Doing business with India—getting it right
India is home to 1.3 billion people, the second most populous country in the world after China and set to take the number one spot by 2035.
Twenty-two languages are recognised in the Indian constitution. Hindi (in Devanagari script) and English are the official languages used by the Indian Government. Some estimates say the country is home to 461 languages in total.
The Australian Government says no market has bigger potential for Australian businesses over the next 20 years. By 2025, one-fifth of the world’s working age population will be Indian.
Indians in Australia also make up a sizeable market. The Indian diaspora has reached 700,000+ people and is the fastest growing in the country. Indians represent the highest number of skilled migrants in Australian as well as a significant percentage of temporary skilled visa holders and our second largest source of international students.
The Australian and State Governments are working hard to facilitate Australian enterprises engaging with India.
Lexigo: What is the most common mistake Australian organisations make when doing business with Indians?
Mr Engineer: The most important thing is the concept of time and how we focus our attention when doing deals. Australian organisations tend to have an extremely transactional approach. They go to a meeting with an agenda, set objectives, eager to get the deal done. To gain an Australian organisation’s trust, you must do the work and meet deadlines first. To Indian organisations, the relationship element is critical. Trust is built around connections. In this way, the two countries are at opposite extremes of the spectrum.
This also impacts the time it takes from when an idea is conceived to realisation. Sometimes, it can take close six years to set up an organisation in an overseas market. A lot of Australian organisations are not prepared for that duration. They expect things to happen within six to 12 months to consider it value for money. Three-year horizon planning and investing time is required.
You must understand doing business with India takes time. Don’t expect to come away from a few days’ trip to India with a signed contract; you might not even get it after a few months. It’s all relative; a few hours with each provider on a three-day trip or one phone call will not be enough. You need to schedule regular calls or meetings to build an on-going relationship. Leverage technology if it’s not possible to meet people in person.
Hierarchy is also very important when working with Indian organisations. We must understand it’s there and work with it. If you disregard it, it will impact your relationship. A short-term win will be outweighed by long-term damage to the relationship. It’s going to exist for at least the next 20 years so we must build systems that work with it.
TIP #1: Don’t make your conversations all about work. Indians like to talk about personal and family life. While in Australia it might be considered intrusive, in India it’s a way to show you’re interested in the person. Family is a big part of Indian life.
Also think about what is appropriate. For example, cows are sacred in India so leather goods would not be an appropriate gift. Also, your Indian counterparts might be vegetarian or have a halal diet, so avoid an awkward situation by noting this on their place card at formal dinners.
Lexigo: How can Australian organisations work better with their Indian counterparts?
Mr Engineer: To realise your return on investment, you must drill down to the elements behind what drives your target overseas market or partners to do certain things. For example, if your Indian team is saying ‘yes’, they could be acknowledging what you’ve said, not necessarily agreeing with you.
At the moment, India has been rebranding itself from a technology perspective, and Australian organisations need to get cost-competitive. They’re looking at activities they can do with overseas counterparts, not just for the sake of costs, but to leverage talent and free up people here to work on other areas of the business that generate value. The overseas work model also allows scalability as required, which is more difficult in Australia.
TIP #2: Each state in India has its own market and must be treated accordingly. Similarly, each province and city in China is different. When considering entering a new market, it’s important to assess which market (and submarket), whether it be in India, China or elsewhere, is best suited for your product or service. How many competitors already exist in your target market?
Lexigo: For organisations selling a product or service to Indian clients, what are the best communication channels to use?
Mr Engineer: It comes down to the product and demographic – does it need to be seen for people to understand the value? Value for money and value for many are important concepts when it comes to India. Companies assume they can access the entire population of India, but they fail to account for the market share held by their competitors. India is a cost-sensitive market and people might be tempted by cheaper products. If your product is more expensive, perhaps the total cost over a period of time is better.
Mobile phones are really big at the moment in India. An enormous portion of the population is accessing information online. As more Indians get online, it becomes a better marketing channel. What’s interesting is they’re getting online with mobile devices, not through traditional ways such as getting an internet connection at home*. Think about marketing fit for mobile devices. It’s been a power shift over the last three to 10 years.
*India’s 300 million Smartphone users will reportedly grow by more than 50% in the next few years.
