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INDIAYes Yes, No Problem?
�© Project India 2005
�© Project India 2005
“India will be the global high-tech engineering hub in the near future. Swedish engineers must take part in this development.”Anders FlodströmPresident, Royal Institute of Technology (KTH)
� © Project India 2005 �© Project India 2005
© Project India 200�
International Business Association for Students
KTH
www.projectindia200�.com
EDITORS
Project India 200�, Dr. Simon Moores
AUTHORS
Viveka Andersson, Fabian Bonnier,
Per Wennerström, Marie Håkanson,
Sam Rahbar, Pernilla Emenius,
Robert Lagerström, Malin Olin,
Harald Knape, Sofia Groth
GRAPHIC DESIGN
Harald Knape, Fabian Bonnier
PHOTOS
Harald Knape, Project India 200�
Fälth & Hässler, Värnamo
PRojECT INDIA 2005
� © Project India 2005 �© Project India 2005
Project India 2005 is a one-year journey through culture, political and business issues in India. The unique project-based course is initiated and run by students at the Royal Institute of Technology (KTH) in Stockholm. The aim of the venture is to analyse the potential of the Indian market – to investigate what Sweden and India can gain from this business cooperation.
The project group consists of ten students with different backgrounds and experiences, deliberately selected to form a unanimous and strong team. Close to receiving our Master degree, the course is an opportunity for us to challenge our analytical and engineering skills as well as our knowledge in finan-cial and cultural issues. This is achieved by letting responsibilities, normally handled by the faculty, rest on us. These include setting up course goals, administrate the work, finding project partners and finally present the result with a seminar and this book.
Our journey with Project India 2005 is coming to its end. Through the year, we have gained invaluable experiences in project organization, teamwork and international business. We are proud to present this book, in which we have assembled our experiences, analyses and results based on relevant literature, interviews and personal reflections.
We would like to take the opportunity to thank all persons involved in this project; both in Sweden and in India. We are truly honoured by the generosity, interest and support you all have shown. A special thanks to all our project partners, The Royal Institute of Technology and our supervisor Professor Gunnar Benediktsson for giving us the responsibility to run Project India 2005.
Project India 2005 - Stockholm October 2005
� © Project India 2005 �© Project India 2005
INTRo
India, Yes Yes No Problem? 10
The Land of Contrast 11
An Exciting Journey 12
ECoNoMY
Brief Historical Outline of the Economy 18
Introduction to a New World 20
Sweden vs. India in Figures 22
The Major Market Segments 2�
Outsourcing Trends (outsourced article) �6
How to Outsource Outsourcing ��
The Indian Giants �2
The Backside of India’s Economic Boom ��
India - Threat or Possibility �6
START-UPS
Advantages and Challenges �0
Project India 2005 Starts a Company! �6
Other Swedes in India ��
Contents
PRojECT INDIA 2005
� © Project India 2005 �© Project India 2005
INfRASTRuCTuRE
Mission Impossible 66
The Monsoon in Mumbai and Project Air India 72
Bangalore year 20�0 7�
CuLTuRE
Cultural Differences 7�
Poverty ��
Education �6
THE END
Conclusion �0
Members of Project India �2
Acknowledgements ��
Partners ��
10 © Project India 2005
PRojECT INDIA 2005 -
The aim of this book is to inspire; to give you a glimpse of India, the giant country that will take a central role in what might become the Asian Century.
Please do not read this book from start to end: open it, browse it through and find an article or some pictures that are especially interesting to you. Maybe you want to read about Royal Shirts, a company we started in order to illustrate how to operate a business in India.
Or why not study outsourcing? We did that by out-sourcing a chapter in this book – check out the re-sult.
10 © Project India 2005
INTRoINDIA, YES YES No PRobLEM?
THE LAND of CoNTRASTAN ExCITING jouNEY
12 © Project India 2005
PRojECT INDIA 2005 -
13© Project India 2005
India, Yes Yes No Problem?
Why is north Indian food fattier than food
in the south? You will find some reflections
on this in the chapter about culture. What
does the word “Volvo” mean in India? You
can read about this in the chapter on mar-
keting. Yes yes, no problem, is a commonly
heard phrase in India that reflects the peoples
optimism towards the future. However, the
country has many challenges to face which the
question mark in the book’s title is meant to
illustrate. Our overall perspective is that India
is the country of diversity, which we will show
in this book. India is the country, where you
can expect the unexpected.
As Swedish engineering students we have
since January 2005, and especially during
our journey through India in August 2005,
had the luxury of exploring a country which
most definitely will grow to be one of the most
important countries of our future. The pur-
pose of this book is to create curiosity and an
insight into India by sharing our experiences.
This book will give you our picture of India.
We cannot simply after a month-long visit and
half a year of studying the country claim to be
experts on the subject. What we can and will
do, however, is share with you our own expe-
riences and opinions about a country with
more than 5,000 years of history and which is
home to one-sixth of the world’s population,
half of them being under the age of 25.
We hope that you will enjoy reading this
book and perhaps become inspired to carry
out further studies, make investments or
travel to India.
We are up in the mountains outside Aurangabad. Some children were playing cricket at a play yard when we passed by. As you can see in the picture, they got truly excited when we asked if we could join them in the game.
INTRo
12 © Project India 2005 13© Project India 2005
The Land of Contrast
“East is East and West is West and nev-
er the twain shall meet”, wrote Rudyard
Kipling, a British writer and soldier in In-
dia. In today’s world of highly complex
technological interdependence, India still
appears to most Europeans as an incom-
prehensible culture. This is a problem
as it sometimes discourages companies
from starting up in India. The root of the
problem is ignorance, which creates ste-
reotypes and cultural misunderstandings.
A better knowledge of India is justified not
just by the opportunity of good business
in an important part of today’s economic
market, but also by the fact that one out of
six people on Earth is Indian. This chapter
will give you a short introduction to “The
Land of Contrast”.
LAND of CoNTRAST
“The Land of Contrast” is a commonly
used phrase when describing India. Few coun-
tries in the world are as diversified as India.
