Financial Services

An Expert's View about Finance in India

Posted on: 18 Feb 2012

The financial sector in India is characterised by liberal and progressive policies, vibrant equity and debt markets and prudent banking norms.

Financial Services in India British businesses are seen as easy to deal with and more open than most in sharing technology. The financial services sector is already the largest contributor to the UK economy, as measured by net earnings by UK companies from FDI. Market overview India is one of the fastest expanding economies in the world, with a rapidly expanding consumer base – more than half the population are under 25 years old. Improvements in infrastructure are encouraging foreign companies to look beyond Mumbai and Delhi to the huge opportunities in India’s emerging cities. Economic liberalisation continues to progress, with trade barriers being removed and privatisation programmes gradually reducing the role of the public sector in the production and consumption of goods. The process of reforms as part of liberalization has resulted in greater investment in the Indian economy. Government policies have become investment friendly and paper work has reduced. The capital markets have also been able to receive huge inflows of funds. The Indian economy is ready to face competition from overseas markets and as a result international investors see India as a potential market for excellent returns on their investment. Key opportunities UK companies themselves believe and call for reform, as they stand to gain from liberalisation. We estimate, even with no increase in market share, the UK should be earning £800m per year from banking and insurance alone (this assumes that the sector grows by 100% from 2008 – 2012 as predicted by KPMG). With some gradual liberalisation, which allowed UK firms to double their current market share, we could be earning £1.6bn per year and if India were to become as open as South Africa, for example, then we would predict closer to £3bn by 2012. ξ The financial sector in India is characterised by liberal and progressive policies, vibrant equity and debt markets and prudent banking norms. ξ India has a transparent, highly technology-enabled and well-regulated stock market with the largest number of listed companies – approximately 10,000 - across 23 stock exchanges. India has the third largest investor base in the world. ξ The country also has a vibrant and modern commodities exchange market. NCDEX, MCX and NMCEI are the major national exchanges with a diversified portfolio of commodities that include agri-products, bullion, metals and energy. The exchanges offer future contracts and India was the first to provide trading in steel futures. ξ Quenching its thirst for foreign assets, India Inc announced 177 M&A deals worth US$ 26.8 billion in the first nine months of 2011. For the quarter July-September 2011, inbound deals worth US$ 7.32 billion were registered as against the deals worth US$ 2.65 billion in the previous quarter. Latest export opportunities – Financial & Professional Services Latest export opportunities - India Getting into the market British companies wishing to develop their business in the India market are advised to undertake as much market research and planning as possible in the UK. UKTI’s team in India with its wide local knowledge and experience, can provide a range of services to British-based companies wishing to grow their business in global markets. This can include: ξ Provision of market information ξ Validated lists of agents/distributors ξ Key market players or potential customers in the Indian market ξ Establishment of interest of such contacts in working with you ξ Arranging appointments ξ Organise seminars or other events for you to meet contacts and promote your company in the Indian market This work is available via our Overseas Market Introduction Service (OMIS) a chargeable service which assists British-based companies wishing to enter or expand their business in overseas markets. More about doing business in India Contacts Market intelligence is critical when doing business overseas, and UKTI can provide bespoke market research and support during overseas visits though our chargeable Overseas Market Introduction Service (OMIS). To commission research or for general advice about the market, get in touch with our specialists in country - or contact your local international trade team. ξ Sheela Kulkarni, UK Trade & Investment, The British Deputy High Commission, Mumbai. Tel: +91 22 66502258 or email: Contact your local international trade team Major Events Lord Mayor’s visit to London, with trade delegation Date: Oct 2012 (Lord Mayor’s Overseas Visits 2011-12) UKTI Events UKTI runs a range of events for exporters, including seminars in the UK, trade missions to overseas markets and support for attendance at overseas trade shows. Latest events – Financial & Professional Services Latest events – India Useful links More about OMIS and other UKTI services for exporters
Posted: 18 February 2012

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