TIP #3: Indians are emotionally expressive. There’s a lot of hand gestures and nodding. An Indian might perceive an Australian as uninterested because of their (lack of) body language. It’s not wrong, but we need to be aware of how we might be perceived.
Lexigo: How can translation be used effectively to support business relationships with Indians?
Mr Engineer: When it comes to marketing, the way India is geographically distributed, it always makes sense to have materials in local languages. It also depends on your target demographic. If you were looking to appeal to a particular segment of the market, you would look at the other options besides English. As the saying goes, “Act local, think global”. Translation adds that element.
Many Indians speak English and it is one of the official languages, however in rural areas many people will only speak the local language. If you’re visiting, a local interpreter would be very useful.
According to CNN Business, there are already 234 million local language internet users in India and this is set to grow to 536 million by 2021.
TIP #4: When visiting India or meeting Indian counterparts in Australia, business attire is appropriate for meetings. For an event such as a cultural dinner, it might be appropriate to wear a traditional dhoti for men or for women a salwar kameez or sari (make sure you ask an Indian woman how to wear it properly, don’t rely on a YouTube video). Even a small traditional element such as a bindi would be good, or the usual formal dress of your own country. Take your cue from Indian Prime Minister Narendra Modi, not Canadian Prime Minister Justin Trudeau, whose elaborate outfits were criticised during his visit to India in 2018.
Lexigo: What does Australia have to offer India?
Mr Engineer: Regarding education, Australia is not the only place Indians look. Often they prioritise the United States, Canada or the United Kingdom. It comes back to the long-term return on investment. Visa laws play a big role in those decisions. We’ve got competition, New Zealand offers great education and visa work rights and post-study work options.
A lot of work is also happening in Australia around smart cities. The Indian Government has developed a smart cities plan, but they’re in their infancy. Australia can share the lessons learnt, especially for internationally recognised cities such as Melbourne and Adelaide.
In the medical area, there are a lot of opportunities for collaboration. Indian is doing great things in the field of frugal innovation. For example, an Indian research team met the challenge of developing a low-cost heart rate monitor that could be used in remote areas without electricity. It goes back to the Indian concept of jugaad, which is the ability to find an innovative solution with limited resources. Now the heart rate monitor is mass produced.
So there are a lot of opportunities for Australia and India to learn from each other!
Asialink Business Country Starter Packs: https://asialinkbusiness.com.au/country-starter-packs/P9
Government of India’s Smart Cities Mission: http://smartcities.gov.in/content/
Australian Government’s 20-year India economic strategy: https://dfat.gov.au/geo/india/ies/index.html
Victorian Government’s India strategy: https://www.dpc.vic.gov.au/index.php/news-publications/victorias-india-strategy
Languages of India: https://www.mapsofindia.com/culture/indian-languages.html
Shiraz Engineer is the Associate Director, Strategy and Capability at Asialink Business. Hailing from Mumbai, he has over 15 years of industry and consulting experience assisting clients with their complex business problems, operational issues, process and performance improvement, and business transformations. Shiraz has worked extensively in Asia with a number of multinational (banking and technology) and private companies. Shiraz has worked in the consulting industry for over six years including as a Manager in KPMG’s Enterprise consulting business, supporting local organisations in developing their growth strategy. He has also implemented a number of business transformation programs within the public and private sectors. Shiraz also has local experience working within Victorian Government as part of his project based roles with the Department of Sustainability and Environment and Department of Primary Industries between 2009 and 2012. Together with Asialink Business, Shiraz designs and delivers capability development programs to help organisations develop their cultural intelligence (CQ), in order understand, enter into and sustain operations in culturally diverse situations. Shiraz also provides practical market and industry focused resources to assist Australian businesses to enter into the Asian market. Shiraz has a Master of Business Administration and a Master of Commerce degree from Deakin University.
Written by Sophia Dickinson, Lexigo: Sophia Dickinson has 10 years’ experience in public service for both federal and state governments. She has also taught English in France and spent a year working at a local NGO in Yogyakarta, Indonesia. She is passionate about writing, intercultural communication and languages (she speaks French, Indonesian and is learning Spanish). Read more about her experiences at sophiadickinson.com.au