India is therefore best viewed as a continent
rather than as a country. From north to south
and from east to west, the geography as well
as the people, the language, the culture and
traditions differ completely. Traveling in
India provides one with memories for life
and impressions, which may turn the world
around. In India, you will get to see the snow
covered Himalayas, the sunbathing paradise
beaches, extreme poverty as well as enormous
wealth.
WoRLD’S bIGGEST DEMoCRACY
“India’s biggest disadvantage compared to
China is that it is a democracy”, states Philip
Davidson, MD of Atlas Copco India. “But the
fact that India is a democracy is also India’s
greatest advantage”. In China, the government
acts extremely fast in all political decisions.
But what happens when the citizens cannot
influence the results? In India, however, the
system tends to be slow and badly affected by
the complicated bureaucracy. Rapidity, how-
ever, can never match the value of freedom
to challenge your brain and create new ideas;
something not allowed under a dictatorship.
It is hard to fully grasp the magnitude of
a national election in India. The electorate
exceeds 670 million voters in about 700,000
different polling stations spread across the
country. One national government and 28
state governments are elected out of more
than 5,000 candidates (2004 election). In
the 2004 election the Election Commission
INDIA
Capital New Delhi
Independence 15 August 1947 (from UK)
Population 1,080,264,388 (2005 est)
0-14 years: 31,2%
15-64 years: 63,9%
Climate varies from tropical monsoon
in south to temperate in north
Population growth rath 1.4% (2005 est)
Ethnic groups Indo-Aryan 72%,
Dravidan 25%,
Mongoloid and other 3%
Religions Hindu 80.5%, Muslim 13.4%,
Christian 2.3%, Sikh 1.9%
and other groups including
Buddhist, Jain Parsi 1.8%
Literacy definition: age 15 and older
who can read and write.
total population: 59.5%, male:
70.2%, female: 48.3%
Above: Jawahalal Nehru (left) India’s first Prime Minister speaking to Mahatma Gandhi. Below: Manmohan Singh (left), Sonia Gandhi.
14 © Project India 2005 15© Project India 2005
An Exciting journey!
employed almost 4 million people to help the
actual 390 million who voted, not counting
the vast number of civilian police and security
forces who ensured that the election was car-
ried out peacefully.
After the last election in May 2004 it was
clear that the 19 party coalition UDP, with its
leader Sonia Gandhi, an Italian-born widow
of the former Prime Minister Rajiv Gandhi,
had unseated the ruling National Democratic
Alliance (NDA). Sonia Gandhi, however,
renounced the Prime Minister’s post and pro-
posed that the noted economist, Manmohan
Singh, replace her as Prime Minister. Even
though Manmohan Singh today is the Prime
Minister, Sonia Gandhi plays an important
role in keeping the coalition together.
HISTORy
The Indus Valley civilization, one of the
oldest in the world, dates back at least 5,000
years. Aryan tribes from the northwest invaded
Januari 2005
Project India 2005 started. The following 7 months were dedicated to
extensive preparations for our travel to come.
July 28 – August 7
Our first days in India were full of impressions; hectic traffic, noise,
intense colors, heat, humidity, Indian spices and smells. We went to
Rishikesh in the north and to Agra to see the Taj Mahal.
August 8
We met the journalist Narendra Taneja and the KPO company
Evalueserve.
August 9
The project group visited Ericsson’s main office in Gurgaon and dinner
at the Swedish Embassy.
August 10
We visited Indiska’s New Delhi office and one of their suppliers.
August 11
The group visited SECO Tools India’s headquarter/plant in Pune.
New Delhi
Pune
Cochin
Agra
Mumbai
Bangalore
14 © Project India 2005 15© Project India 2005
around 1500 B.C. and created the classical
Indian culture. Arab and Turkish incursions
in the 8th and 12th centuries respectively were
followed by those of the European traders in
the late 15th century.
By the 19th century, Britain had political
control of all of India. Non-violent resis-
tance to British colonialism led by Mahatma
Gandhi and Jawaharlal Nehru resulted in
independence in 1947. The subcontinent was
divided into the secular state of India and the
smaller Muslim state of Pakistan. A third war
between India and Pakistan in 1971 resulted
in East Pakistan becoming a separate nation
known as Bangladesh.
All of these waves of immigration have
given India a complex culture with many dif-
ferences, which are apparent in, for example,
the 17 major languages. Spiritual acceptance
is also peculiar to India as every religion
is represented, including Hinduism, Islam,
Buddhism, Sikhism, Jainism, Zoroastrianism,
Jewry and Christianity.
August 12
We visited Atlas Copco and gave interviews to three Indian newspa-
pers.
August 13 – August 15
Saturday morning we left Pune for Aurangabad.
August 16
We learned about outsourcing at Capgemini, missile technology at
L&T (LARSEN & Tubro) and schooling for the poor in India at the
Akanksha school.
August 17
At the harbor of Mumbai we learned about the logistics of Indiska. We
also visited the Indian Institute of Technology (IIT).
August 18
Some of us had a meeting with Astra Zeneca and some of us visited
IBM in Bangalore.
August 19
The group visited Volvo’s production plant and head office.
August 20
Some of us went back to Sweden and some of us stayed for another
two weeks of vacation.
New Delhi
Pune
Cochin
Agra
Mumbai
Bangalore
Gurgaon, New Delhi
Veer Savarkar Road, Mumbai
Volvo, Bangalore
Allepey beach, Kerala
Taj Mahal, Agra
Atlas Copco, Pune
Astra Zeneca, Bangalore
17© Project India 2005
17© Project India 2005
After having gained independence indus-
trialism started to take root, the population
grew and people moved from rural to urban
areas. A massive film industry, Bollywood,
was born in Mumbai and many other cultural
programs started. Lately, India’s economy is
booming, the political situation is more stable
and the optimism among people is high. Once
again, India must not be seen as a country, but
as a continent.
GEoGRAPHY
India, with an area of 3.3 million sq. km,
is a subcontinent divided into 28 states. The
peninsula is separated from mainland Asia
by the Himalayas. The country is surrounded
by the Bay of Bengal in the east, the Arabian
Sea in the west and the Indian Ocean in the
south.
