Poor infrastructure, a heavy and unpredictable bureaucracy ous knowledgeable people who work with these problems
and a totally different mindset can easily destroy your dream every day, get hands-on experiences and capture our most
of an Indian adventure for your business. The mission of important insights in this report. That makes it qualitative and
this project is to highlight and analyze these challenges and subjective – for better or worse. We have intentionally incor-
opportunities in order to help Norwegian businesses which porated several personal experiences and examples from our
consider entering this beautiful and complex sub-continent. field trip throughout the report. The motivation behind sharing
Less than a month ago we visited the Uninor headquarters these observations is to support our analysis and highlight
just outside New Delhi, the very same place that is now our points.
most likely in a state of shock and crisis. Some of the top
executives took their time to meet us and tell us about their DUE TO VARIOUS CIRCUMSTANCES, only five of the original
strategy, the current development and the prospects for the twelve project members were able to go to India this year.
future of Telenor in India. As Norwegian business students we With this limited capacity the report is not as comprehensive
feel privileged to experience such an important international as previous years. We have tried to focus more on qualitative
affair including power struggles, dirty money, big business studies and personal analysis than extensive secondary data
and political strategies in such a hands-on manner that we gathering. At the end of the day that is the kind of insight you
did. We read the newspaper articles about the Telenor case cannot get from books or the internet.
in a different light now. International Business gave us this
opportunity and we are grateful for the interesting adventure Bergen, February 2012,
we got to be a part of. International Business India

THE REPORT IS DIVIDED INTO THREE PARTS. Part 1 is a

brief introductory part including short summaries of the key
statistics, culture, society, history, politics and economy of
India. Following is part 2 on general implications of doing
business in India. This part is our main focus and where
most of the analysis is conducted. Light is shed on the
aspects of corruption, infrastructure, business culture,

IB International Business India 17 |

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// THE IB TEAMS TRIP TO INDIA

JANUARY 4TH 2012 five members of the IB team headed also had a short meeting at the Royal Norwegian Consulate
southeast to incredible India. For three weeks we discovered General where they elaborated on their services to Norwegian
the mighty subcontinent and obtained hands-on experiences shipping companies and also about current issues in the
in business as well as in the Indian society in general. It was export of Norwegian salmon to India. The eventful week was
a journey of a lifetime and a learning experience out of the or- finished off with a morning at the Central Institute of Fisheries
dinary. Every day was filled with important observations and Education and joining the celebration of KPS’s six year an-
insights we could use when making this report. Our curiosity niversary in Mumbai at a hill station a couple of hours outside
and hunger for knowledge certainly had the opportunity to the city.
unfold and indulge as we were introduced to many different
environments and settings. STILL IN MUMBAI WE ALSO MET UP WITH THE NIELSEN
COMPANY. They provided us with facts, figures and trends
WHEN BOARDING THE PLANE IN OSLO OUR DESTINATION on the Indian consumer market. The day after, we paid a visit
WAS THE CAPITAL DELHI. Our first meeting was at Innova- to the Mumbai Representative Office of DNB which mainly
tion Norway where they gave us an interesting and useful supports and cater for Norwegian businesses in India. To fin-
introduction to business culture as well as practical informa- ish where we started, we returned to Delhi for four more days
tion for the trip. The day after, we were lucky to get a meeting before leaving for Norway. We spent most of the time work-
at the Royal Norwegian Embassy. They introduced us to ing on the report, but also paid a visit to Uninor in Gurgaon.
the more political and economic aspects of doing business People in important positions took their time to talk to us, and
in India. We were grateful for having the opportunity to ask it was interesting to get under the skin of such a big company
questions and to get an embassy’s point of view.
WE ARE FOREVER GRATEFUL FOR THE HELP and endless
AFTER FOUR DAYS WE HEADED SOUTH TO VIBRANT hospitality of everyone we met when in India. We also deeply
MUMBAI. For ten days we got to know this chaotic yet appreciate all the help and support we received from various
surprisingly well-functioning metropolis. The first week bodies in Norway prior to departure. As students doing an in-
Kongsberg Process Simulation Pvt. Ltd. had made all the dependent project, we could not ask for better assistance and
arrangements for us. They had put together a program that care when approaching companies and institutions. The three
really gave us a lot of important and interesting insights as weeks spent in India will be forever memorable. We have
well as enjoyable events and new acquaintances. We met up learned so much about India from a Norwegian perspective
with the managers of Aker Solutions MH, Kongsberg Process and have done our best to capture the insights in this report.
Simulation and Kongsberg MI and got to talk about opportu-
nities and challenges being a Norwegian company in India.
We also got to see the new building where KPS and KMI will
come together later this year.

AN OUTCOME OF KONGSBERG’S CSR STRATEGY is dona-

tions to an NGO in the slums of Navi Mumbai. This NGO
provides education and food for children and adolescents
and we paid a pleasant visit there accompanied by the HR
manager of Kongsberg who is in charge of the follow-up. We

IB International Business India 19 |

 (Photo: Tony Hall)

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20 | IB International Business India

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IB International Business India 21 |

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// PART 1: INTRODUCTION TO INDIA
IB International Business India 23 |
24 | IB International Business India
 INTRODUCTION TO INDIA

// KEY STATISTICS

OFFICIAL NAME Republic of India

INDEPENDENCE 15 August 1947 (from the UK)
POPULATION 1,2 billion (per cencus 2011)
CAPITAL New Delhi
LANGUAGES Hindi, English and at least 16 other official languages
AREA 3 287 263 square kilometers
COASTLINE 7 516 kilometers
MOST POPULATED CITIES Mumbai (Bombay), Delhi, Bengaluru (Bangalore), Hyderabad

GDP (PPP) $ 4.469 trillion (2011)
UNEMPLOYMENT RATE 9,40%
EXPORTS $ 225.6 billion (2010 est.)
IMPORTS $ 357.7 billion (2010 est.)
HUMAN DEVELOPMENT INDEX (HDI) 0,547 (2011), ranked 134

LIFE EXPECTANCY 66,8 years
POPULATION GROWTH 1,344% (2011)
POPULATION UNDER THE AGE OF 14 29,7% (2011)
BIRTH RATE 2,097 % (2011)
FERTILITY RATE 2, 62 children born/woman (2011)
LITERACY 61%
RELIGION Hindu 80,5%, Muslim 13,4%, Christian 2,3%, Sikh 1,9%, other 1,8%

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 INTRODUCTION TO INDIA

// ECONOMY

PAST decrease in the industrial production, high local borrowing

In the financial year 2007-2008, India recorded a GDP growth costs and a deepening euro-zone crisis were main factors
of 9.1%. This enabled India to become the second quickest for the decline. On the other hand, the service side of the
emerging economy in the world, only beaten by China. The economy has remained strong, led by trade, hotel, transport,
Indian economy that we know was built after the indepen- and communication sectors. The crisis in the euro-zone has
dency from the colonial rule in 1947. Five-year plans were decreased high-risk investments. Emerging markets, such as
used to stimulate the economic growth in a best possible India, are therefore affected by this, contributing to an 18%
manner. These plans focused on the needs of the economy slide in the rupee since July, and lifting the costs of imports,
and adapted thereafter. The economic system was based on especially oil.
social demographic-based policies featuring protectionism
and extensive regulations. In the 1990s, the economy started Due to the enabling of international competition in the Indian
to increase more rapidly than ever before (economywatch. market, foreign investments have increased enormously. The
com, 2010). Trade liberalization, financial liberalization, tax flip side of this growth is a huge budget deficit together with
reforms and opening up to foreign investments were some of a great deal of defense expenditures because of the ongoing
the important steps which helped the Indian economy to gain conflict with Pakistan. Other negative aspects are the non-
momentum. The economic liberalization and the more acces- existing social services, miserable roads, inadequate ports,
sible market that Man Mohan Sing enabled during his period and an old telecommunication infrastructure (Hudson, 2011).
as a finance minister in 1991 has been a stepping stone in
the Indian economic growth (mapsofindia.com, 2011). Looking at the economy in a domestic manner, the growth
is of great divide. The state of Maharashtra, with Mumbai as
an highly important city, contributes for over 40 per cent of
PRESENT India’s national revenue (rediff.com, 2011).
Today, the Indian economy is ranked as the fifth largest in
the world, by purchasing power parity (PPP), right after US,
China, Japan and Germany (articles.economictimes.india- FUTURE
times.com, 2011). By nominal GDP, the economy is the 11th According to a survey by Morgan Stanley Group, India will
largest. It is also the second fastest growing economy. The overtake China as the world’s fastest growing economies in
GDP (in US$) was 1.846 billion in 2011. 2015. Generally, there are two reasons for this: An increase
in the working age group and an increase in the FDI in recent
India’s economy is divided into three sectors: Service years (squamble.com, 2010).
(52.9%), industry (29.4%), and agriculture (17.7%) (Hudson, India has experienced an evolving growth-inflation condition.
2011). Service is the fastest growing sector, with a growth According to Forbes (2010), inflation will dictate the next
rate of 11% from 2006-2007 (yellow in graph). At the same steps of the government and the Reserve Bank of India (RBI).
time, industry experienced a growth of 10.9% (blue) and If oil prices go up, inflation could go up to 5% to 6%. Until
agriculture with 2.7% (green). about July, it is likely to be around 4% to 6% (Forbes.com,
2010).
Due to turbulence in the global economy, the economic
growth slightly slowed down in 2011. The economy grew at
its lowest for two years with a GDP growth rate of 6.9%. A

IB International Business India 27 |

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 INTRODUCTION TO INDIA

IB International Business India 29 |

30 | IB International Business India
 INTRODUCTION TO INDIA

// HISTORY

INDIA’S EARLIEST KNOWN CIVILIZATION, CALLED THE INDIA WAS A WEALTHY COUNTRY economically and cultur-
INDUS VALLEY CIVILIZATION, DATES BACK TO 2500-1700 ally up until British colonization. Europeans would trade with
BC. The civilization has been traced back to sites such as India for spices or cotton textiles, but when the British colo-
Harappa and Lothal. The origin of the caste system and the nized the country the economy declined. This was due in
basis of Hinduism are both based on the Vedic culture dating part to exploitation and destruction of India’s industries and
back to the 1500 BC. Large parts of India were united when wealth. Eventually, India would be granted its independence
the emperor Ashoka, also known as Ashoka the Great, ruled again in 1947, after which a slow progression has been
what was called the Mauryan Empire during the period of seen in its development. India then adopted a parliamentary
304-232 BC. India then included what today is known as system of government with a union of states proclaiming to
the area stretching from Afghanistan to Bangladesh. Ashoka make up a Sovereign Democratic Republic.
converted to Buddhism, which can be found in areas where
he once ruled.

ISLAM, INITIALLY ESTABLISHED AS A POLITICAL POWER,

CAME TO INDIA DURING THE 8TH CENTURy and by the
11th century the religion had firmly established itself as a po-
litical force including the North Indian dynasties of the Lodhis,
the Tughlaq and others. When the Mughal Empire rose during
the 15th century under Akbar the Great, the country enjoyed
cultural and economic progress, as well as religious har-
mony. Many of the famous buildings in India, such as the Taj
Mahal and the Red Fort were erected during the Mughal age.
In 1725 the dynasty was weakened by wars of succession
and growth of religious intolerance, which lead the empire to
disintegrate. It was also during the Mughal Empire that Urdu
was evolved from Persian, then the official language of the
empire. The last Mughal emperor was deposed by the British
and exiled to Burma following the Indian Rebellion of 1857.

THE BRITISH EMPIRE came to be and India was referred to

as the British Raj (reign), where Queen Victory was also the
Empress. The rule would last from 1858 to 1947 and several
signs of it can still be found in today’s England and India.
These amongst include English being the official language of
India, cricket being a popular game in both countries as well
as the curry having a large culinary impact in the daily diet of
many British.

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 INTRODUCTION TO INDIA

// POLITICS

AFTER ITS INDEPENDENCE FROM THE RULE OF BRITISH FOR MOST OF THE YEARS SINCE INDEPENDENCE, the
QUEEN ELIZABETH IN 1947, India became a federal consti- federal government has been guided by the Indian National
tutional republic with its President as the head of state and Congress (INC). The two largest political parties have been
prime minister as the head of government. The President has the INC and the Bharatiya Janata Party (BJP). Although the
executive power and is independent of the legislature. The two parties have dominated Indian politics, regional parties
ones who do have legislative power are the government and also exist. Economic issues like poverty, unemployment and
the two chambers of parliament, namely the Lok Sabha (the development are main issues that influence politics. Garibi
lower house) and the Rajya Sabha (the upper house). Today, hatao (eradicate poverty) has been a slogan of the Indian
India is a federation of 28 states and 7 union territories and National Congress for long. The well known Bharatiya Janata
the total federation is referred to as the Union. Party is looked upon with grace as a political party that is
indeed encouraging to free market economy, businesses and
THE PRESIDENT OF INDIA resides in an estate in New Delhi others. The Communist Party of India (Marxist) vehemently
known as the Rashtrapati Bhavan (which roughly translates supports left-wing politics like land-for-all, right to work and
as President’s Abode). The presidential retreat is The Retreat has strongly opposed to neo-liberal policies such as global-
in Chharabra, Shimla and Rashtrapati Nilayam (President’s ization, capitalism and privatization. The economic policies
Place) in Hyderabad. The first prime minister of independent of most other parties do not go much further than providing
India was Jawaharlal Nehru, who held office from 1947 until populist subsidies and reservations.
his death in 1964. Apart from a short period of two years
from 1975-77, when an internal emergency was imposed by THERE ARE SEVERAL ISSUES IMPORTANT IN INDIAN
then-Prime Minister Indira Gandhi and constitutional liberties POLITICS, both on a national and regional level. Such issues
were suspended, India has been a thriving parliamentary de- include economic and social rights for communities, an in-
mocracy. The 15th President of India is Her Excellency Prat- creased demand of autonomy of the different cultures within
ibha Devisingh Patil who was sworn in on July 25th 2007. the Indian states and some states demanding independence
from India. The lack of homogeneity in the Indian popula-
INDIA IS CONSIDERED TO BE THE LARGEST DEMOCRACY tion causes division between different sections of the people
IN THE WORLD as well as having the largest number of po- based on religion, region, language, caste and race. This has
litical parties that participate in the elections. In the national led to the rise of political parties with agendas catering to one
elections, candidates are chosen for the Lower House. The or a mix of these groups. Indian democracy has been sus-
candidates are elected in territorial constituencies. There pended once. Nevertheless, Indian politics is often described
are 543 territorial constituencies. Two members from the as chaotic. More than a fifth of parliament members face
Anglo-Indian community are nominated to the Lower House criminal charges.
by the President. The law, which obliges Government office
to reserve 15% from the Scheduled Castes and 7% from
the Scheduled Tribes, also exists in the Parliament. At least
22% of the Indian Parliament members belong to these two
communities. In the past few years there has been an attempt
to oblige a law to allow about 33% women as Parliament
members.

