Over the time I have been observing bilateral relations between Spain and India, the similarities between the two peoples never cease to surprise me. Having lived in Spain and now in my country of origin, India, has allowed me to appreciate the respect for tradition, adhesion to family values and hospitality that are common denominators between the two societies.
"Youth is one of the traits that characterises Indian society"
A total of over 373 million Indians are between 10 and 24 years old, making up 27.5% of the whole population1. It falls to the new generations to be the drivers of growth not only for India, but for the whole world. This youth is what is driving the economy and what businesses need to focus on. It is a generation that is exposed to globalisation and an opening up that enables them to be connected to the world and to the trends and influences that are shaping the future. Moreover, average growth of over 7% over the last 20 years2 has meant people have greater purchasing power, creating one of the most dynamic middle classes. This middle class is the present and future of India.
"Despite excellent growth rates, infrastructures remain the big matter pending and one of the greatest obstacles to the country's economic development"
Even though the government has been investing in modernisation for years, it has not reached the level required. Despite excellent growth rates, infrastructures remain the big matter pending and one of the greatest obstacles to the country's economic development. Car sales remain ahead of the pace of road and bridge building. The big cities now have metros; Delhi, for example, has one of the most extensive networks. In addition, the main ports need modernising urgently, as they are unable to cope with the total traffic because of a lack of new port facilities. The electrical deficit is not improving and demand is growing ahead of the increase in generating capacity. Aware of this issue, central government has increased the funds allocated to infrastructure development for this year.
The country's rapid, chaotic urbanisation, the result of high immigration from the countryside to urban centres, has put pressure on cities. Everything to do with urban development and management, from Smart Cities to affordable housing, is among the government's main priorities. This offers a wide range of business opportunities in areas where Spanish business has wide experience.
"Another of the sectors where Spanish business is at home is the automotive industry"
Companies supplying the top car makes are already in India, with high levels of investment in production plants. The country not only has a vigorous market - sales of cars for private use grew by 7.89% in the last tax year3 - but has also become a major hub in production for export.
Another of the many opportunities in India is for Spanish renewable energy companies. After ratifying the Paris agreement, the government is committed to clean power, turning India into the second most attractive market for renewable energy in the world, according to the Renewable Energy Country Attractiveness Index 2017. As prime minister Narendra Modi has said repeatedly, the country has the ambitious goal of reaching an installed renewable capacity of 175 GW by 2022. While energy consumption per inhabitant is very low, it must be borne in mind that this is a country with over 1,350 million people, indicating that the sector has a more than promising future. Furthermore, according to the International Energy Agency, the demand for energy will increase considerably by 2040.
Being present in India means getting closer to the market on the Indian subcontinent. Countries like Bangladesh or Sri Lanka are at a key point in their history and offer attractive opportunities. Bangladesh, for example, is a country with 167 million people (more than France, Germany and the Netherlands combined)4 which has been growing at a rate of over 6% since 2011.
"India is one of the big matters pending for Spanish business, which is looking at the country but at times with a certain fear and apprehension"
Anybody thinking of embarking on this adventure must do so on the basis of good advice. In fact, India is not a single market, but a territory with attractive prospects and varying circumstances. Clear ideas and the support of a team of professionals specialised in the region are of key importance to success.