The Himalayan region has a rich vegeta-
tion with varieties that can virtually be found
in the tropical to the tundra regions. Only
the altitude influences how the vegetation is
dispersed. In the rest of the country the type of
vegetation is largely determined by the amount
of rainfall. Outside the Himalayan region, the
country can be divided into three major veg-
etation regions: the tropical wet evergreen and
semi-evergreen forests, the tropical deciduous
forests, and the thorn forests and shrubs.
At the footstep of Himalaya lies Rishikesh. People from all India go there to see the Ganga.
18 © Project India 2005
PRojECT INDIA 2005 -
ECoNoMY
India’s diverse economy includes tradi-
tional village farming, modern agriculture,
handicrafts, industries and services. The
country is capitalizing on its large numbers
of well-educated people skilled in the English
language.
The Indian economy is growing rapidly
but that has not always been the case. For
many years, socialism dominated the Indian
market, holding back privatization and for-
eign trade. Since the 1990s the government
has eased the pressure on the market, but
there are still a lot of problems to overcome
in order to boost economic growth further
and improve the lives of the poor. Controls on
both foreign trade and investment have been
reduced in some areas, but high tariffs and
limits on foreign direct investment are still in
place. The privatization of government-owned
industries has proceeded slowly, but political
and economic inflexibility continues to block
the required initiatives.
Timeline 1947-2004:
INTRo
War with
Pakistanover the Kashm
ir border.
Congress
Party, le
dby Ja
waharlal N
ehru,w
ins fir
stgenera
l electio
n.
Deathof Prim
e Min
ister Ja
waharlal N
ehru.
Former Prim
e Min
ister Nehru
'sdaughte
r Indira
Gandhi beco
mes Prim
eM
inist
er. India
devalues ru
pee
by 57.5%afte
r press
urefro
mth
e World
Bank
India
becom
es the world
'ssix
thnucle
ar power.
Indira
Gandhi retu
rns to
power as headof th
e
The Congress
Partylo
ses th
e general e
lection.
India
join
s the W
TO.
The BJPfo
rms a co
alitio
nheaded
by Prime M
inist
er Atal B
ehari
India's
billionth
citize
nis
born.
Adip
lom
aticoffe
nsive is
launched
toavoid
war withPakist
an.The US
andth
e UK urge th
eircit
izens to
leave India
and
Congress
Partywin
s the genera
l electio
n.
Manm
ohanSin
ghbeco
mes Prim
eM
inist
er.
India
gains in
dependence.
First 5 Year Plan,whichrepresents a period
of progressive liberalization.
Secondwar with
Pakistanover Kashm
ir.
The massive devaluation
leads to strongdom
estic pressure.The progress made by
liberalizationis stopped
andim
port controls are tightened.
Thirdwar with
Pakistanover the creation
of Bangladesh(form
er East Pakistan).
Indira Gandhi's Congress Party loses the election.
Indira Gandhi murdered
by bodyguards.Her son, Rajiv Gandhi, takes over.
Rajiv Gandhi murdered
by a suicide bomber sym
pathetic to the Tamil Tigers from
Sri Lanka.The economic liberalization
reforms begin.
The Congress Party is defeatedby the Hindu nationalist BJP,which
takes over the
reigns of power.
Vajpayee meets with
Pakistan's Premier Nawaz Sharif to sign
a peace declaration.
Former scientist, APJ Abdul Kalam
, is electedpresident
1947 - 1951 - 1951 - 1964 - 1965 - 1966 - 1968 - 1971 - 1974 - 1977 - 1980 - 1984 - 1989 - 1991 - 1995 - 1996 - 1998 - 1999 - 2000 - 2002 - 2004
Oxford Analytica, India: A Five Year Outlook
18 © Project India 2005
ECoNoMYINTRoDuCTIoN To A NEW WoRLD
THE MAjoR MARKET SEGMENTSHoW To ouTSouRCE ouTSouRCING
20 © Project India 2005
PRojECT INDIA 2005 -
In order to understand the changing and
dynamic Indian market, one needs some
basic knowledge about the history.
After the Second World War, India
declared its independence in 1947. This was
followed by an economic policy influenced
by the Soviet planned economy. For a long
time, the country had a very moderate eco-
nomic growth – slower than many other
underdeveloped countries. Between 1947 and
1980 the GDP increased on average by 3.5%.
However, given an annual population growth
of 2.2% this represents a per capita growth
of approximately 1%. During this period,
India’s economic development strategy aimed
to achieve self-sufficiency and was totally
controlled by the government. High tariffs
and a complicated system of import licenses
protected the domestic trade from overseas
competition. Imports of consumer products
were prohibited with some exceptions, which
were charged with import taxes up to 300%.
At this time, the government employed 70%
of the work force. This was a time of bureau-
cracy and India’s share of world trade fell
from 2.5% in 1938 to 0.5% in 1980.
During the 1980s, the GDP in India started
to increase. However, the reason was much
as a result of borrowed resources. In 1991,
India faced a deep economic crisis and was on
the verge of bankruptcy. They could hardly
pay their debts and could not borrow more
money.
In June 1991, Narasimha Rao became
Prime Minister and took the controversial
decision to appoint the Oxford-educated
economist Manmohan Singh as the Minister
of Finance. He claimed that India could be a
global economic power by implementing the
following two new reforms. The first aimed
to open up the economy globally in order to
attract foreign investors. The second intended
to reduce the bureaucracy – by this time one
needed a license for nearly everything. Since
this economic liberalization, India’s economy
has grown on average by 6% a year and the
country is starting to be a key player in the
economic world.
Brief Historical Outline of the Economy
38 % of the doctors in USA are Indians
36 % of the scientists at NASA are Indians
34 % of Microsofts employees are Indians
12 % of USAs scientists are Indians (Source: Evalueserve)
ASToNISHING fACTS AbouT INDIA
Measured in number of films and movie visitors, the Indian movie industry
is the largest in the world, with a turnover of 40-50 billion SEK.