IB International Business India 33 |

 // SOCIETY AND CULTURE

SOCIETY
The Indian society is of great complexity, and the huge variet-
ies within the country are just as significant as those we find GENDER DISTINCTIONS
among the countries of Europe. India is a hierarchical society. The behavior expected of men and women can still be
Within different casts, gender, age, areas, and religions the different, especially in villages, but also in urban centers.
rank does still matter. So even though India is a political Prescribed ideal gender roles help shape the actions of both
democracy, the differences among the social status is still of sexes as they move between family and the world outside the
great importance for the people of India. home. The role of the women varies a lot within the different
religions and also the different regions. For instance, they are
much more independent among the Hindus than the Muslims.
ETHNIC AND LINGUISTIC DIVERSITY The women have also been represented in visible positions
The different regional, social, and economic groups all in the public sector for a long time, and the private sector has
have distinct cultural practices. There are great distinctions also increased the level of females in important positions. It
between the different regions in India. The practices in the is now also very common for women to take higher educa-
south would vary a lot compared to the north. The same tion.
varieties are also to be found between the west and east. For
instance, the language spoken in the south is unintelligible for
the northern people. The main religion of India is Hinduism, THE CASTE SYSTEM
practiced by 80% of all Indians. Islam is one of the larg- The Indian caste system is divided into different groups
est minorities practiced by about 13%. Buddhism, Janism, which indicated the social structure, where people are ranked
Christianity and Sikhism are also practiced religions, as well according to their casts. They are born into a certain cast,
as atheism and agnostics also have had a greater influence and while it is originally associated with the Hindus, the
among the people. casts are also found within other religions such as Muslims
and Christians. The Indian constitution has officially out-
lawed caste-based discrimination. However, the castes have
WEALTH AND POWER existed for centuries and caste ranking and discrimination
Wealth and power varies considerably, and vast differences still occurs, especially in the rural areas. In the larger cities
in socioeconomic status are evident everywhere. The poor the caste barriers are more broken down, and the tendency
and the wealthy live side by side in urban and rural areas. is that the more modern and educated you are, the less you
While about 40% of all Indian children suffers from malnutri- care about the caste system.
tion, overweight among the upper class are also considered
a great problem, which affirms the great contrasts of India.
Distinctions of class are found in almost every settlement in CULTURE
India. Throughout India, individuals are also ranked according Trying to describe the Indian culture as one culture is like
to their wealth and power. trying to describe European culture as one culture; inappro-
priate because of its diversity. The contrasts are vast both
regarding geography, religion and social aspects, and there is
no wonder India is often referred to as a continent rather than
a country. Still, India is in fact one nation with one flag, and
URBAN-RURAL DIFFERENCES there are certain features that can be used to characterize
About 70% of India’s population lives in villages, with agri- some fundamental attitudes and values.
culture providing support for most of these rural residents.
The rural areas are still very poor and most of the develop-
ment has not yet reached these parts. The biggest difference TIME, KARMA AND THE CIRCLE OF LIFE
among the rural and urban areas, are the standard of living. First of all, and maybe one of the most visible and easily
The conditions of living are considered better in the urban ar- notable features in the Indian society, is the Indians’ attitude
eas. Even though slums and low standards are also found in to time. As we like to see time as a linear concept, Indians
the cities, the conditions in the rural parts are still of signifi- in general tend to perceive time as a circular phenomenon.
cant difference. The lack of electricity and the fact that ground Time does not run out – it is eternal and always comes back.
water is the main source of water in these areas verifies that In the modern Western societies like the Norwegian we feel
the rural areas are less developed. Another great difference that time is precious and that we have to rush to make the
is that the people of the rural areas get less education. The most of the little time we got, but the Indians are not in such
trend is still that parents tend to prefer that their children work a hurry. This worldview might be connected to the concept
in the field instead of going to school. of reincarnation and karma – the underlying mechanisms

34 | IB International Business India

 INTRODUCTION TO INDIA

of cause and effect. Karma has a religious origin and says Norwegian honesty and frankness. We are used to people
that what has happened before and perhaps in a previous openly admitting limitations, but the Indians do not share
life can affect what happens to you in this life. It is not only this kind of openness. An example of this is when we asked
our own actions and decisions that affect what happens, a waiter what a specific element of a dish was and she an-
but something beyond our power. Life and time runs in a swered zucchini when it turned out to be cheese and claimed
continuous flow where there is no beginning and no end. An that the salmon originated from Kolkata when it after further
individual life is just one out of many lives that are all con- investigation turned out to be Norwegian. They really make
nected through destiny, reincarnation and karma. This creates an effort to meet others’ needs and questions and sacrifice
a more relaxed attitude to the aspect of time. honesty for the sake of it. Indians find it difficult to show
We definitely got to experience this attitude when travelling in direct disagreement, and they often tell you what they think
India. Time efficiency is an apparently unknown term, espe- you want to hear. As a result of this, you most likely get a yes
cially considering the fact that Norwegians in particular are if you ask a yes-or-no question regardless of what the real
obsessed with spending our time wisely. Conversations and answer is. A way to avoid misunderstandings because of this
personal relationships seem more important than keeping up feature is to ask open questions where you cannot answer
with the schedule. Your lunch break will not end at a certain yes or no, or ask several people about the same.
time, but when the discussion is over. Hence, if you consider
doing business in India you ought not to be in a hurry.

TIGHT RELATIONSHIPS
Furthermore, Indians are generally more traditional when it
comes to family relations and personal networks. Family ties
and friendships are usually tight and highly respected. Nu-
merous businesses are family businesses and Indians think
of family in a wider sense than we do. Where we tend to feel
strong connections to our siblings and parents, but perhaps
not as much to more peripheral relatives, the Indians treat
even a distant cousin like a brother. They also show more
respect and care for the elderly. One of the Indian managers
of a Norwegian company told us that the elderly in the family
often live with one of the children. Retirement homes are
not widespread and might be considered disrespectful. The
couple we visited both had their parents staying with one of
their children.

PATIENCE AND POLITENESS

The Indians are apparently peaceful, respectful, patient and
polite. They treat others with the utmost respect and warmth
(except in traffic where there is every man for himself). As
a nation of 1.2 billion people including the richest of the rich
and the poorest of the poor, patience and respect is a inevita-
bility. Coming from a more homogenous society, Norwegians
might find this apparent social peace among such a frag-
mented society surprising in a positive way.

However, the humility and politeness might cause frustration

for a foreigner. Afraid to lose face or to admit incompetence,
an Indian might accept a task even though he knows he is
incapable of completing it or give directions even though
he has no clue where the train station is. In everyday life as
well as in business this might cause misunderstandings and
frustration. Again, this feature is in distinct contrast to the

IB International Business India 35 |

 HOW VISUMSERVICE HELPED IB
As a foretaste on the Indian bureaucracy, we faced some challenges when applying for our visas before departure to India.
Firstly, it was difficult to get a straight answer on what kind of visa we needed. The embassy was not able to give us a quick an-
swer on whether we needed tourist, business or entry visas, and this delayed our handing in of the applications. Furthermore,
there were obstacles in other formalities and details concerning the applications.
During this process we got in touch with Visumservice. This is an agency that offers visa handling services to persons and
companies as this can be an inconvenient and time-consuming process for many. Like already mentioned, we had experienced
that getting the visas was not as straightforward as anticipated, and decided to engage Visumservice to help us.
Visumservice was a great help for us in the visa application process. They took care of all correspondence with the visa service
department of the Indian embassy. This included working out and handing in the applications, reminding and asking about the
progress and picking up our passports and visas. If it wasn’t for Visumservice we would have had to spend hours working out
the applications properly and following up the process, and due to exams and busy schedules we did not have this time. We
are very grateful for all the help and support we received from Visumservice and strongly recommend them to everyone who is
in need for a visa.

Visumservice AS er Norges største selskap innenfor visum og legaliseringstjenester. Selskapet ble etablert i 2008 og er i dag 9
ansatte og en årlig omsetning på 20 millioner kroner.
Visumservices kunder er selskaper innenfor offshore, shipping, handel, hjelpeorganisasjoner, reisebyråer, medier, offentlige
instanser og privatpersoner.
Visumservice har hovedkontor i Oslo, eget kontor i Danmark og er representert i Sverige, Tyskland, Nederland, Belgia og Stor-
britannia. Vi løser alle behov for visum, arbeidstillatelser og arbeidstillatelser, uansett hvor ambassaden er lokalisert. I februar
2012 lanseres også Visumservice Online, en nettportal med bestilling, mulighet for sporing av søknader, visuminformasjon til
alle land og nyheter. Portalen inkluderer også muligheten for å lagre profiler for personer som reiser ofte.

Gå inn på www.visum.com eller kontakt Harald Olavson på 46474836 / [email protected] for mer informasjon

36 | IB International Business India

 INTRODUCTION TO INDIA

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IB International Business India 37 |

38 | IB International Business India
// PART 2: DOING BUSINESS IN INDIA
IB International Business India 39 |
40 | IB International Business India
 BUSINESS IN INDIA

// BUSINESS CULTURE

To succeed in business in India and in cooperation with contact the boss and await further instructions whereas a
Indian co-workers it is essential to have a common under- Norwegian might try to solve the situation on his or her own.
standing of the cultural differences that exists. Even though Both actions are motivated by the wish to please the boss,
the young and educated Indian workforce tend to have a but the cultural differences might cause different measures.
more “westernized” mindset than their parents and grand- As the Indian believe the right thing to do is to carry out the
parents. Cultural differences are still distinct and might prove boss’ exact orders, a Norwegian might think that making
a considerable barrier to a healthy and productive work independent decisions in order to ease the boss’ concerns
environment. Training, openness and awareness are impor- is the appropriate measure. Note that this mostly applies to
tant ingredients in this process. Institutions like Innovation subordinate employees at the lower levels of the organiza-
Norway provide cultural training for Norwegian companies tional hierarchy. Middle managers and managers are naturally
entering India. more independent.

HIERARCHY AND AUTHORITY EMPLOYEE LOYALTY AND FLEXIBILITY

First of all, it is important to note that India is a highly hier- Asking managers what is the biggest advantage working
archical society. Some even claim it is the most hierarchical with Indian employees compared to Norwegians the answer
country in the world. This naturally also applies to business is clear; their loyalty, respect and flexibility. They prioritize
life and affects business in numerous ways. As Norwegians work before leisure whenever needed and do not fear long
value equality and informality in the workspace as well hours or working on weekends like “spoiled” Norwegians.
as in society, India still remains a nation of distinct social If something comes up Friday afternoon it will be taken care
and formal hierarchies. In sharp contrast to flat Norwegian of straight away, whereas in Norway the employees will
organizations and egalitarian systems, Indians acknowledge leave it, go to “hytta” for the weekend and return to business
authority and do not seem to oppose this concept. This can Monday morning. This dedication to work is common and
clearly be related to the long tradition of the caste system. a great advantage for a manager. The rationale behind this
The hierarchical culture is so strong it even overrules gender behavior might be that Indian workers depend much more
differences and the suppression of women. Anyone would on stable employment as the government provides little or
respectfully submit to a woman as long as she has a superior no social security. The company you work for in many cases
position in the organization. takes over the role as a provider of welfare. The absence of a
A way this authoritarian and hierarchical culture is highlighted welfare state keeps employees on their toes. Once hired by a
is the way an employee receives instruction from its manager solid company, an employee will make a considerable effort
and is to execute these given tasks. Specific instructions to please the boss in order to keep the job as not to lose this
have to be given as employees find it difficult to diverge form of social security. More on employee welfare provision
from initial orders and think critically and “outside the box”. will be found under the section about how to attract and keep
Managers will not meet independence and personal initiative talent.
in a subordinate, but rather respectful submissive behavior.
The upside of this attitude is the notion of loyalty. Principal-
agent problems hardly ever occur as employees are loyal and
humble and respect their superiors and customers. When
an unforeseen situation occurs, an Indian would most likely

