Wednesday, November 22, 2017

Trade Zone

Swedish companies have a positive view of future business opportunities in India

With one new Swedish company every month there has never been a dull moment for her ever since she landed in India in the latter half of 2012 to take over the mantle of Consul General for the Swedish government in Mumbai. The graduate from Uppsala University has previously served at the Permanent Mission of Sweden to the United Nations in New York; at the Swedish Embassy in Seoul, South Korea; and at the International Trade Policy Department and the Security Policy Department of the Ministry for Foreign Affairs. Apart from expanding the scope of engagement between the two countries in business and several areas of development activity  – her consulate’s jurisdiction includes Gujarat, Maharashtra and Goa – it also means building on the overall relationship between Stockholm and New Delhi. It’s as much a tribute to her diplomacy as to her Nordic cool that she has managed the challenging assignment in India’s commercial capital with great finesse. FREDRIKA ORNBRANT, CONSUL GENERAL OF SWEDEN in Mumbai took on queries from SHRIKANT RAO on the existing trade relations between Sweden and India and prospects of constructive cooperation between the two countries.

 

Give us an understanding of the contours of the current trade relations between India and Sweden?

Balance of trade between Sweden-India in 2013 was $0.72 billion. Exports of goods from Sweden to India $1.42 billion and import of goods to Sweden from India stood at $0.7 billion. India is Sweden’s 20th most important export market and 29th most important import market.  India we believe is definitely a growing market, in fact manufactured and semi manufactured goods make up for almost 89 per cent of the total exports of goods from Sweden to India.

 

Briefly tell us about Business Sweden’s role as a business and trade facilitator and the main initiatives it has taken recently in building Indo-Swedish relationship?

Figures can be interpreted in different ways. But trade over time has increased. The beauty of trade between India and Sweden is that Swedish companies go to India with a long-term perspective. One new Swedish company comes to India every month. And if you look at the figures from 2005 to today, the number of Swedish companies in India has doubled. Today, over 135 Swedish companies are in India.  Business Sweden has undertaken a number of initiatives this year to increase trade between Sweden and India. For example, they have organised a number of business delegations to India for Swedish companies within transport, security and ICT. Business Sweden and Embassy of Sweden also organised a delegation with senior officials from Karnataka to Sweden to discuss collaboration opportunities within transportation, waste to energy and retail. Furthermore, Business Sweden regularly organises seminars in Sweden to inform Swedish companies about opportunities in India within various sectors.

 

Tell us of the recent delegational visits from – and to – Sweden that have taken place in the context of building of ties between Indian and Swedish firms?  What are the current areas of interest and engagement?

The Consulate General of Sweden always makes a constant effort to engage delegates of the two countries in various knowledge sharing programs. A high level Swedish Transport Delegation, led by Jonas Hafström, Ambassador and Senior Advisor to the Swedish Minister for Trade, visited Ahmedabad on 23rd September 2014, to share best practices in the fields of transportation and urbanisation from Sweden with key representatives of the Gujarat government. Rapid economic growth, increased population and accelerating urbanisation have led to higher requirements on infrastructure facilities, including transportation all over the world. The city of Ahmedabad is just one of many cities that has been rapidly developing and is actively taking on these challenges. Sweden has experiences in this field, and can offer a plethora of cutting-edge, new and innovative solutions. One such offering is SymbioCities, where the goal is to create liveable cities that are mindful to our planet, and where people can live without being concerned about congested traffic, pollution or waste handling. Key here is to plan the cities well in advance with all relevant stakeholders, municipalities, private and public companies and the people that will be future residents. One needs to plan for bus transportation, waste handling, schools etc. at an early stage because it is time consuming and costly to adjust the city after it has been constructed. A business delegation on civil security visited Mumbai and Ahmedabad in April this year. Sweden has been at the forefront of cutting edge tech¬nology in civil security with significant advancements to address the growing challenges of the threats we face today. Sweden has a history of strong relations with India and there is a large potential for both the coun¬tries to share best practices and collaborate to create safety solutions that suit India’s specific needs.  On the innovations front, The Swedish Energy Agency and Business Sweden have developed the “India Sweden Innovations’ Accelerator. The main objective of the project is to facilitate transfer of innovative clean technologies and solutions from Sweden to India. As part of the Innovations’ Accelerator the Confederation of Indian Industry with Business Sweden, conducted a one day workshop on innovative clean technologies and business to business meetings between the Swedish delegation and Indian counterparts in April in Mumbai at Prin. L. N. Welingkar Institute of Management Development & Research (Weschool).