(Source: SvD)
The worlds richest man is an Indian born businessman, named Lakshmi
Mittal. (Source: DN)
The third riches man on Earth is Aziz Premji, CEO of Wipro Industries.
(Source: Fortune Magazine)
Pictures from the world famous movie Monsoon Wedding
ECoNoMY
20 © Project India 2005
22 © Project India 2005
PRojECT INDIA 2005 -
2�© Project India 2005
A great new economic power is taking
shape in the East. India is bubbling with
optimism and is ready to play a big role in
the world market. This chapter will give a
brief introduction to the market that will
take a central role, in what might become
the Asian Century. “Understanding the In-
dian market is a must for the next genera-
tion of engineers”(Prajeet Patel).
The Western perception of India has
changed radically. When you open the news-
papers nowadays you find headlines like
“India’s spinning wheel arouses global anxi-
ety” (Svenska Dagbladet, August 26, 2005).
This has not always been the case. When one
searches for articles concerning India some 20
years back, they typically described the same
thing: a small, poor, urban village. There, the
journalist would find a widow with many chil-
dren from a lower caste. Some heartbreaking
photos were taken and the story was about
epidemics, starvation and poverty. Finally, the
article was headed “India: A Huge Country
on the Verge of Collapse” (Time Magazine,
1975). Basically, these were the Western per-
ceptions of India until lately.
Even though India is still a very poor
country in many respects, it is starting to
become a strong economic power with a huge
and diverse industry. India has, for example,
developed its own space program and nuclear
power plants. In the outsourcing industry,
many believe that India will be the number
one – the back office of the world. The middle-
class is growing rapidly; today it includes up
to 300,000,000 people, and their consump-
tion is rising even faster. The newspapers are
filled with articles with headlines like “India
is moving fast to become the global economy
power No. 1”. True or not, you can literally
feel the optimism when visiting universities
and companies – they are eager to compete
with the rest of the world.
In order to estimate a developing country’s
potential as a trading partner, one needs to
consider its economic growth, for which GDP
growth is a measurement. Without a stable
economic growth, the country might not be
able to make essential investments to produce
attractive export products. The country’s
imports of value products will also decrease
sooner or later if the growth is not stable.
Economic growth is also needed for long-term
social development as it reduces poverty and
increases the opportunities for households to
make savings and investments. A stable eco-
nomic growth also improves the government
income, which may be used for investments
in economic and social development, for
example, health, education and infrastructure.
Since 1991, when economic liberalization
Introduction to a New World
Since 1991, India has been among the top ten growing economies in the world. Considering India’s huge population, this has a dramatic influence on the global economy.
The Indian Market
ECoNoMY
Rate of GDP growth in India
-4
-2
0
2
4
6
8
10
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005f
India Sweden
1991
22 © Project India 2005 2�© Project India 2005
reforms were started, India has been among
the top ten growing economies in the world.
Considering India’s huge population, this has
a dramatic influence on the global economy.
Looking ahead, investment firm Goldman
Sachs predicts that India will be the third larg-
est economy by around 2030. An even wider
spectrum of India’s population will escape
from poverty and contribute to an enormous
market of consumers and a huge, highly quali-
fied manpower. India will certainly, together
with China, take a central role in what might
become the Asian Century. Consequently, India
is becoming an even more important business
partner for Sweden. “I am convinced that in
many ways, Sweden’s future, and the future
of the European Union, of which Sweden is a
member, lies with India”, said Inga Eriksson
Fogh, Swedish Ambassador to India.
It is important to remember that India
must not be seen as a single economy. The
economic differences are huge between
regions, cities and the countryside, or even
more so between the parts of India that have
been influenced by modernization and the
ones that remain unchanged and extremely
poor. There is an incredibly rich elite and a
growing middleclass. In Mumbai alone there
are over 45,000 millionaires (USD). However,
it should not be forgotten that a huge part of
the poorest people in the world live in India.
So, once again, India should not be seen as a
country, but as a continent!
Back in 1975 it was a mistake to only
illustrate India as a country on the verge of
collapse, and it is also a mistake today to be
worried that India will soon take over as the
economy of the world. But the Indian market
is indeed an increasingly important global
player and must be considered accordingly.
“Understanding the Indian market”, explained
Prajeet Patel of Evalueserve, “is a must for the
next generation of engineers”.
