Germany buys into Make in India buzz

08-Oct-2015 #MakeInIndia Source: India Inc

German Chancellor Angela Merkel’s visit to India this week marks a turning point in the Indo-German relationship, which has lagged behind its potential for years.

A new fast-track approvals pact would mean the 1,500 German companies already in business in India could multiply fast. Indian and German companies have already signed five agreements on smart mobile urban solutions, software defined radios, development of solar projects, skills development in electrical semi-conductors and collaboration in machine tools.

Digital India, Skill India and Start-up campaigns were also showcased to the high profile business delegation accompanying Chancellor Merkel. Besides, there was the much-hyped German offer of $2.25 billion to assist India in developing its clean energy corridor and solar projects.

But Merkel’s message was loud and clear: “More reforms will give more impetus to German industries to invest in India. German companies want to be treated on par with Indian companies and creation of an equitable market is crucial for investments.

“German engineering and Indian IT must fuse and complement each other. IT companies in Bangalore are a reliable engine of development for India.

“India needs jobs, Germany needs people and collaboration is crucial to meet the demographic needs of both countries. Our companies value India as a location for manufacturing and as a market.”

India and Germany have an annual trade volume of €16 billion and with a business volume of €10 billion flowing in through German companies in India, the European giant is an important investor for India.

Prime Minister Modi recognises this and called on the country to take advantage of a changing dynamic in India.

He said: “With a very open and global mindset we have worked aggressively to make India an easy place to do business. We are committed to creating favourable conditions for business and industry because we believe that they are necessary for improving the lives of ordinary citizens.

“Our commitment and aggressive nature in achieving our goals in a faster manner creates immense opportunities for German companies. Never before was India so well prepared to absorb talent, technology and investments from outside. It makes sense to be in India and it makes stronger business sense to Make in India.”

Merkel’s visit to India was a follow up to Modi’s own tour of Germany and the Hannover Trade Fair earlier this year and the result is likely to be a renewed fervour among German firms considering an India base.

However, whether the stalled Free Trade Agreement (FTA) with the European Union receives the desired push with this tour, remains uncertain.

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