 

Which are the important Swedish companies that already have a presence in India and have established themselves as key players in the country’s development landscape?  Can you talk of new business opportunities they would be seeking?

At present, there are over 135 Swedish JVs or wholly owned subsidiaries in India. Swedish companies like SKF, Atlas Copco, Volvo and ABB are established entities that are steadily expanding their footprint in India, but there are also smaller companies like Bombay Works that has found India an interesting and expanding market. We have noted an increased interest about India in Sweden and we are hopeful that trade between our companies will expand further. And for Sweden, over 40 major or small Indian IT companies have their representative offices in the country. Also, joint research has been emerging as an area with great potential for bilateral collaboration, particularly in the green technology section.

 

Tell us about the Lifesciences and Healthcare platform you recently launched? Which are the Swedish firms which are actors in this and what are the best practices they are bringing to India?

With the objective to continue collaborations in the healthcare sector in a stronger and more sustainable way; the platform will serve as a key interface between the various stakeholders in the Swedish and Indian healthcare system. The platform will provide exceptional opportunities in the areas of research, policy, innovations and implementing best practises by both the countries. The aim is to enable for both countries to learn from each other. This platform will further strengthen the existing Memorandum of Understanding in the field of Healthcare and Public Health between Sweden and India signed in 2009. Swedish healthcare companies like Bactiguard, Hemocue and Mölnlycke Health Care are a few that are striving to bring in the best practices to the country

 

Which are the new Swedish firms which would be looking to be involved in tie ups for various construction sector projects in India or are looking to invest here in specific projects? Give us a sense of the areas of construction and infrastructure in which Swedish experts can offer India help?

This depends on whether you are looking at it from a government or business perspective. From a government perspective, Sweden and India have formed several MoUs for example in the areas of science and technology, health and energy. They can be used as a basis for further collaboration between both countries. Also, discussions are on in areas of mutual interests including urban development.  Seen from a business perspective, there are many opportunities within the field of infrastructure. In general, Swedes are good at system integration, like integrated traffic control systems, airport systems and port lighting, but there are many other opportunities as well. For example, traffic safety from a system perspective and buses that run on renewable energy and waste management and water treatment.

 

Managing waste for sustainable urban growth is an area in which Sweden can offer expertise? What kind of a movement is taking place in that zone?

Since 2009 India and Sweden have been working together in the area of Waste to Energy (WtE). The objective of the cooperation is to share visions and ideas on how WtE solutions could be concretely implemented, and increase partnerships for further developing sustainable energy systems. Urban waste poses major environmental hazards in India due to lack of technical expertise, regulatory setup and adequate funds within urban local bodies to develop an efficient waste management strategy. Biogas production and utilisation as a renewable energy source has immense potential for growth in India, especially in view of its overall environmental benefits of reduction in waste, greenhouse gas emissions and environmental pollution. This however, depends on the availability of appropriate technologies and expertise for setting up commercially viable biogas plants. Swedish companies are currently in a position to fill this knowledge gap and develop business opportunities while contributing to environmental solutions in India. Sweden being internationally recognised as a global leader in recovering energy from waste as well as recovering surplus energy from different industrial operations has the ability to transfer technical knowledge and develop self-sustaining relationships with India for joint long term benefits.

 

India is planning the dedicated freight corridors, the industrial corridors and the smart cities? Tell us about the specific opportunities - science and technology, intelligent transportation systems, telecommunications, climate technologies etc – Swedish companies would be seeking in these zones?