2� © Project India 2005
PRojECT INDIA 2005 -
2�© Project India 2005
ECoNoMY
Sweden vs. India in Figures
MACRo ECoNoMIC
Population: 9.0 million (2005)
Adult literacy rate: 99%
GDP total: USD 240.3 billion
GDP per capita: USD 27,310
Components of GDP (% of total): Private consumption (48.7), Public
consumption (28.0), Investment (17.2),
Exports (43.3), Imports (-37.2)
Main Sectors of the Economy: Iron and Steel, Equipment (bear-
ings, radio and telephone parts,
armaments), Wood, Pulp and Paper
Products, Processed Foods,
Motor Vehicles
Principal exports (billions of USD): Machinery and transport equipment
(41.1), Wood and paper products (11.3),
Chemicals (9.7), Manufactured goods
(9.4), Total incl. others (81.1)
Principal imports (billions of USD): Machinery and transport equipment
(30.5), Miscellaneous manufactured
goods (14.1), Chemicals (7.9), Mineral
fuels (5.9), Total incl. others (66.5)
Top 5 trading partners + Sweden: 1. Germany, 2. Norway, 3. USA, 4. UK,
5. Denmark, 25. India
Total Trade HistoryUSD bn
0.0
20.0
40.0
60.0
80.0
100.0
120.0
1999 2000 2001 2002 2003
ExportImport
buSINESS CLIMATE
Corporate tax rate: 28%
Employment costs: USD 47,636 (annually)
Number of university students: 320,000
Internet users: 6,700,000 (73.6% of population)
Cell phone users: 8,190,000 (91% of population)
Swedish Exports to India
287
512
295211 221
285359
642
879
1128
0
200
400
600
800
1000
1200
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
USD mn
Sweden
(Source: Sweden – India Business Guide 2005-2006)
2� © Project India 2005 2�© Project India 2005
MACRo ECoNoMIC
Population: 1 082 million (2005)
Adult literacy rate: 61.3%
GDP total: USD 510.2 billion
GDP per capita: USD 490
Components of GDP (% of total): Private consumption (64.4), Public
consumption (12.5), Investment (12.5),
Exports (22.8), Imports (-15.2)
Main Sectors of the Economy: Textiles, Chemicals, Food Processing,
Steel, Transportation Equipment,
Cement, Mining, Machinery, Software
Principal exports (billions of USD): Gems and jewellery (8.8), Engineering
goods (8.4), Textiles (5.8), Ready-made
garments (5.4), Chemicals (5.0), Total
incl. others (49.3)
Principal imports (billions of USD): Petroleum products (17.7), Capital
goods (7.7), Gems (6.1), Electronic
goods (5.4), Total incl. others (56.5)
Top 5 trading partners + Sweden: 1. USA, 2. China, 3.UAE, 4. UK,
5. Belgium, 29. Sweden
buSINESS CLIMATE
Corporate tax rate: 30%
Employment costs: 2,167 USD (annually)
Number of university students: 7,078,000
Internet users: 39,200,000 (3.6% of population)
Cell phone users: 41,000,000 (3.8% of population)
India
(Source: Sweden – India Business Guide 2005-2006)
Indian Exports to SwedenUSD mn
199 191 200 189 183205 208 208
268
307
0
50
100
150
200
250
300
350
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Total Trade history USD bn
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
1999 2000 2001 2002 2003
ExportImport
26 © Project India 2005
PRojECT INDIA 2005 -
27© Project India 2005
The Major Market Segments
Our visits to different companies in India
gave us the opportunity to look at the emerg-
ing market of India. The rapid growth in India
during the last decade is often associated with
the IT sector, and other industries are not
far behind. The agriculture sector, which
corresponds to 23.3% of GDP and 60% of
the population, is also of huge importance
to the country, but will not be dealt with in
this chapter. Some of the rapid growing sec-
tors with high international importance will
be presented. India is well known for its
outsourcing industry. This segment is of such
great importance that we have dedicated a
whole chapter to it. Related market segments
will also be covered briefly.
ECoNoMY
26 © Project India 2005 27© Project India 2005
India and China have the highest market
growth in the telecoms sector globally.
Recently, phone connections in India have
passed the 100 million mark, which means
that over 9% of Indians have a phone. The
cell phone penetration in India is today
about 6%, which is relatively low com-
pared with other markets. The market is,
however, growing fast and adding some 2
million new customers per month.
The Indian cell phone industry is expected
to grow from USD 12 to 27 billion in four
years. This will probably come from new dis-
tribution channels and value-added services,
for example, ring tones (Financial Times,
August 22, 2005). By next year, the country
will have a network covering 350,000 vil-
lages and connecting 450 million people (The
Times of India, August 15, 2005). Dayanidhi
Maran, State Minister for Communication
and IT, forecast that India would have 250
million telephones by 2007, which means a
teledensity of about 22%.
When traveling in India, you can clearly
sense that telecoms is a huge industry. Even
in the smallest village there is no doubt that
you can find a cell phone shop and one can
literally see commercials for cell phones
or operators everywhere. Many cell phone
manufacturers are focusing on cheap phones,
especially adapted for the Asian market, in
order to reach a greater part of the public.
Cell Phone Explosion ERICSSoN ARE GETTING INTo NEW oPERATIoNSDuring our visit to Ericsson’s head office in India, located in Gurgaon outside New Delhi, we
were told about the company’s new innovative strategies. Below, you will find the interesting
background to this.
To evaluate a certain operation in a company, one can use Michael Corbett’s core competence
activity test and answer the following questions:
- If starting the operation today, would you do it yourself?
- Would other companies hire you to do the operation for them?
- Will a future CEO come from the department that runs the operation?
If the answer to any of the questions is no, it might be profitable for the company to outsource
this part of the business. It could benefit the company as it then can focus on its core activities,
with increasing revenue, decreasing costs and decreasing risks as a result.
Many cellular operators are struggling to manage their networks optimally. The purchasing of
new base-stations is very costly and the process for running them is difficult. Ericsson is there-
fore not only selling equipment for mobile stations, but they have also started to run their own
mobile networks. Cellular operators can rent Ericsson’s net and thereby focus on the customer
care, marketing, sales and branding. Ericsson believes that it can operate the network better as
it has the knowledge and the possibility of running more then one operator on a platform.
India’s largest operator, Bharti (Airtel), with 26% of the market, is hosting Ericsson’s network. “We
have increased the performance for Bharti, for example, the drop call rate is significantly less
today than previously” (Kjell Casenberg, General Manager).
Cellular subscribers in India(Statistical Outline of India, TATA)
0
10
20
30
40
50
60
2002 2003 2004 2005
2 million new subscribers/month
Telecom Industry
© Project India 2005
PRojECT INDIA 2005 -
In this sector India is one of the most
prominent global players. Technology is the
fastest growing segment of the Indian indus-
try, both in terms of production and exports.
In India, the electronics industry is totally
deregulated, except for aerospace and defense
electronics. As a step in the liberalization
of foreign investments, import-export and
export policies of the entire economy, this
sector is attracting considerable interest not
only as a huge market, but also as a potential
production base for international companies.
Offshoring is often associated with software
development, but it actually ranges from gen-
eral maintenance and other IT-enabled services
like call centers and back-office work.
Developing the systems and solutions of tomorrow, within areassuch as defense, aviation and space, takes advanced knowledge insome of technology’s most sophisticated areas.
Saab is one of a few companies in the world that have what it takes – that’s competence and capabilities in for instance systemsintegration, data fusion, simulation and sensor technology – to meet these challenges at the absolute forefront of technology.
Today we supply leading-edge solutions for air-, land-, and sea applications. We also develop advanced space technology, and weco-operate with the world’s leading aviation industry.
If you’d like to know more,please visit us at www.saab.se
At the forefront of technology.