IB International Business India 41 |

42 | IB International Business India
 BUSINESS IN INDIA

RELATIONSHIPS AND NETWORKS notice this feature in the lack of proper law enforcement and
As mentioned in the previous section about Indian culture in a general laissez faire attitude.
general, networks, friendships and relationships are highly
appreciated in India. Indians doing business value solid, Like the notion of tight networks, the contextual worldview
long-term relationships and are willing to spend a lot of time also enhances behavior associated with corruption. Weak law
pursuing and maintaining these. In meetings you will often enforcement from the authorities combined with individuals
start off by having a fairly long small talk conversation in not paying too much attention to rules creates a fertile envi-
order to get to know each other and establish a relationship. ronment for illicit activities. In this way, we see that features
Adding the different attitudes to time, one can easily find of the fundamental Indian business culture might be part of
that a Norwegian would feel impatient in settings like these. the reason why corruption is so widespread. When asking
As we like to get to the point quickly and stick to the time people in Norwegian companies about this, some explained
schedule, meetings with Indians often last must longer than that a way to get around this that actually works is to be
scheduled and might be interrupted numerous times. Do not crystal clear on this matter from the very beginning. If zero
get surprised if the members attending a meeting answer his tolerance towards corruption is established when starting a
phone or an email during a meeting. To please the Indians, do partnership or a negotiation, our sources find it successful.
not rush things in business. Take your time and let them get We can of course not say whether this is always the case,
to know you. but it is at least a measure worth carrying out in order to try
to avoid corruption.
The drawback of this focus on tight relationships and
networks is the fact that it might enhance corruption. In busi- JUGAAD
ness environments where there are tight and loyal networks Whereas the Japanese have exported the concept of lean,
and connections one might find it convenient to ask for a fa- the Indians have jugaad as their own business philosophy.
vor and offer one in return and at the same time be confident Jugaad is Hindi and translates to an innovative quick fix or an
that no one will tell on you. improvised, clever solution. It is all about quick reactions and
solutions to make something easy and cheap. The Indians
have jugaad in their blood, but American companies like
CONTEXTUAL WORLDVIEW Apple and Google actually try to adapt some of this mentality
Another quite apparent feature of the Indian business culture by hosting jugaad workshops.
that originates from the general mindset of Indians is the
contextual worldview. Perhaps the most evident example of Jugaad is originally a low-cost simple motor vehicle used
this characteristic is traffic. There are rules, but why stop on for local transportation, but has been adapted as a philoso-
a red light if the coast is clear? The degree of apparent traffic phy used to describe all aspects of life. The essence is that
anarchy varies across cities and areas, but some places innovative solutions can occur even with limited resources.
there seem to be no rules whatsoever. In business, this It is however associated with bending rules, and in this way
phenomenon is visible through the attitudes towards rules, relates to the concept of contextual worldview. You do what-
procedures and routines. The given context is taken into ac- ever you need to do in a given situation and with the available
count rather than general rules or procedures when making resources. The results are more important than following
decisions. This might cause challenges when interacting rules and procedures.
with more rule obeying nationalities. On the macro level you

IB International Business India 43 |

44 | IB International Business India
 BUSINESS IN INDIA

// INFRASTRUCTURE

HAVING A GOOD INFRASTRUCTURE IS ESSENTIAL FOR this has helped the development or not. The infrastructure
A COUNTRY TO BE OPERATIVE. When it comes to infra- that India displayed to the rest of the world was not impres-
structure that includes facilities such as well-developed and sive when thinking about the fact that they had prepared for
efficient roads, railways, airports, harbors, water supply, these games for a long period of time. Anyway, a judgment of
irrigation, power distribution and social structure. These the IIFCL is hard to give without deeper analysis.
facilities are continuously developing and it is important for a
country’s government to always stay on top in these matters. LOOKING INTO THE BUSINESS, you find a lot of interest
from people wanting to carry out the development, but as
THE INDIAN INFRASTRUCTURE DOES NOT KEEP UP WITH mentioned above they meet a lot of obstacles. Projects
THE HIGH PACE OF THEIR GROWING ECONOMY. This is in already approved by the government experience big prob-
many ways inhibiting the Indian society and economy to de- lems when facing implementation and this is often due to the
velop in an even higher speed as it is making investors think complex composition of the bureaucratic system in Indian
twice before entering the country. We would address the lack government. Specifically when it comes to road develop-
of sufficient infrastructure as an obstacle in realizing the full ment, contractors face a lot of problems with the matter of
growth potential in India. During our stay in India we were in land acquisition. In India there is a lack of a uniform land ac-
touch with people who mentioned that the lack of good roads quisition policy. When dealing with these matters, first-hand
makes it difficult to deliver fresh food quick enough. Another accounts have told us that it is almost as if one man raising
challenge is that a company must be prepared to build a new his hand makes it possible to put a stop to big highway con-
road leading on to their new building. The fact that the lights structions. So when facing the start of a big project you have
go out every Thursday in Pune, a city of 4,5 million people is to make sure that you own at least 80% of the land for the
a characteristic example of the weaknesses in Indian infra- planned road. If you do not possess this much of the land,
structure. The government is just not able to facilitate all the you probably end up not being able to finalize your project or
development in the country. paying an overpriced rate for the remaining land.

ONE OF THE MAIN REASONS FOR THE SLOW DEVELOP- DEVELOPING INFRASTRUCTURE demands heavy govern-
MENT OF INDIAN INFRASTRUCTURE LIES WITHIN POLI- mental financing. This is an aspect of the business where the
TICS. Often you have too many competing interests in this Indian government is facing a hard time. Yearly the govern-
segment and this is slowing down the system. We are great ment receives taxes from only 5% of all business done in
believers of that the laws of supply and demand can help India, meaning that only around 24 million out of a workforce
filling the gap of bad functioning infrastructure. In contrast, of 478.3 million pay their taxes. This again is only around
for the Indian case this will not be possible without public 0,5% of total GDP in India. Having tax exemption for the
intervention. The Indian government is well aware of the fact people working within agriculture is one of the main reasons
that their infrastructure development is not keeping up with for this, but it also has to do with the fact that a considerable
the average economic growth rate, and for this reason they proportion of Indian retail sales take place in the unorganized
have had as a strategy to invite private investors to join the sector.
development. In 2006 they also established the IIFCL: Indian
Infrastructure Financing Company Limited to facilitate the de-
velopment. Looking back at the Commonwealth Games that
were hosted in India in 2010, one might question whether

IB International Business India 45 |

 Tax income to the government being so modest, financing to-be urban areas. New schools and housing complexes are
sufficient infrastructure for the whole country is an almost needed in these newly developed communities.
impossible task. Historically, Indian politicians have subsi-
dized electricity and water for farmers to gain votes during Even though India is in fact lagging behind on infrastructural
elections. You could say it is like a vicious circle because matters, we need to keep in mind that what we as foreigner
when the party in opposition is promoting subsidized power may think of as chaotic systems actually might be function-
to the farmers, the party in power cannot do anything but the ing very well. In traffic as well as other areas there seems to
same to be reelected. This has also somewhat discouraged be chaos and anarchy when there in fact exists an intricate
private investors to invest in these rural areas. set of rules. Take for instance the lunch delivery system in
Mumbai. Each day 5000 men on bikes deliver hundreds of
THE SHADY SIDE OF THE BUSINESS is also worth mention- thousands of lunches made in the suburbs to workers in
ing in the case of the Indian infrastructure. Many parts of the city center. This fascinating system is actually ranked
the public sectors are somehow involved in corruption, this by Forbes as efficient as many big technology systems. For
ranging from the neighborhood police officer to the district an outsider, however, this looks like a rather uncoordinated
bureaucrats to governmental parties. According to the watch- business.
dog group Transparency International, Indian truckers pay on
an average close to $ 5 billion a year in bribes. Kick-backs ONE MIGHT ARGUE that in order to develop the infrastruc-
and other arrangements are widespread, especially in the ture more rapidly and efficient, the Indian mindset is what
contracting industry. Hence, corruption also delays infra- needs to change. We are well aware of the fact that Indians
structure projects. The continuous negotiation also results in in general has a more relaxed approach to time and thereby a
many public projects either going over budget, lacking sus- different aspect of efficiency.
tainable quality or never being completed. A recent infrastruc-
ture study shows that the proportion of Indian infrastructure TO SUM UP, the poor infrastructure is, like the heavy bureau-
running behind or having cost escalation projects is as high cracy, the price you have to pay for a 1.2 billion democracy.
as 50%. The cumbersome processes and the apparent inefficiency
and lack of coordination make patience a necessity for for-
IN TERMS OF THE SOCIAL INFRASTRUCTURE, India is eigners doing business in India. Local knowledge and expert
also facing big challenges. The Indian population is vast and help is also required in order not to get too bewildered and
fast growing and it has been a trend the last decades that paralyzed by the overwhelming complexity.
people migrate to the big cities for work. This has made the
real estate prices skyrocket and some places the prices have
doubled in the past years. As the existing cities get more and
more crowded, new urban areas pop up. The big cities will be
metropolises, smaller cities will get bigger and new cities will
be established. As for now 2/3 of the Indian population live
in the rural areas and it is forecasted that more rural centers
will be established in the nearest future as more retail sales
will be developed in these areas. It is therefore crucial for
the government to keep up with the development in rural and

46 | IB International Business India

 BUSINESS IN INDIA

// REGULATIONS, BUREAUCRACY AND LAW

ENFORCEMENT

IT IS BEYOND THE SCOPE OF THIS PROJECT to go into inherent skepticism and a need to protect national stakehold-
details about which laws and regulations apply to Norwegian ers. This “one step forward, two steps back” scenario clearly
companies entering India. There is a jungle of regulations and causes frustration and is a considerable risk element for
the Indian bureaucracy has a reputation of being one of the foreign investors.
messiest and heaviest worldwide. In 2011 India ranked 132
(of 183) in the World Bank’s annual ranking of countries in
ease of doing business. The ranking involves the parameters LOCAL AND REGIONAL DIFFERENCES
starting a business, dealing with construction permits, get- Whatever the aspect within doing business in India you are
ting electricity, registering property, getting credit, protecting discussing, the importance of local knowledge cannot be
investors, paying taxes, trading across borders, enforcing stressed enough. In fear of being repetitive, the local and re-
contracts and resolving insolvency. If considering entering In- gional differences within India are major and crucial. Below is
dia it is important to gather accurate and up to date informa- a subranking of the ease of doing business ranking showing
tion from experts in these areas. This section will merely give the regional differences within India.
a brief analysis of the Indian bureaucracy overall, why it has
developed this way and the implications for foreign investors.

ONE STEP FORWARD, TO STEPS BACK – AN EX-COLONY’S

SKEPTISISM
When asking foreign companies what they find the most
challenging when doing business in India, the majority will
most certainly reply the heavy bureaucracy and unpredict-
able regulations. But if India wants to grow further and lift
additional millions of people out of poverty, why make it so
complicated and risky to do business and enhance economic
growth? Why this resentment to injections of healthy foreign
capital and knowledge? It is reason to believe that part of the
answer is found in history. Keeping in mind that the British
initially entered as a trade company, the East India Company,
it is no wonder there is some hesitation and resentment to
foreigners who want to enter for trade and investments. The
British came to rule the country and exploit it for trade for a
long period of time and clearly India do not want something
similar to happen again. However, executed properly, interna-
tional trade and investment from foreign companies undoubt-
edly enhances growth and development in India and thereby
benefit the country as a whole. This dissonance might be one
of the reasons why we see such unpredictable attitudes in the
regulatory environment in India today. History has created an

IB International Business India 47 |

48 | IB International Business India
 BUSINESS IN INDIA

THE PRICE TO PAY FOR DEMOCRACY mechanism in society fails, the answer from the government
How come China and other fast growing nations appear to is a new law. However, resources are not put aside to enforce
be so much quicker in decision making than India? A part these laws, he claims further. Only have as many laws as you
of the answer is in the way the countries are ruled. Whereas can enforce, he concludes.
communist China can enforce laws and regulations over-
night, democratic India debates everything causing slow
and inefficient processes. Brought to a head, one can claim
that the heavy bureaucracy is the price you have to pay for
democracy. Running a 1.2 billion nation where everybody has
a say in everything creates slow and cumbersome decision
making processes. For India, this inefficiency might be worth ECONOMY EASE OF DOING BUSINESS RANK
it as they want to keep and protect their democratic way of
ruling the country. For foreign investors, on the other hand, Ludhiana 1
this inefficiency and unpredictability is a major source of risk Hyderabad 2
and frustration. An example is the case of Uninor in Delhi.
Uninor is a telecom company owned by Norwegian Telenor Bhubaneshwar 3
Group (2/3) and Indian Unitech Wireless (1/3). In order to Gurgaon 4
offer their services in a telecom circle (a geographical area) Ahmedabad 5
they need a license and spectrum. In the Delhi circle they
have the license and are just waiting for the government to New Delhi 6
offer them the spectrum they need for operation. They have Jaipur 7
been promised spectrum, but they do not know when it is
going to happen and the promise might even be withdrawn. Guwahati 8
Unpredictability like this is costly for businesses and might Ranchi 9
scare foreigners away from entering India. (Editor’s note: And Mumbai 10
look what happened! The government withdrew the licenses
altogether, cf the introduction of this report, causing a major Indore 11
crisis for Telenor.) Noida 12
Bengaluru 13
LAW ENFORCEMENT Patna 14
When travelling in India you see uniformed officers ev- Chennai 15
erywhere you go. Security officers, traffic officers, police
officers, parking officers, you name it. Still many of the Kochi 16
Indians we have met and talked to complain about poor law Kolkata 17
enforcement and a laissez-faire attitude from the public law
enforcement bodies. An Indian manager of a Mumbai branch
of a Norwegian company stated that it is the enforcement and
not the legislation as such that causes problems. Whenever a

IB International Business India 49 |

50 | IB International Business India
 BUSINESS IN INDIA

// CORPORATE SOCIAL RESPONSIBILITY

(CSR)

