India is a land of opportunity for Western Australian businesses, particularly in resources and the expanding knowledge industry, according to Australian high commissioner to India.
India is a land of opportunity for Western Australian businesses, particularly in resources and the expanding knowledge industry, according to Australian high commissioner to India.
John McCarthy AO, who spoke this week at the WA Business News Meet the Ambassadors lunch, said despite an 8 per cent annual growth rate presenting significant opportunities, it was important for Australian business to be aware of economic, political and social issues when trading with India.
“It’s about where you find your niche, where you find your place,” Mr McCarthy told the audience.
“Almost any area has an advantage. There are some areas where the lid hasn’t come off sufficiently yet, such as retail and banking. In mining there is a lot of work to be done, too.”
India is Australia’s 12th largest merchandise trading partner and two-way trade in goods totalled $8.2 billion in 2005.
Merchandise trade dominates the relationship between Australia and India with merchandise exports to India reaching $7 billion in 2005, representing 5 per cent of Australia’s total merchandise exports.
“They want our coal and they want our gold. They would like our LNG and, at the end of the day, they would like our uranium,” Mr McCarthy said.
He said India relied heavily on energy imports, which ultimately could benefit Australia’s LNG exporters.
“It needs LNG or natural gas and that’s something which it is looking increasingly at Australia to try and do,” he said.
Mr McCarthy said the knowledge industry also presented a number of opportunities for Australian business.
“A lot more is being done in education generally; there are now close to 30,000 Indians studying in Australia,” he said.
“There are now more Indians studying in Australia than in the UK, if measured in terms of months of study.
“This needs to be matched by a lot more scientific interchange and there are opportunities for this to happen.”
Mr McCarthy said the $20 million package over five years for science and technology research between Australia and India was a positive step forward in this regard.
According to Invest Australia, Indian investment in Australia is worth around $1 billion.
“[Indian companies] invest very heavily; they have 26 sizeable companies that have invested in the IT industry in Australia,” Mr McCarthy said.
“I would like to see more Australian investment in India.”
Despite India’s healthy growth rate and stable democracy, however, he said there were problems to be overcome, including a high poverty rate, HIV/Aids and a failing bureaucracy; all factors Australian business looking to break into the market needed to be aware of.