IND
US
TR
I
SAAB127 Annons KTH 05-09-14 13.55 Sida 1
Visiting Capgemini gave us a great opportunity to look at the consultancy industry and get an insight into the important role India plays for the growth within this sector and how the business culture differs between India and Europe. Capgemini emphasized that one of their aims when they started their outsourcing business in India in 1997 was “rightshoring” – their own term for offshoring. There is a possibility for them to reduce the consultancy and development costs for European and US clients. The growth of Capgemini India became clear to us when we entered the office and met a lot of young people waiting for their first interview. The recruitment process is hard to pass. Out of the 300 people that come to an interview session, 50 pass the theoretical test and go on to an individual interview. 10 people are finally selected.
“Growth is everything for the IT companies.”
Kent Kærby Hansen,Danish Integrator, Capgemini
ECoNoMY
India’s Specialty
IT
© Project India 2005
Developing the systems and solutions of tomorrow, within areassuch as defense, aviation and space, takes advanced knowledge insome of technology’s most sophisticated areas.
Saab is one of a few companies in the world that have what it takes – that’s competence and capabilities in for instance systemsintegration, data fusion, simulation and sensor technology – to meet these challenges at the absolute forefront of technology.
Today we supply leading-edge solutions for air-, land-, and sea applications. We also develop advanced space technology, and weco-operate with the world’s leading aviation industry.
If you’d like to know more,please visit us at www.saab.se
At the forefront of technology.
IND
US
TR
I
SAAB127 Annons KTH 05-09-14 13.55 Sida 1
�0 © Project India 2005
PRojECT INDIA 2005 -
31© Project India 2005
4.2 Million New Motorcycles a Year
In India, cars are still an extravagance. It
is, however, a luxury that a growing number
of Indians can afford. India is not far away
from being among the top 10 automobile pro-
ducing countries in the world and it is set to
become a global outsourcing hub for the auto
component industry. The industry is expected
to grow five-fold over the next 10 years.
The total automobile sales in India have
grown from 5 million units in the year 2000
to 7.5 million in 2004. Tata is currently
designing a new car for the public that they
will start to manufacture in 2008. The price
will be INR 100,000, which is SEK 18,000.
Motorcycle sales have grown most dramati-
cally with a 100% increase during the same
period - last year 4.2 million motorcycles
were sold (Statistical Outline of India, Tata).
On the streets of the cities and in the coun-
tryside, one can see motorcycles everywhere.
You often notice a man driving, his wife and
a child behind, and yet another child on the
handlebars.
Visiting Volvo in Bangalore, we learned
more about the challenges for a high quality
brand in a very price focused market. Volvo is
the first brand in India that is focusing on high
quality and technically advanced buses and
trucks. This is, in some respects, a challenge:
Volvo faces a market where competitors as
well as customers are fixated with the lowest
price instead of quality. Volvo has therefore
worked hard to change the attitude of its
potential customers. By emphasizing a total
cost perspective when selling the Volvo, cus-
tomers have started to realize the advantages
of cost savings by way of operational reliabil-
ity when investing in a more expensive truck.
Volvo has experienced that its customers in
the Indian market are more loyal than in other
markets. This can be explained by the low
number of customers in the market, and that
they do not have much competition within
the premium customer segment. However, the
dominant manufactures of buses and trucks in
India, Tata and Ashok Leyland, with 99% of
the market, are also learning from Volvo and
starting to produce more advanced vehicles.
Vehicles
“TATA is currently constructing a new car for the price of 18 000 SEK.”
ECoNoMY
�0 © Project India 2005 31© Project India 2005
No SIR, IT’S A VoLVo RICKSHAW
Late in the night after a long dinner, we were tired and eager to get back to our hotel. We were up in Oota, a small village in the mountains south of Bangalore. There we were struggling to find a rickshaw that could drive us to the hotel. Finally, we found one and asked the driver for the price. “120 rupees, Sir”, said the driver, which we knew was an exorbitant price. Sick and tired of always getting “taken for a ride”, but too exhausted to negotiate, we agreed anyway. The rickshaw we now were sitting in had blinkers, new seats and some instruments you normally do not see –a bit more chic than usually. “Well, at least it’s a very fine rickshaw you have, is it new?”, Harald asked the driver. “No Sir, my rickshaw is not new”, the driver answered. He then turned around and smiled proudly. “But it’s a very special rickshaw, Sir, this is a VOLVO rickshaw!”
In India, Volvo is more than just cars, trucks and buses, it has, in fact, become a word meaning “very comfortable vehicle” – a standard for comfort and security.
��© Project India 2005Together we make companies and countries grow.
Swedfund – your ideal investment partner for doing
business in India.
Get in touch with us for an informal discussionabout your business idea.
www.swedfund.seTel. +46 8 725 94 00
��© Project India 2005
The textile industry is an important sec-
tor of the Indian market. Today the industry
employs 8% of the population, which cor-
responds to 88 million people. The value of
India’s exported textiles and ready-made gar-
ments is approximately USD 13 billion, which
makes it one of India’s largest foreign exchange
earners. Moreover, the government expects it
to increase to USD 45 billion by 2010 (Dagens
Industri, February 21, 2005). One reason for
this expected massive growth is that the quota
system that has regulated international textile
trade since the 1960s has been systematically
phased out and India as well as China are
expected to benefit from this.
China is the apparel industry leader, but
India is emerging as the most competitive
actor in the home textile business market.
Moreover, while India is focusing on produc-
ing textiles with patterns, China is usually
focusing more on mass production of cheaper
textiles (Kurt Hellström). In the Indian textile
industry, international ownership is still regu-
lated by the government, but many think that
this will change soon.
SWEDISH INDISKA IN INDIA
Project India 2005 had the opportunity to visit Indiska, the well-known Swedish clothing and furnishing company, in Delhi and in Mumbai.