CORPORATE SOCIAL RESPONSIBILITY IS A WIDE CON- included in the CSR policy, they might be more motivated
CEPT. Some of the key elements are community involvement, when experiencing that their company is contributing to the
fair trade, human and labor rights, and reduction of pollution. society.
CSR is defined in many ways, and the market perception of
CSR varies a lot between the countries. In China, a common ONE COMMON PART OF THE CSR POLICY IN INDIA IS TO
understanding of CSR is about high quality products, while SUPPORT A NON-GOVERNMENTAL ORGANIZATION (NGO)
in the UK it is about being environment friendly. The World acknowledged by the United Nations (UN). NGOs work to
Council for Sustainable Development uses the following increase the life quality for the underprivileged. Illiteracy and
definition: school dropouts are huge problems in India, and the NGOs
are playing an active role to change this and develop the
”CSR is the commitment of business to contribute to sus- education sector. The willingness of contribution from the
tainable economic development, working with employees, private sector is becoming a big trend and an important part
their families, the local community and society at large to of the CSR strategy. During our company visit at Kongsberg
improve their quality of life.” (WBCSD) Maritime, we visited the NGO School Gyan Vikas Kendra in
Navi Mumbai, which is the NGO that they are supporting and
THE GLOBAL TREND IS NOW THAT COMPANIES ARE donating money to as a part of their CSR policy. In addition
SPENDING MORE MONEY AND ATTENTION ON CSR, and to educating the kids, the NGO also offers sewing courses for
it is continuing to increase. The enhanced awareness of young women, so that they can make garments and sell them
CSR is reflected through the massive focus it has had in the to earn money. Computer training is also offered to unedu-
media through the last few years. The same results are also cated adults. In addition, hot meals are provided during the
replicated through several surveys, for instance 70% of global day and some of the mothers of the kids are also employed
chief executives agree that CSR is vital to the profitability by the NGO as chefs and helpers. The NGOs are of great
of any company. The same tendency is also found among importance for the people that live in the slums, and educa-
the consumers. 44% of European consumers surveyed are tion is probably the only ticket out of the slums for these kids.
willing to pay more for environmentally and socially respon- The trend is now that people understand the importance of
sible products. India is no exception. The Indian regulators education, and the parents prefer that their kids take educa-
have pledged to introduce tougher governance rules to tion rather than working. This used to be a challenge for the
prevent misuse of the corporate responsibility. But the key NGOs earlier, since the majority did not recognize the value of
to the global social responsibility lies among the companies. education and wanted their children to work instead.
Hence, the CSR policy should not be neglected.
HOWEVER, WHEN CHOOSING A NGO TO SUPPORT ONE
THERE ARE MANY REASONS WHY CSR SHOULD BE MUST DO PROPER RESEARCH TO MAKE THE RIGHT DECI-
IMPLEMENTED IN THE STRATEGY when going abroad, SION. Many fake NGOs take advantage of the generosity
and of even higher importance when entering a developing among companies. To avoid these fake NGOs, preparations,
country such as India. Corruption, poverty and child labor are research and follow-up must be done thoroughly. Therefore,
widespread in India hence the CSR policy can be critical to a good idea would be to visit many different NGOs before
succeed. Risk reduction, increased profitability, and improved choosing one. When you have found one of high credibility,
reputation are just a few of the positive side effects of a good it is still important to do several follow-ups to make sure that
CSR policy. As mentioned, the different cultures and their the donations are properly spend.
perceptions of CSR might be very different from the stan-
dards followed in Norway. THE CSR POLICY COULD ALSO RESULT IN INCREASED
PROFITS. By marketing their brand successfully as a sustain-
Therefore, the CSR policy should be integrated at the begin- able, respectable brand, it will attract customers and suppli-
ning of the process. By communicating the CSR policy right ers, which will directly influence profits. Risk reduction is also
away and focusing on due diligence, one might avoid getting an important reason to focus on CSR, since the political risks
into problems at a later stage. Even though this might be are taken into account hence, the possibility of succeeding in
more time consuming at first, it could save a lot of work another country will then increase. In India, volunteering and
later. For instance, one of the biggest challenges when doing charity work are also rewarded with tax savings.
business in India is to retain and attract the best people.
Firstly, by having a reputation that the company is fulfilling
market expectations and takes responsibility for a sustainable
development, it will appear more attractive for the job seek-
ers. Secondly, CSR could also improve the work environment
and create a better sense of belonging. If the employees are

IB International Business India 51 |

 // CORRUPTION

”THE CORRUPTION PERCEPTIONS INDEX” (CPI) ranks of corruption is probably the most hazardous, that is the “hid-
countries/territories based on how corrupt their public sector den policy corruption”. Politicians are the ones that have the
is perceived to be. A country/territory’s score indicates the opportunity to change the system, but as long as they do not
perceived level of public sector corruption on a scal e of have the incentive to do so, the problems will continue. This
0 - 10, where 0 means that a country is perceived as highly leads to policy errors such as not establishing good systems
corrupt and 10 means that a country is perceived as very to plan cities and infrastructure, and non-functioning laws
clean. A country’s rank indicates its position relative to the and institutions. As long as this form of corruption exists, the
other countries/territories included in the index” (CPI 2011). society cannot function perfectly even if it has free markets
and a democratic rule. The dishonest leaders and their
IN 2011 INDIA WAS RANKED WITH 3.1 OUT OF 10 (95 disinterest in good policy will not make it possible to create a
OUT OF 182), which indicate the great extent of this problem. prosperous society. Hence, corruption is probably one of the
Corruption is widespread in India, and is observed in almost biggest challenges facing international companies doing busi-
every aspects of the society. The public sector seems to ness in India. Consequently, international companies should
be more exposed than the private sector, and the extent of put a great effort into prevent and fight corruption.
corruption also varies within the different areas of India and
between the distinct industries. A very strong movement to EVEN THOUGH CORRUPTION IS WIDESPREAD IN INDIA, it
prevent corruption are now arising, but any concrete signs of is possible to prevent and avoid it. The development is now
immediate improvement are unlikely. It takes time to change going in the right direction. India has a very independent
the mindset and acceptance around corruption, and the tough and critical press, which puts pressure on the politicians to
bureaucracy and many regulations make the change process change, and make this a priority on the political agenda. The
even slower. growing and more educated middle class also tend to accept
facilities payments and bribes less than before.
THE PERCEPTION OF CORRUPTION MAY SEEM CLEAR
FROM A NORWEGIAN POINT OF VIEW, but when doing CORRUPTION IS A CHALLENGE FOR NORWEGIAN COMPA-
business in India it is important to remember that this might NIES SEEKING INTO BUSINESS OPPORTUNITIES IN INDIA.
be part of the business and everyday life for many Indians. The importance of doing the homework before entering an
Corruption is present at different levels, and in order to fight area with widespread of corruption cannot be emphasized
and prevent it, it is necessary to understand the concept. The enough. Preparation, due diligence and spending time on
first level of corruption is “the visible part”, which is related contracts and choosing partners or agents is critical. When
to “daily life activities”, such as a bribe to avoid getting fined considering risk elements and doing the country analysis, it
or bribes paid to a governmental institution to get a service is important to be aware of this and how to avoid it. Before
that they were actually entitled to get without a bribe. The entering India it is advisable to spend a lot of time on finding
“hidden deep corruption” is typically found among govern- the right partner, and also work with the potential partner for
mental institutions. Police, education and health services, some time.
and public departments are examples of such institutions.
One problem with the police force in India is that their wage PRACTICAL SUGGESTIONS for avoiding and combating
is very low; hence, it is almost compulsory that some of their corruption is to avoid cash transactions and prefer payments
income should come from facilitation payments. The lack going through banks, as well as formulating a clear anti-cor-
of solid independent institutions is therefore one of the main ruption and anti-bribery policy, communicate it to all employ-
problems when it comes to corruption in India. The third level ees, and make breaching it a disciplinary offence. There is

52 | IB International Business India

 BUSINESS IN INDIA

always a risk that the employees could get involved in cases

with corruption. They either benefit from personally or just act
in accordance to what they believe is in the company’s best
interest. As mentioned in the part of business culture, the
features of the fundamental Indian business culture might be
part of the reason why corruption is so widespread. To make
the intolerance of corruption stronger it is therefore important
to train the employees. For instance, Aker Solutions in India
have a very strict policy against corruption, and it is compul-
sory for all employees to take a course in business ethics.
This reduces the risk of getting involved in an undesirable
situation; hence, it is advisable to educate the employees on
the consequences of getting involved in corruption from the
beginning. This also signals to all counterparts and custom-
ers that their company does not accept corruption. The
second largest Indian company, the Tata Group, is another
example of an Indian company that have succeeded with an
ethical strategy, and are well known for its strict anti-corrup-
tion policy.

FINALLY, ENTERING HIGH-RISK COUNTRIES SUCH AS

INDIA COULD RESULT IN VERY PROFITABLE OUTCOMES IF
YOU SUCCEED. It is always a question about the risk versus
the advantages. As long as you take precautions and do the
homework beforehand, corruption is one of the aspects that
could be handled. By using negotiation power and the tech-
nological advantages within the Norwegian companies, you
can reduce the risk of getting involved in illicit activities.

IB International Business India 53 |

 // INTERVIEW:
PROGRAMMED TO PROGRAM

A CHEAP, SKILLED AND FLEXIBLE WORKFORCE AT- South American countries like Argentina where wages are
TRACTS FOREIGN COMPANIES TO INDIA FOR IT BUSINESS still low and the cultural gap not as wide.
OUTSOURCING. Call centers and programming divisions pop
up like weed in cities like Bangalore and Chennai. We asked What do you think about the future of India as an IT nation?
the founder and CEO of a Norwegian performance manage- - When it comes to outsourcing we already see that quite a
ment software company to describe benefits and challenges few companies prefer Latin and South America to India. Like
concerning operating such a division in India. I said, the labor costs are still low there and the mindsets
more aligned with the Norwegian. Also, the infrastructure is
- First of all, the cultural differences are significant and need more supportive. In India, office space, internet connections
to be paid serious attention to. Both in general and in busi- and other necessary supplies are very expensive. The bu-
ness the mindsets are completely different and we found reaucracy ensures long supply chains that become tremen-
that having Norwegian management in the Chennai office dously costly and inefficient. This is a considerable downside
was useless. They couldn’t get anything done because it was with India as an expansionary or cost saving opportunity.
difficult for them to read the codes and besides be tough
enough and strict enough. Norwegians tend to have flat What about the “c-word”? Do you have problems concerning
organizations and a high degree of equality in business com- corruption?
pared to hierarchical India, and to manage Indian employees - Not much, luckily. There was one incident in the beginning
you need to be able to act authoritarian. Norwegians used to where an employee slid some money under the table to get
manage Norwegian employees are not familiar with this kind our company name registered. This person was of course
of behavior. Our office now has Indian management. dismissed from its position.
- Another aspect to keep in mind when considering India
- Also, efficient Northern Europeans like ourselves might be for your venture is company loyalty. My impression is that
surprised by the seemingly inefficient way to do things in educated Indians are career oriented and cynical when it
India. We like to think that time is money and that cost effi- comes to company loyalty. They don’t count years of tenure,
ciency is always best practice, but in India they have no such they count months. They prefer working for big companies
attitude concerning time and efficiency. The bureaucracy is rather than small ones and care a lot about company reputa-
a hassle and you often find yourself caught in some sort of tion and image. A problem with regards to this is the fact that
bureaucratic catch 22. Like when we for instance wanted to a Norwegian company might end up investing a lot of money
open a bank account, you needed to have a registered firm. in training and employee development and that the employ-
But to register a firm you needed a bank account. And so on. ees quit before the company benefit from the learning.
Everything concerning laws and regulations is hard to sort
out. Doing business in India is because of this very unpre- - On paper it is definitely cost efficient to outsource some
dictable and hence risky. tasks to India. However, the challenges related to operating
in a country with a fundamentally different mindset are con-
- A great advantage about India is that the fact that they siderable, and we are unsure whether it has paid off all in all.
speak English very well. This makes business across borders
a lot easier compared to other countries. In addition, they
are highly skilled in what they do. The problem arises then
they have to think critically or analytically as they are used
to following strict orders. I believe this is supported by the
school system in India. They learn to memorize, not think
critically and analytically. Extremely specific instructions are
needed when requiring e.g. programming or implementing
as they are not used to making independent decisions. This
takes a lot of effort from Norwegian system developers, and
sometimes you might find it easier to just do it yourself. In
order not to lose face they also tend to be dishonest about
how much work they can take on. They resent admitting that
they do not have the time or competence to complete a task,
and just carry on until deadline when the incompleteness is
revealed. This is in great contrast to frank Norwegians who
do not have problems revealing weaknesses or limitations to
their superiors. We find obstacles like these very challenging
and consider moving to other countries such as Latin and

54 | IB International Business India

 BUSINESS IN INDIA

// HOW TO ATTRACT AND KEEP TALENT

THE LABOR FORCE IN INDIA WAS 478.3 MILLION IN 2010,

and it is expected that around 13 millions will enter the urban
labor force every year. With a well-established education
system, and a very young population with a median age at 25
years, the potential to find talented employees is very high.
The majority of Indians are still not working or uneducated,
but with a population of 1.2 billion it is easy to find well-qual-
ified employees. The low cost of labor is one of the biggest
advantages when doing business in India, especially for labor
intensive companies.

INDIA IS A MEMBER OF THE INTERNATIONAL LABOR

ORGANIZATION (ILO) and has developed comprehensive leg-
islations to provide a good working environment for human
labor and protection of their interests. But it does not facilitate
any welfare benefits, so the trend is now that the companies
provide these goods. Security and flexibility are getting more THE DISTRIBUTION OF THE LABOR FORCE BY OCCUPATION
important for the candidates that are seeking jobs. Hence, to
be competitive and attract the best people it is important to
offer such goods.

HEALTH INSURANCE, REIMBURSEMENTS FOR DENTAL

CARE AND OTHER FACILITIES FOR THE FAMILY are benefits
that are getting more widespread among the largest com-
panies. To attract the best people and also be able to retain
them is a challenge. Indians are very career oriented and
eager to get relevant experience, as a result they tend to
change their jobs more frequently compared to Norwegians.
Providing attractive benefits for the employees is the essential
to keep the best people.