Sweden and India have signed Memorandums of Understanding on Science and Technology and on Health. They form a good basis for collaboration for example in the areas of medical equipment and pharmaceutical products, health and medical research and R&D. Looking at it from a hands-on perspective, Business Sweden has an important role to connect our nations’ companies. Their experts know what kind of collaboration the Swedish companies are looking for and can match-make accordingly, in Sweden or in India. In terms of the other mentioned areas, we would obviously like to see Indian and Swedish businesses in these fields to grow, and establish partnerships. It is not only good from an environmental perspective, but also from an economic one. The Consulate General will function as a bridge between our two countries, as well as an awareness-raiser in both directions.

 

India is witnessing significant developments – and has ambitions - in the airports, metro rail and railways space. What s the expertise Sweden can offer India in these areas?

Sweden and India have collaborated to promote Environmentally Sustainable Transport (EST) which will lead to establish a safe, reliable, affordable, efficient, people-centric and environment friendly transport system. In fact, we just concluded a workshop on sustainable transport ‘The way to sustainable transport: an Indo-Swedish perspective’. Our aim is to identify areas within transport and urban planning with potential for further collaboration between the two countries. Calling for best practices and planning for transforming Indian cities and towns safe for all. We will look to foster economical, social and environmental developments. In terms of metro, Swedish companies like Gunnebo and Bombardier operate in the Metro space. Bombardier has already worked in the Delhi Metro project. Gunnebo under entrance control offers specialised access control solutions for mass transit, BRTS, Metro, airport, public and commercial buildings.

 

Skill development is one area in which India faces a deficit. Tell us what Sweden can offer India?

Skill development is based on collaboration, convergence and coordination. Vocational training is a strategic component for economic growth in the future. It holds the key to create employable workforce which will be armed with knowledge, creativity, entrepreneurship and innovative ideas. Sweden along with India intends to achieve this goal by framing policies, setting up training centres and collaborating with the Government and industry. There is tremendous potential for cooperation in training for upgrading Indian skills over a broad range of sectors - construction, mining, water, energy, environmental technology, urban development, etc.

 

Tell us about the important landmark infrastructure and construction projects in Sweden from which India can derive learnings?

In my view the most important landmark in terms of infrastructure and construction would be SymbioCity. SymbioCity is the trademarked term for Sweden's approach to sustainable urban development. Established in 2008, the program's primary goal is to export Sweden's knowledge and experience with sustainable cities. SymbioCity aims to "get more for less", creating synergy by integrating different technologies and city functions. For example, waste can turn into energy, waste water can turn into fuel, and the excessive heat from an industry can warm up a household. According to the SymbioCity approach, environmental and economic gains result from unlocking synergies between urban systems. The seven building blocks of SymbioCity are: Architecture; Energy; Landscape Planning; Traffic & Transport; Waste Management; Urban Functions, Industry and Buildings; Water Supply and Sanitation. Several hundred Swedish consultants, contractors and system suppliers are connected to SymbioCity. SymbioCity is scalable, and adaptable to any climate. An approach that is open – and beneficial – to all.  To mention a few other examples of Swedish achievement from which India can derive learnings I can cite the case of Western Harbour, Malmö, a once decaying industrial area which has transformed into an exciting, sustainable urban environment with a bright future. Sustainability inspired the architects behind this eco-city within a city. The Western Harbour now has its own energy supply and waste treatment system, very few cars – and plenty of satisfied residents. We also have the case of the city of Linköping in southern Sweden which uses food waste from canteens and restaurants to produce biogas. Waste volumes have fallen, the town’s buses have better access to fossil-free fuel and local farmers use the residues left over as fertiliser. Then I can mention the making of an entire sustainable urban district around the lake of Hammarby Sjö in Stockholm. A run-down port and industrial area has been cleaned up, developed and converted into a modern and eco-friendly district. Hammarby Sjöstad is Stockholm’s largest urban development project with its own environmental programme incorporating energy supply, water and wastewater treatment and waste management. One can also make mention of Kungsbrohuset which is a building in Stockholm heated by people. A number of unconventional methods help to minimize energy consumption in the Kungsbrohuset Building in Stockholm. Like recovering excess body heat produced by the some 200 000 commuters that pass by the Central Station every day. Or that the building’s windows let the daylight in, but blocks out the summer heat. There are also future landmark projects that one can point out. Like the Stockholm Bypass Project which is one of Sweden’s largest infrastructure projects, linking the northern and southern parts of the region, resulting in a new route for the European highway (E4) past Stockholm. The aim is to take of the pressure off the so-called Essingeleden route, which is currently the only major road through and past Stockholm and the city centre. One of the longest road tunnels in the world - Over 18 of the 21 kilometres of road goes through a tunnel so as to reduce the impact on the sensitive natural and cultural environments.