Indiska has been operating in the textile market for many years. During this time the company has learned the market and knows exactly how to operate in it. We were espe-cially impressed by their supply chain management and distribution system in a market that is difficult to control. As the clothing market is extremely trend sensitive, there is no room for delays or any miscommunication between the suppliers and Indiska. The whole business relationship is based on trust between Indiska’s division in India and the 60 or so suppliers, of which most have done business with Indiska for 15-20 years. The company has a distribution hub in the port of Mumbai where they receive all the goods before shipping them to Sweden. At this hub, Indiska price-mark and sort all items into boxes, specifically containing the orders from every shop in Scandinavia. The idea is that the boxes can be sent to the shops without needing to repack them in Sweden, where the garments can be hung up at once.
We also had the opportunity to see different quality check-up procedures and learn about the different inspections that the suppliers have to pass. The management also told us about different action taken to prevent problems such as child labor and to improve the suppliers’ working environment. Not only are Indiska’s suppliers inspected, but the suppliers’ suppliers as well.
Textile Industry
Together we make companies and countries grow.
Swedfund – your ideal investment partner for doing
business in India.
Get in touch with us for an informal discussionabout your business idea.
www.swedfund.seTel. +46 8 725 94 00
The old Cash Cow
�� © Project India 2005
PRojECT INDIA 2005 -
��© Project India 2005
The engineering industry is a large segment
of the overall Indian industry. Essentially, it
can be divided in two segments – electrical
and non-electrical. The electrical industry is
related to investments in the power industry,
while the non-electrical segment is driven by
general industrial investments.
Overall, there is a demand for engineering
equipment in industries like cement, steel,
power and chemicals. Domestic Indian com-
panies are able to manufacture enough for
most of the Indian customers’ needs. We had
the opportunity to visit India’s biggest engi-
neering company, L&T, and saw their heavy
engineering shop and switcher manufacturing.
Most of L&T’s customers are domestic, but,
in recent years, it has made a successful mark
on the international market. However, the
domestic trade is big enough for most Indian
engineering companies. (See also the chapter
Indian Giants.)
Atlas Copco was one of the first Swedish
companies to enter India. Most of them, for
example, Atlas Copco, Sandvik, SKF and Seco
Tools are located in Pune, outside Mumbai.
Atlas Copco has been operating in India since
the 1950s. Last year, it increased its sales in
the country by 30% and it expects this to
continue.
EngineeringThe Largest Segment in the Indian Industry
A hard working welder in Volvo’s factory in Bangalore.
ECoNoMY
�� © Project India 2005 ��© Project India 2005
THE SWEDISH STREET
In Pune, along the street called Sveanagar, which means “The Swedish street”, Atlas Copco is for historical reasons situated next to companies like Sandvik, Tetra Pak, SKF and Alfa Laval. Atlas Copco has been in India since the 1950s and today Atlas Copco (India) Ltd. has about 1,000 employees and has had a very rapid growth in the last two years. From 2002 to 2004 the turnover in India increased from INR 2.5 billion to INR 4 billion. About 50% of the revenue is generated from compressors, 42% from construction and mining and the rest (8%) is generated when selling industrial tools to the automobile industry. The Managing Director, Phillip M. Davidson at Atlas Copco India, gave us the opportunity to learn more about operations in India, difficulties that may occur while operating in India and also some key success factors. The good English skills of the university educated CAD-design staff were important and made it easy to get a better picture of what it is like to work online for demanding customers on the other side of the world.
�6 © Project India 2005
PRojECT INDIA 2005 -
�7© Project India 2005
“Biotechnology will be the next IT in
India” (Beng Johansson, Swedish Trade).
The chemical industry is one of the rapidly
growing sectors of the Indian industry. Within
this sector, the pharmaceutical industry is the
fastest growing. In terms of numbers of drug
patent applications, India is second after the
US but ahead of Germany. At a meeting at the
Indian Embassy in Stockholm, we were told
that the Indian economy soon would be just
as much biotech as IT. The two industries are
comparable: both require a high level of well-
educated people in the work force. India’s rich
human capital may be the strongest asset for
the knowledge-based biotech industry. They
have a large English speaking population and
a pool of over 300,000 bioscience and engi-
neering students that graduate each year.
This summer, Kirin Mazumdar-Shaw,
owner of the largest Indian biotech company
Biocon and India’s richest woman visited
Sweden. In India, she is called the “Mother
of Invention”. She started her business in a
cellar in Bangalore. Today, Biocon develops
and makes medicines for cancer, cholesterol
blockers, insulin and other products for clini-
cal tests.
“Biotechnology will be the next IT in India”Bengt Johansson, Swedish trade.
biotech and Chemicals The New IT
ECoNoMY
All pictures from Astra Zeneca’s production plant in Bangalore.
�6 © Project India 2005 �7© Project India 2005
THE bIG SCARY MARKET
TubERCuLoSIS
While visiting Bangalore we had the opportunity to explore Astra Zeneca’s impressive research facility. The unit was estab-lished in an effort to combat a disease affecting about one third of the world’s population. According to the World Health Organization (WHO), tuberculosis (TB) is the single leading cause of death from infectious disease worldwide, with someone in the world being newly infected every second. The disease varies, however, between two distinct modes: one active and one latent: the former being lethal. Every year, about 8 million new cases of active TB are discovered in the world, with India constituting about a third of these figures. In 2003, nearly 1.8 million people died of the disease worldwide, mainly in combina-tion with HIV.
The drug against TB, which was made available over 40 years ago, must be taken for a period of 6 months. The Indian Government has implemented a plan against TB, resulting in free treatment for the population. However, since patients already start to feel better after two months, they tend to abandon the treatment at that point. What is more, the drug supply is unreliable in some regions in the country. In addition to producing a large number of cases of relapse, this is also the main cause of the rising number of new cases of multi-drug resistant TB. Shortening the duration of therapy (to about 4 months) to improve patient compliance is one of the main aims of Astra Zeneca’s research in Bangalore. Eradicating the disease completely, even the latent disease in order to reduce the chances of relapse, is yet another goal in India.