AN EXAMPLE OF A COMMON BENEFIT offered to the em-

ployees is transportation to and from the office. The traffic is
very chaotic and unpredictable in the cities, and the train is
literally packed during office hours, so offered transportation
ease their way to the office. This also provides security for
people working late hours. Flexi-time and working different
shifts are also getting more popular. Indians generally has a
high working capacity and work long hours, which results in
less time to do their domestic duties and taking care of their
children. Especially this is a big challenge for women and
many have to choose between the two. Facilitating for flexi-
time consequently encourages women to remain working.

OTHER ARRANGEMENTS provided to ease the working life THE DISTRIBUTION OF POPULATION BY EDUCATION
for families is for instance kindergartens at the office and ex-
tended maternity leave. Women are only entitled to get three
months leave, which often result in a lot of women quitting
their job when they have a child. By extending their leave and
offering benefits that makes it more convenient to combine
work and family is therefore important to keep the female
resources.

IB International Business India 55 |

56 | IB International Business India
 BUSINESS IN INDIA

// THE INDIAN CONSUMER MARKET

DOMESTIC CONSUMPTION COUNTS FOR 65% OF TOTAL SOUTH

GDP IN INDIA, and with a growth of 7- 8% every year, this is In the South, the IT and technology industry is sizeable. There
a country with great opportunities. Because domestic con- is a low fraction of illiteracy among the people and many are
sumption accounts for such a large proportion of GDP, India highly educated. The people tend to be diligent, appreciate
manages to still have a growth rate of 6.8% during the finan- steadiness, and be rational. The positioning strategy should
cial crises. Modern technology, increasing urbanization, an focus on logic and technology.
emerging middle class, increase in purchasing power and a
structural shift from an agrarian to a service driven economy WEST
changes the lifestyles and consumption pattern of Indians. The western part of India is a metropolitan area. The people
are more open-minded to new products and want to have
DIVERSITIES AND OPPORTUNITIES a bit of everything. The market for technological products
There are huge differences within the country. And with a is very big in this area, because the demand and compre-
population of 1.2 billions it is impossible to find the “average hension of these products are higher than other areas. The
Indian” or the “average consumer”, hence, local knowledge people tend to be more democratic and have an egalitarian
and research is necessary to know which market your brand attitude. Nielsen argues that they have a more “calculating”
is most likely to succeed in. The diversities among eating attitude towards money. Regarding products, they seem to
habits, language, religion and culture require a great focus appreciate financial products. Since more and more people
on adaption of products and branding in the different areas. are working in the big financial cities in the western zone,
A popular product in the north might be a failure in the south, men and women, RTE (Ready-To-Eat) products has experi-
and the same pattern is also found within a smaller area. One enced an enormous growth due to the convenience. Thus, it
part of Mumbai may have very different preferences from will be beneficial to play on convenience and benefits of the
another part of the same city. Local knowledge is therefore products in marketing communication.
critical for new entrants. At a generic level, India is divided
into four zones in terms of consumer behaviour: north, south, EAST
east, and west. Nielsen has managed to identify different In the east, people are somewhat more concerned about
characteristics of each zone concerning the people, the health issues, nutrition and preoccupations. Other factors are
products and positioning. intellectualism and it is said that they have an evolved sense
of humour. When it comes to products; nutrition, health and
NORTH OTC products in general, are in focus.
The northern part of India is often identified by a masculine
culture. Consumers in the North are very concerned about THE RURAL MARKET
status, and have a “macho-style”, people “live to work”, About 70% of all Indians live in the rural part of India. FMCG
instead of “work to live” as is common in a feminine culture. (fast moving consuming goods) sales in the rural parts count
The people is said to be large-hearted as well as emotional for US$10 billions and are growing rapidly. With a market
effusive. Well-established brands and more expensive worth estimation at about US $3 billion, the number speaks
products are likely to succeed in this area, as people are very for itself. The opportunities in this market are enormous, but
focused on status and having an “admirable lifestyle”. As the competition is also high, and the challenges concerning
the only area in India without a coastline, processed food are the infrastructure also need to be taken into account. There
more common in this part of the country. seems to be a strong correlation between the government’s

IB International Business India 57 |

GDP GROWTH RATE

PRIVATE CONSUMPTION EXPENDITURE (INR TRILLION

FAST FOOD EXPANSION

58 | IB International Business India

 BUSINESS IN INDIA

FROZEN FOOD BILLION US.DOLLARS

FOOD CONSUMPTION BILLION US.DOLLARS

rural schemes and FMCG consumption, since the local job FOOD COMSUMPTION AND FOOD PROCESSING
opportunities that are created results in a higher purchasing Food is the largest consumption category in India (Nielsen).
power. The income in the rural areas was earlier dependent The graph to the right shows the development of food con-
on the monsoon, while it now seems to be stabilizing. sumption in India. The left axis is quoted in billion USD and
Another trend in the rural areas is a large shift from com- its compound annual growth rate is approximately 5.3%. This
modity to branding. The people are now more conscious growth is accompanied by changing eating habits. According
about the brand, so before entering these markets, having to Nielsen this is changing because of the development of the
an established name in the urban areas is a great advantage. society. Especially the food processing industry is expected
The consumers want to have the same products as are found to grow at a fast rate in the coming years. The Ministry of
in urban India, and they follow the same trends. For instance, Food Processing Industries has formulated a Vision 2015 ac-
even though the standard of living is still very low, the con- tion plan which includes trebling the size of the food process-
sumers prioritize mobile phones and TVs. For that reason, the ing industry, raising the level of processing of perishables
producers are now thinking of new ways to accommodate from 6% to 20%, increasing value addition from 20% to 35%,
these needs. One example is the launch of the low priced and enhancing India’s share in global food trade from 1.5% to
TV range “Cineplus” and “Sampoorna” from LG for rural 3% (Nielsen).
markets. The Tata Nano car is another example of innovations
made to meet the rural markets. The Tata Nano car is the The expected increase in demand of processed food is driven
cheapest car in the world and a convenient and safe substi- by the following trends:
tute for the common three- and two-wheelers. - Increasing urbanization – lifestyle and aspirations
- Changing demographics – rise in disposal incomes
THE RISING MIDDLE CLASS - Organized retail and private label penetration
The rising middle class is leading the consumption boom - Demand for functional foods
in India. The increased wealth and rise in purchasing power - Increasing nuclear families and working women
and easy access to information and communication technol- - Increasing spending on healthy food
ogy has changed their consumption pattern. They are now
becoming more aware of the value that the premium products RETAIL
offer, and are seeking high quality. They don’t mind paying The frozen food segment will grow from 1.8 billion USD in
more for a product as long as it is of high quality. But - if it 2008 to 2.6 billion USD by 2014. This growth has been fu-
does not meet the expectations they would quickly change to elled by the increasing availability of freezer space in modern
a different brand. The Indian consumer is now more affected retail shops. The graph on the left side shows number of
by their friends’ opinions. Earlier they only used to ask the outlets and expected growth among the most important fast
family for advice. Consequently, they are now more open to food chains.
trying new products. Women are also getting more in charge As the graphs shows, there is anticipated a huge growth in
when it comes to larger purchases. The women are becom- the fast food market. People are slowly changing preferences
ing more educated and every second job in the organized and they become more international in their eating habits.
sector is given to a woman. Consequently, women are now Therefore, there is a market for new products and it supports
buying financial goods, insurances and larger purchases that the expectations of increased demand for processed food.
traditionally were done by men. Also, there is a change from a vegetarian diet to a non-
vegetarian diet.

IB International Business India 59 |

60 | IB International Business India
 BUSINESS IN INDIA

// INTERVIEW:
IN IT FOR THE LONG RUN

DURING OUR STAY IN MUMBAI, KONGSBERG MARITIME as this can be compensated in higher quality or a high level
HAD ARRANGED MEETINGS AND ACTIVITIES FOR US in service, it should not be too big of an obstacle. Person-
so that we could obtain important insight in their activities ally, I think Norwegians have an advantage when it comes to
as well as get to know the people and the culture from the collaboration with the Indians, compared to many other na-
inside. To shed a light on a Norwegian success story in India, tions. I think we fit well together and struggle less than other
we asked the Vice President of Kongsberg Maritime Offshore Western countries when it comes to cultural differences. The
and Business Support, Lars Granbakken, to describe the lower hourly wage for engineers is also a great advantage
advantages and challenges of operating in India. that should be mentioned.

- The reason why Kongsberg decided to enter India was that - When considering challenges of doing business in India,
we wanted to work with the customers with our own employ- corruption is a well-known barrier. There is a lot of corruption
ees, and not only through distributors and agents. We pro- among the police force and the public employees. But what
vide sales, service and delivery of our own products to the we have done is to be clear from the beginning of all relation-
Indian market. We are also able to run a low cost operation ships with customers, suppliers, and the public sector that
in India, with access to engineering services at a significantly we do not tolerate corruption. And that works. As long as you
lower cost than in Norway. This is not on the expense of our are clear on this from the start it can be avoided. Another
Norwegian workforce, but in addition to it. huge obstacle is the infrastructure. Frequent power outages,
slow traffic and always something missing, like gas or water
- For nearly 30 years Kongsberg has worked with a local etc. is a problem. Concerning this issue, my best advice is
partner in India and done sales and deliveries from abroad. to think more like the locals and be patient and flexible. More
So when we decided to set up a branch with our local part- practical things can also be done to minimize these prob-
ner, we did not experience any huge obstacles. I believe the lems, for instance by having a generator for power outages.
reason for that was that we already had extensive experience The bureaucracy is also worth mentioning when considering
and had worked with our partner for so long. Without own the challenges; it is still one of the hardest countries in the
experiences and a local partner, I think it would have been world to do business in. The decision making processes are
very difficult to succeed. For other companies considering slow and everything takes a lot of time. On the other hand,
India, it is advisable to take plenty of time choosing your the advantages of being in India compared to other countries
local partner. I would recommend spending around 2-3 that we are established in, is the great access to expertise,
years to get to know the potential partner. Preferably work good knowledge of English and a democracy that accepts
with them to get experience from real cooperation and to get many of our values. In addition, it is also reasonably safe to
proof that they are providing what they promise. There is an travel around. And personally I find it much more exciting to
endless queue of promises. Many Indian companies want to do business here compared to many developing countries
work with Western companies, but very few manage to keep that are copying the European and American styles.
the standards we expect. I therefore believe in trial and error,
and gaining experiences through failure and success. - On the question of what I think is most important for
Norwegian companies to consider before entering India, I
- A lot has changed in India since we first entered. Firstly, the must say that I do not think it is easy or possible for a small
costs are rising quickly. For instance the wage increases by company do to so. Since I believe it takes 2-3 years to find
18% annually. Just during the past five years it has changed a good partner and get the right set-up, a small company
as much as the 25 preceding years. Most projects run over will not have the resources to do the necessary long term
several years, and it is a high level of uncertainty about how investments. I have met a number of Norwegian companies
well India will succeed within the maritime industry. India has in India that are very disheartened by the obstacles. Many do
all the conditions necessary to build cheap ships, but in the not understand the endurance that is necessary to succeed.
short term it does not seem like this is going to be realized
in any large scale. The problems lie in the infrastructure, - Thinking long-term is a strategy in itself. We build our own
and all the internal contradictions. But as the fourth largest house as an element of showing that we are in it for the
economy in the world, it is a country we have to recognize long run. We want to be in position when the market takes
in the future even though there are differing opinions about off even more. Also, it is important for us to be close to our
where they will be in ten years. current customers. Kongsberg Maritime is dependent on the
development of the maritime industry in India, but the extent
- The competition in India is very tough on prices. It is very and pace of the actions is still uncertain. Anyway, Kongsberg
common to be more concerned about price than quality, is definitely in it for the long run.
which could be a disadvantage for Norwegian companies
since we normally tend to have higher prices. But as long

IB International Business India 61 |

 // NORWEGIAN ENTREPRENEURSHIP AND
OPPURTUNITIES IN INDIA

NORWAY IS OFTEN RATED VERY LOW WHEN IT COMES SO WHAT DOES ENTREPRENEURSHIP DO FOR A COUN-
TO INNOVATION and entrepreneurship compared to other TRY? IT IS REALLY NECESSARY? Even though it is not for
countries, but we score high on resources and technology everyone, entrepreneurship has many benefits both on a
available for creating value. Innovation is often not prioritized personal, regional, national and global level. It creates jobs,
in Norway as there are a considerable number of industries has positive impacts on the economy, might solve social is-
already providing the country with a sustainable economy. sues and benefit many people. Entrepreneurship, in whatever
But what about those countries where the resources are form, is necessary for a country to be sustainable and for
lacking, but the opportunities are lined up and the culture its economy to be able to grow. Some countries need this
is very entrepreneurship friendly? India is such a country. growth more than others. India is such as country.
Norway should relocate its resources and make use of them
in countries such as India where the possibilities and need THERE ARE OBVIOUSLY MANY WAYS IN WHICH NORWAY
for innovation and entrepreneurship is larger and the value AND INDIA DIFFER - socially, culturally, politically and others.
created could have huge impact on less fortunate people and One of the most obvious ways the countries differ is by their
economies. size and their population. Norway has a population of about
5 million people while India accounts for over 17.5 % of the
THERE ARE SEVERAL DEFINITIONS OF WHAT IS CONSID- world’s population with its 1.2 billion inhabitants. These other
ERED TO BE ENTREPRENEURSHIP. Entrepreneurship is more differences really point out how different the countries are to
than the act of starting your own business. It is a process live in (see diagram on next page):
where individuals identify opportunities, target resources and
create value. This value will often be perceived differently de- SEEN FROM THIS COMPARISON, THERE ARE MANY WAYS
pending on social and economical circumstances. Entrepre- IN WHICH INDIA COULD IMPROVE. This does not mean do-
neurs approach problems as opportunities, sometimes not ing things the same way as in Norway. As the countries are
intentionally. Entrepreneurship also includes the willingness of too different on many levels, a system that works in Norway
taking on risk. Some people become entrepreneurs in order to might not work in India. On the other hand, what this com-
make a living, help the society or just for fun. Based on this parison does imply is that Norway has resources available
there are several different types of entrepreneurship, depend- and fewer areas to apply them to in order to solve problems.
ing on its purpose and the value it aims to create. It might One reason for Norway scoring so low on entrepreneurship
be classified as social entrepreneurship, aiming to improve ratings is that the creation of entrepreneurship itself requires
social, economic, educational and environmental situations the availability of business opportunities and problems. Hav-
in certain areas. The desire for profit is not as demanding ing the resources and people available, as Norway has, is not
within this type of entrepreneurship, and the value created is enough to create entrepreneurship and innovation.
not measured as such. Sharing the same feelings about profit
is the lifestyle entrepreneur, putting passion for the problem NORWAY IS CURRENTLY LISTED AS THE 18TH MOST IN-
before the desire to profit from it. Having succeeded or failed NOVATIVE COUNTRY IN THE WORLD, where India is too low
with several ventures, the person would be referred to as a on the list to even get mentioned. The number of scientific
serial entrepreneur. and engineering researchers per capita also put Norway
ahead of India in terms of resources. Finland takes the top
spot, followed by Sweden, Japan, Singapore, and Denmark.
Norway, Australia, Canada and New Zealand round out the