 

Not much is known of the engagement of Indian firms in Swedish projects. What can India offer your country?  

India and Sweden have lasting faith in relationship where common shared values is the bedrock with respect for liberty and diversity Indian investment in Sweden is also growing. In order for a relationship to be sustainable it has to work two-ways and investments have to flow in both directions. Currently, 40 major/small Indian IT companies have their representative offices in Sweden and their cumulative exports are estimated at $600 million. Indian pharma and biotech companies like Dr. Reddys, Biocon, Kemwell and Ranbaxy are also present in Sweden. Bharat Forge, acquired the Swedish firm Imatra Kjilsta AB in 2005 with a workforce of over 500 employees. In 2006, Wipro acquired 100 per cent  equity of the Sweden-based Hydrauto Group AB which produces hydraulic cylinders for a consideration of $31 million. In April, 2011 Aditya Birla Group acquired the Swedish speciality pulp maker and bio refinery company Domsjo Fabriker for SEK 2.1 billion, so far the biggest Indian investment in Sweden so far. In May, 2011 India's Crompton Greaves signed an agreement to buy Emotron which develops electric motors in Helsingborg for a value of SEK 550 million. Recently in July 2012, an Indian telecom company - Altruist Technologies has purchased (acquired) the Swedish telecom company, Teligent. Altruist, the mobile Value Added Service (VAS) provider will now gain access to markets in Europe, North Africa and US following the acquisition. Teligent also currently provides mobile VAS services including voicemail and messaging. In the business community in Sweden, it is estimated that cumulative Indian investment in Sweden is in the range of $500-600 million.  Growing collaboration in innovation through joint Research & Development and institutional linkages is also on the way.

 

Will you briefly touch upon the main challenges for Swedish companies operating out of India? What are the irritants in the engagements between Swedish and Indian companies and what does Stockholm expect out of New Delhi?
The Swedish Chamber of Commerce in India (SCCI) conducted a survey in September 2013 to understand the business confidence of Swedish companies in India and ways of identifying obstacles and how they can be overcome. Seventy per cent of the respondents, or seven out of 10 companies, agreed that bureaucracy was problematic for their operations and growth.  The survey results add that 17 per cent of the respondents felt that a major part of their senior management’s time was spent on dealing with Government authorities about applications relating to the law and regulations.  Besides 28 per cent of the respondents listed bureaucracy to be the biggest risk facing their business here. Despite some short-term challenges from the current economic slowdown, Swedish companies have a positive view of future business opportunities.  The study finds that 8 out of 10 will increase their operations within the three upcoming years and nearly one out of two companies will increase investments with 10 per cent or more compared with last year-indicating Swedish companies’ long-term dedication and belief in the Indian market. The number of Swedish companies present in the Indian market has increased by an estimated 85 per cent since 2007.

 

What is your outlook for India?

Regardless of today's crisis, a strong increase in the number of foreign direct investment (FDI) projects in India is a clear indication that global investors view this country as an attractive investment destination. India has high potential of the domestic market driven by an emerging middle class, cost competitiveness and a mammoth pool of talent continue to make India one of the most preferred destinations for doing business. The country’s domestic demand-driven growth model is playing a catalyst role in attracting foreign investments in the country.




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