With a population of over 1.2 billion, India is home to one of the world’s largest populations as well as being one of the world’s fastest-growing economies. Until recently, the Indian economy saw heavy state intervention and regulation – however, over the last two decades, the economy has moved closer to a free market system.
One of the most prolific organisations in the UK to champion stronger trade links with India is the UK-India Business Council (UKIBC). Its chief executive officer, Richard Heald, comments: "Entering new markets is never an easy proposition and is often perceived as being the preserve of big companies. There are many challenges for UK businesses, especially SMEs, in deciding whether to enter any overseas market - let alone one as complex as India. India is a dynamic market with headline GDP of almost 9 per cent, a population of 1.2 billion, an increasingly young and dynamic workforce and a domestic economy which occupies some 87 percent of overall activity.
"It has developed financial, professional, legal and corporate services sector which, while should be liberalised further, has sustained and nurtured an impressive economic development to date. It is a vibrant, multi-cultural society and is famously the world’s largest democracy. It is widely accepted that India will evolve into the world’s second largest economy by the year 2050."
He continued: "Given its size, however, India should not be seen as one market but a series of interconnected regional markets where the legislative and investment climate may change from one state to another. The operating environment in Gujarat is famously different from that of West Bengal. Equally, Noida, Gurgaon, and New Delhi – although only a few miles apart - operate in different states. You must look for the right location, one that has favorable laws, government incentives, the best infrastructure and workforce or the right partner for your product or service."
There are 15 official languages in India as well as hundreds of local dialects – however, English and Hindi are the most common and English is generally considered the neutral language and is almost
Ethnic groups: Indo-Aryan 72 percent, Dravidian 25 percent, Mongoloid and other three percent (2000)
Language: Hindi, English (plus 22 regional languages)
Capital: New Delhi
National Holidays: New Year's Day (Jan. 1); Republic Day (Jan 26); Liberation Day (Apr 25); May Day (May 1); National Day (Jun 2); Independence Day (Aug 15); Gandhi Jayanti (Oct 2); Diwali (Oct 26); All Saints’ Day (Nov 1); Christmas Day (Dec 25); Boxing Day (Dec 26)
Business hours: Government Offices: Mondays to Fridays: 09.30 - 17:30; Offices: Mondays to Fridays: 09.30 - 17:30 (on Saturdays until 14:00); Banks: Mondays to Fridays 10:00 - 15:00 (on Saturdays until 13:00); Stores: Mondays to Saturdays 09:00 - 19:00.
universally spoken, especially in business. Relationships, especially family, are very important in India – as such, small talk will often revolve around family matters. Saying ‘no’ is disliked so any vague answers or maybes should be treated with caution.
When introducing yourself on the first meeting, introduce yourself as Mr or Mrs. You should never use a counterpart’s first name until you have been invited to do so.
Businesses will be run in an extremely hierarchical manner, usually with one top manager. Individuals will be given very authoritative instructions, which they will be expected to follow without question. Any foreign companies must liaise as closely with top management as they can or getting decisions is likely to be difficult. Indian culture is very different from British culture and it is valued by Indians when visitors have made some effort to understand the differences.
While Indian women are not often found in management roles, the rank of foreign individuals will come before gender. However, women must take care to be extremely formal towards men at all times.
Things to remember
- Make the other person lose face. As a foreigner, avoid shouting at an Indian or reprimanding her/him in front of peers. If an Indian manager shouts at his/her subordinates, it does not mean that you can or should.
- Accept every ‘yes’ as a real yes. “Yes” often merely means “I have heard you.” Learn to recognise the "No" as Indians don’t say No directly, unless it is a crucial issue. The No is always hidden in niceties and lots of “yes” words and body language and gestures.
- Most Indians are proud of their rich history and appreciate intelligent discussions with mutual respect. However, do not lecture about democracy, social equality and women’s rights etc.
- Lose your temper over frequent interruptions, digressions or bargaining in meetings and negotiations.
- Expect quick commitment. India is a hierarchic society and decisions take time. Decision-making may involve people not present in meetings or negotiations.
- Never use your left hand for eating, serving, or taking food or handing over or accepting things. The left hand is considered the toilet hand and thus taboo. This is a challenge for left-handers.
- Do not turn up in a business meeting wearing Indian style clothes, especially the “Indian” hippie style clothes sold in cheap shops in Western countries.
- Address Indian business partners publicly by their first name unless it has been specifically agreed upon. Seniority is important to the Indians. This is more important when dealing with people in the public sector.
- Get upset when someone asks personal questions about your age, marital status, income, and family background.
- Buy the same gifts for everyone in the same organisation. Show respect according to rank and seniority. Buy better gifts for the senior leaders.
The style of meetings varies according to the type of company you are working with. Some companies are becoming more Westernised, especially in the technological sector. Other companies have a very different approach – meetings may seem very informal with many interruptions. If meeting over a meal do not thank the host at the end of the meal – it is considered a form of payment and is insulting.
Gift giving is a common occurrence in India. The person who gives the gift should thank the person they are presenting it to. Gifts should always be wrapped (never in black or white paper, as they are considered unlucky) and should not be opened in front of the giver.
Teamwork in India is viewed very differently from in Britain. Instructions are given by leaders and followed to the letter. There is always a team leader who takes full responsibility for the success or failure of each project.
Although conservative clothing should be worn, ties are not necessary unless you are meeting with a company in a traditional sector such as accountancy or law. Always avoid wearing leather – one of the foremost religions in India is Hindi and leather is offensive as cows are a sacred animal.