62 | IB International Business India

 BUSINESS IN INDIA

top ten. As for the BRICS: Russia is 12th, India 36th, China problems. Incubators are nowhere to be found in the rural
39th and Brazil 43rd. None of the BRIC (Brazil, Russia, India areas, especially in India, and the solutions used by the lo-
and China) countries rank very highly on the Global Technolo- cal were ineffective and unsafe. By developing a small bag
gy Index. Russia, in the 21st spot, ranks highest, China ranks containing a portable phase change material in the back, the
30th (about the same as Lithuania), Brazil is 41st, and India locals are now able to keep their premature babies warm for
42nd. India along with Indonesia, the US, Canada and Austra- only $25, about 0,1% of the cost of an incubator. The phase
lia, has been ranked among the nations with the best cultures change material is simply heated up in boiling water and it
in the world for people to start a new business, according to will keep a temperature approximate to the human body for
a global poll released today, and in India, 75 per cent say that 4-6 hours. Not only does this save many lives at practically
their country values innovation and creativity. So what does no cost, it also makes sure people do not make too many ba-
this really tell us? While India is rated as the worlds 4th most bies in the anticipation of losing most of them. By approach-
entrepreneurship-friendly nation, Norway is rated fairly high ing a huge problem with a simple and cheap solution, Jane
on the innovation ratings. Clearly the other country is stronger and her company is able to have an impact on the Indian
where the other is weaker. What measure could be taken to economy, death rate and even its overpopulation.
take advantage of these shortcomings and strengths?
JANE AND EMBRACE IS A GREAT EXAMPLE OF WHERE
BOTH OF THE COUNTRY’S EMBASSIES ARE WORKING HAVING THE RESOURCES, economic and intellectual, and
HARD TO PROVIDE INFORMATION AND GUIDES, together how innovative thinking can be used to solve problems in
with Innovation Norway, to businesses in Norway with an other countries than your own. This is exactly what Norway
interest in doing business in India. India, along with the other should do in India. Use all those additional resources to solve
BRIC countries, is considered to be a country with large problems and opportunities so clearly evident in the Indian
economic potential, and is therefore delegated resources for society and economy. The Norwegian government should
pursuing this. Most of these initiatives are focusing more make a stronger effort to exploit the resources of its country
on already established Norwegian companies, and how and the minds of its innovators in order to have an impact
these can expand into the Indian market. There are so many on the rest of the world other than within the fishing and oil
other possibilities for exploring and exploiting the difference industry. Take a step in the direction of helping and improving
in resources and available problems. The entrepreneurship parts of the world where it is really needed. India is such a
exploration is not approached as much as it should be, based place in need.
on India being as entrepreneurship-friendly as it is.

AS MENTIONED, NORWAY IS NOT EXPLOITING ITS

RESOURCES FOR THE GREATER GOOD AS WELL AS IT
COULD. It is often hard to see the possibilities where others
only see problems and then take the next step to make a
change for the better. Jane Chen and her company Embrace
is a good example of how entrepreneurs abroad can have a
great impact on other communities, countries, economies
and lives. Annually there are 20 million premature babies
born of which 4 million die due to hypothermia and health

IB International Business India 63 |

 // A NOTE ON ENTERING
A FOREIGN COUNTRY

WHEN OPERATING OUTSIDE DOMESTIC BORDERS there investors by in ex. lowering tariffs on some particular goods
are a vast amount of factors and implications to consider. and services) effect the operating profit. It can be changes
In international business the investments that flow between in regulations and tariffs that put restrictions on foreign
nations can be divided into two categories, mainly portfolio organizations capital outflow from that country and back into
investment and foreign direct investment. The latter is the one their country of origin. Thus country risk is defined as the
of interest with regards to our perspective of doing business exposure to potential loss of operating income caused by
in India. This report will elaborate on the main differences changes in a country’s political and/or legal system.
in the Norwegian and Indian business society. The following
section will, however, give a brief overview of the key risks THE FORTH MAIN RISK IN INTERNATIONALIZATION IS
involved in international business in general. This is popularly THE FINANCIAL RISK, or what is by Cavusgil et al. called
called “The Four Risks in Internationalization” (Cavusgil et “Currency Risk”. This relates to unexpected changes in
al. 2008), see figure 1.1 below. It is meant to be a simple exchange rates and can potentially reduce realized earnings
check-list to managers and other in need of a refreshment of by a substantial amount.
the potential pitfalls connected to engaging in international The stated risks are important to take into consideration, and
business even though they often cannot be completely avoided, they
need to be managed. A way of managing, or at least choos-
CROSS-CULTURAL RISK relates to the risk of misunder- ing the amount of risk to undertake, is to select the appropri-
standings and misinterpretations that arises when there are ate foreign operation method. This is another prominent field
cultural differences. This is probably the most prominent within International Business literature, and one of the most
and obvious risks for Norwegian firms that desires to operate critical decisions a manager of an international firm needs to
in India. Cultural differences are often deeply embedded in make. The different operating methods, or modes, are:
the mind-set of workers, and play a big part when it comes
to work-style, values and communication. Cultural risk is 1) contractual modes which includes: franchising, licensing,
not just apparent when it comes to workers, but is just as management contracts, subcontracting, project operations
important to consider with regards to foreign customers and and alliances;
potential business partners.
2) exporting modes, where we separate indirect, and direct
COMMERCIAL RISK RELATES TO THE POTENTIAL LOSS A exporting, which is exporting trough an agent or distributor,
FIRM CAN EXPERIENCE BY POOR MANAGEMENT of their or through own sales subsidiaries, or;
international business strategies, and the tactical choices
made by managers. This can be the risk of a bad choice of 3) investment modes, and is often in literature recognized as
foreign business partner, poorly timed market entry, mispric- a foreign direct investment, which is when a firm holds the
ing, and marketing strategy flopping. These are risks that will minority share, 50 % share, majority share, or invests 100%
always be important to consider, even for firms restricted to in foreign subsidiary. There are several considerations to
domestic operations, but the consequences are typically on a making the right choice of entry mode. Not only the overall
much larger scale in international business. business strategy of the firm, but also all of the risks above
Country risk, or political risk, refers to the risks of the foreign need to be considered. If the government leads an unpredict-
government intervention that can negatively (or in some able political agenda, the firm should consider whether it is
cases positively where governments encouraging foreign wise to go “all in” and make a direct investment, or maybe

64 | IB International Business India

 BUSINESS IN INDIA

it is more secure to start off by exporting in order to get to

know the country little by little before making such a substan-
tial investment.

THIS NOTE ON ITS OWN IS VERY GENERAL, but we want

to highlight the importance of the potential pitfalls in interna-
tional business. The conclusion is that if managed properly,
internationalization can help the firm take full advantage of the
vast amount of opportunities in investing outside domestic
borders.

IB International Business India 65 |

66 | IB International Business India
// PART 3: BUSINESS SECTORS
IB International Business India 67 |
68 | IB International Business India
 BUSINESS SECTORS

// OIL AND GAS

THE INDIAN OIL AND GAS SECTOR is playing an important dition to this The Petroleum and Natural Gas board has been
role for the Indian economy. When having a continuous constituted as an independent regulator for the midstream
increase in the energy needs, the Indian society is depend- and downstream segments of the industry”. Originally India
ing on this sector to keep up with the pace of their growing was a country dominated by national players in the oil and
economy. During the last 10 years India has developed into gas sector. However, in 2009 Indian law opened up for more
one of the world’s most energy consuming nations. The con- international investments in the sector to address the gap be-
sumption rate has stabilized at approximately 5.9% the last tween demand and supply in India. This has been a success
10 years. This is a much higher rate compared to the global and has attracted big amounts of foreign direct investments
average of 2.8%. When facing further growth in the Indian from April 2000 to September 2011 (according to the data
population and forecasted rural upgrading the next decades, provided by Department of Industrial Policy and Promotion
we can only imagine the needs for energy getting higher. (DIPP). Looking at the sector today we can observe both do-
In 2011 India was the 5th largest refining country in the world mestic players like Reliance Industries, Gujarat Adani Energy
and represents 4% of the worlds refining capacity. They Limited and Essar Oil Limited and foreign companies like BP,
also produce and export a significant amount of petroleum Royal Dutch Shell and BG dominating the sector.
products themselves. During the period of 2010-2011, the
country exported in total 50 million tons of refined petroleum IN THE FUTURE WITH DEMAND INCREASING EVEN FUR-
products. THER there is a plan of introducing open acreage licensing
policy in the upstream market. This is expected to result in
INDIA IS AS FOR NOW THE 4TH LARGEST IMPORTER OF large investments and new opportunities for companies and
OIL AND GAS. There is a shortage of energy in the country. service providers in this market. As for Norwegian players
As mentioned in the section about the Indian infrastructure, this could mean great opportunities, maybe particularly to
there are places in India where lights are out every Thursday contribute with our know-how and technological equip-
due to the deficit of energy supply. When manufacturing ment. In the natural gas segment a big expected amount will
companies have to use diesel to keep their factories going, contribute to the development of new gas transmission and
the consumption rate rises in quick speed. Estimations have distribution pipelines and CGD networks.
been done and as per now it is anticipated that the consump-
tion will increase to closer to 4.01 million b/d by 2015.

THE HEAVY SPENDING OF OIL has forced the Indians to

think differently about their day to day use of energy and the
negative effect their consumption has on the environment.
For these reasons they can show to high development within
the gas sector. Their annual gas demand in 2011 was 166
million standard cubic meters and is estimated to be as much
as 320 standard cubic meters in 2015. This is contribut-
ing to the energy needs the country is facing. Seeing gas is
a cheaper fuel than petrol we have seen a trend of cars, espe-
cially taxis in the big cities, converted into CNG cars.
The MoPNG regulates the Indian Oil and gas sector. “In ad-

IB International Business India 69 |

 // LNG - LIQUIFIED NATURAL GAS

WHAT IS LNG? in India is inevitably vast. In order to develop and expand this
LNG is natural gas in its liquefied form. After extraction, the market in India, the ability to extract, trade and distribute the
gas is cooled to -276o Celsius at a platform or a floating natural gas is crucial. As of today, we find the infrastructural
production center. And then transported by ship or truck to challenges the main concern. Only some gas stations in
an onshore facility before it is transformed back to its original certain areas provide natural gas per January 2012, and the
form and sent through pipelines for usage. LNG consists of logistical and distributive systems are far from satisfying in
80-90 % methane and smaller amounts of ethane, propane, order to efficiently trade gas and exploit the demand in India.
heavier hydrocarbons and other minor substances. As in so many other aspects, the success of international
trade in this industry relies on Indian governmental regula-
WHY LNG? tions. The supply and the demand are in place, but Indian
First of all, LNG is the most efficient way to transport natural infrastructure remains to provide sufficient systems for
gas. By liquefying the gas, the volume is compressed to less distribution so that the supply will reach the demand in the
than 1/600 of the original volume and transportation costs market for natural gas.
are heavily reduced. Also, natural gas per se is a very clean
and valuable fuel. It is more environmentally friendly than oil. BACKGROUND
It can be used for businesses and households as well as for Consumption of natural gas in India was around 2.28 tcf
fueling vehicles, ranging from shipping vessels to tuk-tuks. in 2010, out of which domestic production contributed to
Considered the most desirable fuel of the 21st century, 1.85 tcf. The rest had been arranged through LNG imports.
natural gas is estimated to contribute around 26% of global According to IEA estimates, this demand will quadruple by
energy consumption by 2030. LNG is also very safe and 2035. With 38 tcf of proved gas reserves, massive E&D
clean, as a spill would not need any environmental clean up investment plans are undergoing to tap and expand the
on land or water. country’s oil and gas potential. But still in terms of long-term
energy security, the country needs to equip itself with some
LNG IN INDIA more options. LNG and pipeline imports provide this solu-
The use of LNG in India is definitely increasing. When asking tion. Discussions are ongoing for Trans-Afghanistan Pipeline
the taxi driver in Mumbai for the gas price, in fact referring and Iran-Pakistan-India gas pipeline, but due to political and
to petrol/gasoline, he answered in INR/kg and was referring security reasons no material decision has been made so far.
to the price of natural gas as the taxis run on both gas and However, LNG imports have no such embedded issues. With
petrol. In fact, the government has imposed regulations con- an easy access to the Middle Eastern markets, such as Qatar,
cerning a dual fueling system for taxis and tuk-tuks in some and the forecasted medium-term lower natural gas prices
parts of the country. In some areas it is even compulsory to because of abundant unconventional fossil resources in the
have this dual fuel system in your vehicle. You can easily get US. India is in a good position to diversify its supply base.
your car converted to accept gas (or CNG/propane) in addi-
tion to traditional petrol. The conversion cost is set off by the CURRENT DEVELOPMENT
long run savings you make by running your car on cheap gas Recently, state-run energy giant Gail India Ltd. signed a 20-
instead of petrol. year strategic LNG import deal with Houston-based Cheniere
Energy. The US firm will supply 3.5 million tons of LNG per
With rapid development in all aspects of society including the year from Cheniere Sabine Pass LNG terminal located in
economic growth and population growth, the need for energy Louisiana. Energy analysts estimated the deal to be worth at

70 | IB International Business India

 BUSINESS SECTORS

least $15 billion for the US supplier. The LNG deliveries into Petronet LNG Ltd. has constructed a 5 MMTPA capacity LNG
India are expected to start in 2017. terminal at Dahej in Gujarat. The terminal was commissioned
India has sought an additional 3-4 million tons LNG per year in February 2004 and commercial supplies commenced from
from Qatar, but the discussions were stuck in October 2011 March 2004. PLL has expanded this terminal to 10 MMTPA in
over pricing of the fuel. Petronet LNG Ltd., which at present 2009 to meet growing demand of LNG.
imports 7.5 million tons a year of LNG from Qatar under a Shell’s 2.5 MMTPA capacity LNG terminal at Hazira, Gujarat
long-term contract, sought an additional 2-3 million tons has also been commissioned.
while GAIL India wanted one million tons for 20-25 years. Dabhol LNG terminal (total 5 MMTPA capacity, with about 2.9
India’s ONGC is in negotiations with Russian Gazprom to MMTPA available for merchant sales) at Ratnagiri was also
jointly develop projects to produce LNG. Petronet LNG will expected to be completed by the end of 2011.
soon finalize the agreement for sourcing LNG from Russia Construction of Kochi terminal, with 5 MMTPA capacity, is
under the pact signed with Gazprom. The deal for supply of in full swing. The mechanical completion of the facility is
about 2.5 million tons of LNG per year was recently signed in expected in mid-2012.
Singapore. Port of Mundra, Kandia Port, Paradip and Tuticorin are also
some proposed projects.
VALUE CHAIN OF LNG Mangalore terminal still falls in the category of approved
Natural gas transforms into liquid. This is done for easy stor- projects after several delays.
age and transportation since it reduces the volume occupied
by gas by a factor of 600. LNG is transported in specially POTENTIAL FOR NORWEGIAN COMPANIES
built ships with cryogenic tanks. It is received at the LNG re- Several lucrative opportunities as well as challenges lie within
ceiving terminals and is re-gasified to be supplied as natural the value chain for Norwegian companies in the growing
gas to the consumers. LNG projects are highly capital inten- LNG sector of India. With vast experience in the maritime and
sive in nature. The whole process consists of five elements: petroleum industry, Norwegian companies are fully equipped
to capitalize their technological and other competencies that
1. Dedicated field development and production would be beneficial for India to secure its long term energy
2. Liquefaction plant needs.
3. Transportation in special vessels
4. Re-gasification plant Possible areas of co-operation include LNG regasification
5. Transportation and distribution to the consumer solutions, small scale LNG distribution, LNG as marine fuel,
LNG bunkering and ship to ship transfer, maritime technolo-
LNG supply contracts are generally of long term in nature gies and standardization activities. Norwegian companies
and the prices are linked to the international crude oil prices. could make use of their unique experiences to benefit Indian
However, the LNG importing countries has in recent times companies by supplying vessels and on-board equipment
started asking for medium/short term contracts with varying and steering joint development of advance maritime technolo-
linkages. gies. It could also provide advisory services to better manage
safety and environmental risks that come with the expansion
LNG RE-GASIFICATION FACILITIES STATUS IN INDIA: of the LNG sector in India.
EXISTING, PROPOSED, UNDER CONSTRUCTION AND AP-
PROVED

IB International Business India 71 |

 // SHIPPING

LIKE NORWAY, INDIA HAS BEEN BLESSED WITH A LONG in the maritime sector is the National Maritime Development
COASTLINE. Hence, the shipping industry is big. The mari- Programme (NMDP), launched by the Gol in 2005. Other
time transport accounts for 95% of the country’s total trade significant improvements conducted by the Gol are develop-
in volume, and about 70% in terms of total value. India is ments of inland container depots and container freight sta-
among top 20 in the world, and the leading of the develop- tions to ease the cargo distributions at Indian ports. Over 24
ing nations in terms of merchant shipping fleet. The Gross greenfield ports are expected to be commissioned between
Tonnage (GT) under the Indian flag was 10.1 million GT in 2016 and 2025. These projects will add a significant capacity
2010 with 1029 ships in operation. Globalization, increase in to the ports and facilitate the increase. These projects and
import of LNG, and the transformation from a protected en- enforcement of new laws reflects the optimism in the indus-
vironment in the cargo traffic are factors that could increase try and the great potential India has in this sector.
the positive development for the shipping industry in India.
WITH ITS LONG COASTLINE AND CHEAP LABOR the op-
THE 13 MAJOR PORTS OF INDIA accounted for approxi- portunities for foreign companies are escalating. The massive
mately 66% of the total cargo traffic, while there are about growth in LNG trade globally is also a great opportunity for
200 non-major ports that control the remaining traffic. The the Indian shipping industry. Currently, India only has two
ports act as an interface between coastal transport and land LNG terminals, but more are planned. The potential in this
transport. Since 2006 the cargo traffic at Indian ports has sector is huge, the emerging economies’ need for energy
had a steady increase despite times with recession. The is consistently growing, and because LNG is environmental
Government of India (Gol) manages the major ports, and the friendly and safe this is a great potential for the Indian ship-
state governments are in charge of the non-major ports. ping industry. The challenges, on the other hand, are the ex-
penses that follow. For one ship to carry LNG, it costs about
THE SHIPPING INDUSTRY IS REGULATED BY BOTH US $200 million. The Indian shipping companies therefore
INTERNATIONAL AND DOMESTIC LAWS. The International need to build up strategic tie-ups with their foreign counter-
Maritime Organization has a set of rules to ensure safety and parts to be able to take on this opportunity. Consequently,
secure efficiency worldwide. The most important acts that this should be of great interest for Norwegian companies.
regulate the domestic shipping industry are: The Merchant The tax burden in the shipping industry is another barrier
Shipping Act (1958), The Inland Vessel Act (1917), The for foreign companies considering India and one reason
Coasting Vessels Act (1838), and The Multi modal Transpor- that many of the Indian ship owners prefer to flag out their
tation of Goods Act (1993). Indirectly, legislations such as ships. The global practice change from profit-based taxes
The Indian Ports Act (1908), The Dock Workers Act (148) to tonnage taxes, were of great benefits for the ship owners.
and The Major Port Trusts Act (1964) are formulated to Even though, there are still too many regulations and different
regulate the industry. The wide regulatory framework in India taxes that need to be taken into account. The Research Paper
adds costs to the conformity of such set of laws and makes by the Ministry of Finance lists out several of these taxes.
stricter entry barriers for the industry. See “Regulations, The minimum alternate tax, dividend distribution tax, VAT
bureaucracy and law enforcement” for more information on on ships, sales tax, wealth taxes, and seafarers taxation on
how to overcome these barriers. employees are just a few examples of the many taxes that
need to be taken into consideration.
A RECENT DEVELOPMENT that has been conducted to
enhance private investments and improve the service quality

72 | IB International Business India

 BUSINESS SECTORS

OTHER IMPLICATIONS AND CHALLENGES for the Indian and the competition is getting tighter. Consequently, building
shipping industry are the decline in overseas trade. A decline network and make good relations to shipyards, owners and
of about 53% over the last 30 years is a major problem. partners become essential before entering India. The advan-
The reduction in overseas trade is due to high transporta- tages compared to Norway, are cheaper qualified labor and
tion costs, port delays and poor turnaround time of coastal being closer to the customers. India has a large labor force of
ships on account of over-aged vessels. The majority of the qualified engineers and the fact that English is widely known
Indian vessels are over 20 years of age, which reduces their makes the cooperation between the two cultures easier.
competiveness compared to foreign vessels. Heavy capital
investments are required to change this decline, and the infra-
structure needs to undergo large transformation. The Indian
shipping companies are striving to acquire changes and are
putting pressure on the government. Shipping analysts have
also concluded that there is an urgent need for the govern-
ment to improve their role as a facilitator, and to create op-
portunities for a better business climate that will attract new
investments in the shipping industry.

INNOVATIVE METHODS are needed to raise more resources,

and one finance model that would have suited the Indian
shipping industry is the Norwegian limited partnership
structure (KS model). This structured financing model is a
tax deferral method employed to finance ship acquisitions.
Such a model is not yet present in India, but much needed
according the Directorate General of Shipping, Government of
India. Accordingly, both the government and the Indian ship-
ping companies are contributing to develop and support the
growth in the industry. Despite the mentioned challenges and
obstacles, India still has the potential to become amongst the
leading shipping nations in the world. Consequently, to be
positioned in the market when the growth starts expanding is
a great advantage.

DURING OUR COMPANY VISIT TO KONGSBERG MARITIME

IN MUMBAI they emphasized some of the challenges they
find in the maritime industry in India. As mentioned earlier the
infrastructure is a huge obstacle and need to develop in order
for the shipping industry to grow. The piracy problem is also
a big challenge, and need to be focused on. Another trend
is that more small companies now are entering the market

IB International Business India 73 |

74 | IB International Business India
 BUSINESS SECTORS

// AQUACULTURE

AQUACULTURE IN INDIA HAS A LONG HISTORY. There standpoint on who is right and wrong.
are references to fish culture in Kautilya’s Arthashastra
(321–300 BC) and King Someswara’s Manasoltara (1127 OPPORTUNITIES FOR NORWEGIAN COMPANIES. The most
AD). The traditional practice of fish culture in small ponds in important thing from the perspective of Norwegian aqua-
eastern India is known to have existed for hundreds of years. culture companies is the simple fact that India has a huge
Significant advances were made in the state of West Bengal aquaculture industry which is growing at a steady pace. This
in the early nineteenth century with the controlled breeding creates some opportunities for Norwegian companies with
of carp in bundhs. Fish culture received notable attention in core business within the field. In particular, two areas are
Tamil Nadu (formerly the state of Madras) as early as 1911. considered of interest: Fish feed and general know-how.
Subsequently, states such as Bengal, Punjab, Uttar Pradesh, Optimal feeding of the fish is crucial to keep the costs as low
Baroda, Mysore and Hyderabad initiated fish culture through as possible. Since India is such a huge producer of farmed
the establishment of Fisheries Departments (FAO). fish, so is the market for fish feed. Norway holds some of
the most advanced fish feed producers in the world and they
INDIAN AQUACULTURE HAS DEMONSTRATED A SIX-AND- have extensive knowledge about designing optimal feeding
HALF-FOLD GROWTH over the last two decades, with fresh- schedules, obtained by many years of R&D. Even though the
water aquaculture contributing over 95 percent of the total species differ between Norway and India it should be pos-
aquaculture production. The production of carp in freshwater sible to take advantage of knowledge already acquired and
and shrimps in brackish water is the major areas of activity hence use it in the Indian market.
today (FAO). Furthermore, Norwegian know-how could be useful for
Indians. This applies to salt water fish farming in particular.
CONSIDERING THE SUBSTANTIAL CONTRIBUTION AQUA- This is due to the less developed sea farming in India as well
CULTURE MAKES TOWARDS SOCIO-ECONOMIC DEVELOP- as the Norwegian progress in the area the last decades. We
MENT In terms of income and employment through the use are not able, however, to recommend what a business model
of unutilized and underutilized resources in several regions should look like. But we feel confident that it exists market
of the country, environmentally friendly aquaculture has opportunities for Norwegian firms holding the know-how.
been accepted as a vehicle for rural development, food and This relies on an assumption that political and cultural bar-
nutritional security for the rural masses. It also has immense riers are feasible. Another issue any company considering
potential as a foreign exchange earner, which is important entering the Indian market should be aware of is the infra-
for India. Greater R&D support with strong linkages between structure. These issues are elaborated on in other parts of
research and development agencies, increased investment the report. Especially firms which can contribute with new
in fish and prawn hatcheries, establishment of aquaculture technology or exclusive know-how are in a good position to
estates, feed mills and ancillary industries have all been iden- succeed in such a complex country as India.
tified as important areas for maintaining the pace of growth
of the sector (FAO).

INDIA HAS A TOTAL PRODUCTION OF APPROXIMATELY

8 MILLION TONS OF SEAFOOD where 800 000 tons are
exported. More than half of the production is farmed fish and
shrimps. The latter are by far the most important species.
The export accounts for approximately $ 3 billion (CIFE/
Nielsen, 2012). The largest importers of Indian fish are US,
China and Japan. The Middle East is considered as a strong
upcoming market.

DURING OUR STAY IN MUMBAI, we had scheduled a day

at the Central Institute of Fisheries Education (CIFE). We
met different scientists and students. This gave us a deeper
understanding of the Indian aquaculture. The professors at
CIFE called for more venture capital in order to explore and
exploit more deepwater fishing. The professors thought that
the regulation of the industry has improved significantly over
the years and that it is at a sustainable level. This is non-
sense, according to Harald Nævdal (commercial counselor
at Innovation Norway in Delhi). We will cede from taking a

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 BUSINESS SECTORS

// IT

THE INDIAN IT/ IT ENABLED SERVICES (ITES) has played million people and indirect employment to many more.
a key role in putting India on the global map. Over the past Emerging trends in service delivery like Cloud Computing and
decade, the Indian IT-BPO sector has become the country’s Platform BPO are likely to remodel the industry by creating
premier growth engine, crossing significant milestones in new business opportunities for the IT/ITeS vendors and driv-
terms of revenue growth, employment generation and value ing changes in the traditional service offerings.
creation, in addition to becoming the global brand ambas-
sador for India. THE INDUSTRY is categorized into four broad segments:

THE INDIAN IT-BPO SECTOR, including the domestic and 1) IT services

export segments, continues to gain strength, experiencing 2) Software products and engineering services
high levels of activity both onshore as well as offshore. The 3) IT enabled services (ITeS – BPO)
companies continue to move up the value chain to offer 4) Hardware
higher end research and analytics services to their clients.
The Indian IT-BPO industry has grown by 6.1% in 2010, THE GROWTH IN IT/ITES SEGMENT FOR THE NEXT FIVE
and is expected to grow by 19% in 2011 as companies are YEARS is expected to be driven by a shift in the service mix
coming out of recession harness and they face the need for towards higher value services like business analytics, knowl-
information technology to create competitive advantage. edge process outsourcing (KPO) including legal services, etc.
India’s fundamental advantages – abundant talent and cost –
are sustainable over the long term. With a young demograph-
ic profile and over 3.5 million graduates and postgraduates
that are added annually to the talent base, no other country
offers a similar mix and scale of human resources.

REALIZING THE WEALTH OF POTENTIAL IN THE IT-ITES

SECTOR, the central and state governments are also working
towards creating a sound infrastructure for the IT-ITeS sec-
tor. CII aims to make the Indian IT and ITeS industry world
class by continuously providing a platform for understanding
and adoption of the new developments and best practices
worldwide in this sector. This includes taking up concerns
and issues of the Indian industry with the relevant ministries
at National and State level, coming up with studies, reports
and surveys to help understand the potential of Indian IT and
ITeS market and the issues faced.

AS ONE OF THE KEY GROWTH ENGINES OF THE ECONOMY,

the Indian IT/ITeS industry has been contributing notably
to the economic growth accounting for around 5.6% of the
country’s GDP and providing direct employment to about 2.3

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 // EPILOGUE
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80 | IB International Business India
 EPILOGUE

// EPILOGUE

INDIA OFFERS CONSIDERABLE OPPORTUNITIES BOTH

ON THE SUPPLY AND DEMAND SIDE. Cheap, skilled labor
and a vast and emerging consumer market - and an even
bigger potential market when more and more are lifted out
of poverty - make it attractive for Norwegian companies to
explore this gigantic democracy. The challenges and risks are
however many and decisive. India is a 1.2 billion democ-
racy, and the complexity of the society is almost beyond our
understanding. The contrasts and regional differences are so
substantial that India is often considered a continent rather
than a country.

WIDESPREAD CORRUPTION, A CONTEXTUAL WORLDVIEW,

A TOTALLY DIFFERENT MINDSET and culture, poor infra-
structure and a heavy and unpredictable bureaucracy are the
main challenges for Norwegian businesses. Corruption is a
result of the general mindset and philosophy and the tradition
of emphasis on respect, loyalty and tight networks and rela-
tionships. The infrastructure fails to keep up with the general
development of the country and severely slows down the
progress. The complex and chaotic bureaucracy is a result of
what some call “too much democracy” and decision making
processes are slow and inefficient. Some claim it is the price
you have to pay for a democracy of this proportion. The
unpredictability in the regulatory bodies also hinders foreign
investments. Entering India requires considerable financial
strength, local knowledge and masses of patience. A way to
increase your chance of success is to spend time ahead of
entry on establishing relationships and partnerships so that
you are well connected and have thorough local expertise
and knowledge when you choose to enter India.

NORWAY HAS A LOT OF KNOW-HOW AND RESOURCES

THAT ARE VALUABLE for a fast developing country like India.
Our expertise in the energy and maritime sectors is espe-
cially important and can benefit Indian as well as Norwegian
stakeholders. Healthy trade and interaction is possible and
the best case scenario is a win-win situation where we all ex-
ploit the competitive and comparative advantages that exist.
In pursuing this, the challenges mentioned above have to be
given appropriate attention. The obstacles are substantial, but
not impossible to overcome. Local knowledge and expertise,
solid networks, thorough research done in advance and
patience are the factors we believe are the keys to success in
incredible India. Good luck!

IB International Business India 81 |

 // THE IB INDIA TEAM

IN INDIA:

KRISTINA HAVN BRUNES INGRID HÅGÅRD BAKKE

CHIEF EXECUTIVE OFFICER / CHIEF EDITOR
SCHOOL COORDINATOR NHH MSc in Economics and Business
MSc in Economics and Business Administration, NHH
Administration, NHH Tel: +47 975 01 357
Tel: +47 920 92 688 [email protected]
[email protected]

ROBERT NYSTAD IDA FJELDSTAD

CHIEF ANALYST CHIEF OPERATIONAL OFFICER
MSc in Economics and Business MSc in Economics and Business
Administration, BI Oslo Administration, BI Oslo
Tel: +47 906 19 758 Tel: +47 991 54 245
[email protected] [email protected]

82 | IB International Business India

 EPILOGUE

SUPPORTING AUTHORS:

MAGNUS HASSELEID ANITA KAUR MONGIA

CHIEF FINANCIAL OFFICER NTNU school of entrepreneurship
MSc in Strategic Marketing Manage- Tel: +47 928 61 206
ment, BI Oslo [email protected]
Tel: +47 926 65 085
[email protected]

SUSANNE LUDVIGSEN KHURRAM RAO

MSc in Economics and Business MSc in Economics and Business
Administration, BI Oslo Administration, NHH
Tel: +47 402 17 092 Tel: +47 942 67 925
[email protected] [email protected]

IB International Business India 83 |

 // PREVIOUS IB PROJECTS

2010/2011: Indonesia

2009/2010: Mexico

2008/2009: Malaysia

2007/2008: Vietnam

2006/2007: Brazil

2005/2006: India

2004/2005: China

2003/2004: Russia

2002/2003: Turkey

2001/2002: Poland

2000/2001: South Korea

1999/2000: Brazil

1998/1999: The Baltic States

1997/1998: Indonesia

1996/1997: India

1995/1996: South Africa

1994/1995: Chile

1993/1994: Hungary

1992/1993: Mexico

1991/1992: Portugal

1990/1991: Russia and the Baltic States

1989/1990: Thailand

1988/1989: China

1987/1988: Italy

1986/1987: Australia

1985/1986: Brazil

1984/1985: Singapore

84 | IB International Business India

IB International Business India 85 |
 // SPONSORS

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MANAGEMENT
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Les mer på www.quartzco.com

86 | IB International Business India

 EPILOGUE

// REFERENCES
PART 1
Key Statistics
https://www.cia.gov/library/publications/the-world-factbook/geos/in.html
Innovasjon Norge: Presentation at Norwegian Risk Forum

Economy
http://articles.economictimes.indiatimes.com/2011-07-25/news/29812834_1_india-ranks-government-economic-power-economic-
growth
http://www.economywatch.com/economic-growth/india.html
http://www.forbes.com/2010/01/07/india-economy-inflation-entrepreneurs-wharton.html
http://www.mapsofindia.com/india-economy.html
http://www.rediff.com/business/slide-show/slide-show-1-indias-top-20-states-by-gdp/20110722.htm
http://www.squamble.com/2010/08/19/india-to-be-the-fastest-growing-economy-by-2015/
http://data.worldbank.org/data-catalog/world-development-indicators?cid=GPD_WDI
http://www.tradingeconomics.com/india/gdp-per-capita-ppp
Hudson, Ray. 2011. Geographica. Tandem Verlag GmbH, 6th revised edition.

History
http://www.indhistory.com/
http://en.wikipedia.org/wiki/History_of_India

Politics
http://en.wikipedia.org/wiki/Politics_of_India
http://adaniel.tripod.com/politics.htm
http://www.sscnet.ucla.edu/southasia/History/mainhist.html

Society
Innovasjon Norge, Republic of India Handbook, 2010
http://www.differencebetween.net/miscellaneous/difference-between-urban-and-rural-india/
http://countrystudies.us/india/82.htm
http://www.globalsecurity.org/military/world/india/society.htm

Culture
Grihault, Nicki (2008): Kulturnøkkel til India. Libretto Forlag, Oslo.
http://www.worldbusinessculture.com/Business-in-India.html

PART 2
Business culture
http://www.worldbusinessculture.com/Business-in-India.html
Innovation Norway, New Delhi (2012): They way we do it
http://en.wikipedia.org/wiki/Jugaad#Jugaad_as_a_concept
http://www.ledernytt.no/indiafeber.4871764-112541.html
http://www.doubletongued.org/index.php/dictionary/jugaad/

Infrastructure
http://www.businessweek.com/magazine/content/07_12/b4026001.html
http://www.etiskhandel.no/Artikler/5473.html
http://www.youtube.com/watch?v=WGK5w_2g8Ec&feature=relmfu
http://www.youtube.com/watch?v=KF3S1ZLZlgE
http://www.businessweek.com/magazine/content/07_12/b4026001.htm
Ernst & Young 2011: Doing Business in India

Regulations, bureaucracy and law enforcement

http://www.bbc.co.uk/history/british/empire_seapower/east_india_01.shtml
http://www.hindustantimes.com/business-news/WorldEconomy/India-crawls-up-in-red-tape-order/Article1-759660.aspx
http://www.doingbusiness.org/rankings
http://www.doingbusiness.org/Rankings/india/
Uninor, meeting of Jan 19th 2012

Corporate Social Responsibility

http://www.sdchronos.org/ImmChronos/english/corporate_social_responsibilty.html (definitin)
5th Global CEO Survey, PriceWaterhouseCoopers/ World Economic Forum (1,161
CEOs across 33 countries), 2002
MORI/CSR Europe, 2000

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 EPILOGUE

”Corporate Social Responsibility” hilts in the media from 1989-2009 www.corporateregister.com

Caroline D Ditlev-Simonsen Handelshøyskolen BI – lecture notes

Corruption
Breaking Free of Nehru: Let’s Unleash India! Sanjeev Sabhlok, 2009
Innovation Norway handbook
CPI 2011, www.transparency.com
NRF conference
Kongsberg Maritime meetings
How to attract and keep talent
The Nielsen Company: Presentation
Ernst & Young 2011: Doing Business in India
The Indian Consumer Market
The Nielsen Company: Presentation
Ernst & Young 2011: Doing Business in India

Entrepreneurship in India
http://images.businessweek.com/ss/09/03/0312_innovative_countries/14.htm
http://www.theatlanticcities.com/technology/2011/10/worlds-leading-nations-innovation-and-technology/224/
http://designthatmatters.org/news/dtm-blog/2008/09/two_incubator_s.php
http://www.ted.com/talks/jane_chen_a_warm_embrace_that_saves_lives.html

A note on entering a foreign country

“Foreign Opreation Merhods”, Lawrence S. Welch, Gabriel R.G. Benito, Bent Petersen, 2007. Edward Eldar Publishing Limited.
“International Business”, S. Tamer Cavusgil, Gary Knight, John R. Riensenberger, 2008 Pearson Education Inc.

PART 3
Oil and gas
Ernst & Young/BP Statistical Review 2011
http://www.ibef.org/industry/oilandgas.aspx

LNG
Sanjiv Wagh, Kongsberg
http://www.eia.gov/countries/country-data.cfm?fips=IN
Are We Entering A Golden Age Of Gas? Special Report, IEA, October 2011
http://www.ogj.com/articles/2011/12/gail-india-signs-20-year-sabine-pass-lng-deal-with-cheniere.html
http://www.business-standard.com/india/news/india-qatar-disagreepricinglng/453944/
http://www.reuters.com/article/2011/12/07/petronet-gazprom-idUSL3E7N74YF20111207
http://petroleum.nic.in/ng.htm
http://www.energy.ca.gov/lng/worldwide/maps/Asia_Pacific_Map-B.pdf
http://www.lngfacts.org/
http://www.commodityonline.com/commodities/energy/naturalgas.php
http://www.norway.cn/Global/SiteFolders/webbeij/DNV%20-%20China%20LNG%20Final%20Report.pdf

Shipping
Suresh Vaswaney, Managing Director, APS Maritime Services, and Andheri West, Mumbai October 21, 2009 http://www.shippingbiz360.
com/article/8/20091021200910211858496404b7ea431/Challenges-and-opportunities-for-India%E2%80%99s-shipping-industry.html
www.eximbankindia.com/op/op142.pdf
Ernst & Young 2011: Doing business in India
Sanjiv Wagh, Kongsberg Maritime

Aquaculture
http://www.fao.org/fishery/countrysector/naso_india/en
Nielsen: Power Point Presentation and meetings
CIFE: Meetings

IT
http://www.pwc.com/en_IN/in/assets/pdfs/publications-2011/Indian_IT-ITeS_Industry_-_Changing_Landscape_and_emerging_trends.pdf

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INTERNATIONAL BUSINESS INDIA 2012
www.ib.no
[email protected]

AUTHORS
Kristina Brunes, Robert Nystad, Ida Fjeldstad, Magnus
Hasseleid, Khurram Rao, Susanne Ludvigsen, Anita
Kaur Mongia & Ingrid Hågård Bakke.

EDITOR
Ingrid Hågård Bakke

PHOTOS
Ingrid Hågård Bakke

LAY-OUT AND DESIGN

Lars Bakke, Architect MNAL/MAA, www.larsbakke.com

PRINT
Lundblad Media AS
www.lundblad.no
[email protected]

90 | IB International Business India

IB International Business India 91 |
This report is produced by students from the following schools:

International Business Project