�� ��
HISToRY of ouTSouRCING
India first saw the emergence of outsourc-
ing in the field of IT in the early and mid
1990s. One of the first outsourced services
was medical transcription. The introduction
of the New Telecom Policy in 1999, which
brought about a drastic reduction in telecom-
munication costs in India heralded the golden
era for the BPO industry and ushered in a slew
of inbound/outbound call centres and data
processing centres.
WHY ouTSouRCE To INDIA?
The past few decades have proved that
India is a most reputed and famous country for
outsourcing. 82% of the US companies ranked
India as their first choice for IT outsourcing.
The majority of outsourcing contracts are
moving to India, despite the fact that coun-
tries like China or Russia are offering better
rates. The chief reason is the availability of a
large pool of IT and engineering talent and a
huge skilled workforce, at very competitive
costs. The dollar goes a long way in India and
companies in the USA are saving billions of
dollars by shipping out non-core functions.
“Indians are good at brain works, ana-
lytical, logical and arithmetical skills. The
growing Indian diaspora has been creating
an impression among international commu-
nity that Indians are good at intellect-driven
skills,” said Chandu Nair, president, Scope
e-Knowledge Centre, a Chennai-based KPO
firm.
“The reason behind India emerging as a
world leader in the KPO sector in the next
few years is due to its location attractiveness,
infrastructure, communication, country risk,
foreign direct investment (FDI) incentives,
political environment and time zone attrac-
tiveness”, pointed out Evalueserve.
Other reasons why India is reputed for
outsourcing are that it is a talent-rich country,
exports software to 95 countries around the
world, enjoys the confidence of global corpo-
rations, offers multiple advantages, has state-
of-the-art technologies for total solutions, IT
is a major thrust area for the Government of
India, has a stable government and is one of
the world’s 10 fastest-growing economies.
SERVICES ouTSouRCED IN INDIA
India currently provides outsourcing for
a wide range of services. The major catego-
ries of services offered are: IT Services, Data
Entry, Programming, Call centres, Business
Process Outsourcing (BPO), Back-Office
Operations, Infrastructure, Communications
and Networking, Media and Entertainment,
Web Development Services, Operations,
Relationship Management, Community
Management, Medical Transcription, and
On-site services. The evolution and maturity
of the Indian BPO sector has given birth to yet
another wave in the global outsourcing scene:
KPO or Knowledge Process Outsourcing.
TRENDS IN ouTSouRCING IN INDIA
Outsourcing in India is undergoing a radi-
cal transformation. The constantly growing
BPO industry in the country is changing,
incorporating new ideas and mindsets as well
as opening up new possibilities for global
companies. Some of the new trends in out-
sourcing are: E-governance, Retail Services
Outsourcing, Pharmaceutical Research,
Financial Services, Health Care, and most
important of all, KPO.
Outsourcing trends
ouTSouRCED ARTICLE
�� ��
TuRNoVER of bPo AND KPo IN INDIA
The table below shows the past, current
and forecasted figures of the BPO industry in
India.
According to a report by GlobalSourcing-
Now, the Global Knowledge Process Out-
sourcing industry (KPO) is expected to reach
USD 17 billion by 2010, of which USD 12
billion would be outsourced to India.
Evalueserve, a knowledge services com-
pany providing worldwide business and
market research, data analysis for various sec-
tors say: “India will garner a whopping 71%
of the projected $17 billion KPO market by
2010 i.e. $12 billion”
Many other Asian countries have now
begun to provide outsourcing services to the
world. Countries such as China, Philippines,
Sri Lanka, Vietnam, Malaysia and Singapore,
are some which have emerged in this trade.
REVENuE \ YEAR 2002 200� 200� 200� 2006 2007 CAGR
offSHoRE bPo REVENuE 1,322 1,825 3,017 6,��� 12,563 2�,2�0 78.91
INDIAN bPo REVENuE 912 1,205 1,961 �,�2� 7,412 13,811 6�.��
TOTAL BPO MARKET 110,167 121,687 131,171 143,090 157,033 173,070 �.��
CAGR IN % 2002-07 fIGuRES IN $ MILLIoN SouRCE: GARTNER DATAquEST (MAY 2003)
Brainpower at the KPO company Evalueserve.
ouTSouRCED ARTICLE
�0 © Project India 2005
PRojECT INDIA 2005 -
41© Project India 2005
How to Outsource Outsourcing
Who wrote the previous article? Not us.
In order to investigate the outsourcing
business, we decided to outsource the
article above to the company Conve-
nient.info based in Sri Lanka. They offer
research and report writing for prices far
lower than in Sweden. We wanted to ex-
amine the following: How complicated is
it to order services from the other side of
the world? What are the drawbacks due
to the distance? Will the result be as one
expects or totally different?
The process was surprisingly simple. First,
we contacted Convenient and opened an
account at their homepage. All contact with
the company takes place over the Internet,
you order services at the homepage and whilst
the work is being done you can correspond
via e-mail if need be. When placing a new
order, one writes a description of the project,
specifies the time the researcher should spend
on the work and finally chooses the format
for the product, e.g., Word document, Power
Point presentation etc.
Outsourcing is not without complications.
Before ordering a service from the other side
of the world, you must be absolutely clear
about how you want the result. Due to the
distance, time differences and sometimes lan-
guage barriers, it is often quite difficult to have
a continuous dialogue with the people doing
the job. Working on a project or product
often means constant development – it may be
unclear how one wants the end result to be.
When outsourcing it is difficult to control this
development process.
We spent a lot of effort describing what the
article should include. To get the feeling that
the text was written by us, we wrote down
some of the experiences we had had in India.
We also attached some interesting articles and
good homepages for the subject. It is not easy
to follow the process. We got one mail from
Zainab, our researcher in Sri Lanka, where
she asked for permission to write a longer
article. About two weeks after we had placed
the order, the work was finished. In the specifi-
cations, we had given the researchers 20 hours
for the work. However, they only needed 10
hours and consequently we just had to pay
575 SEK for the work. We are satisfied with
the result and find the whole experience very
convenient.
A Convinient Way of Work
“However, they only needed 10 hours and consequently we just had to pay 575 SEK for the work.”
ECoNoMY
�0 © Project India 2005 41© Project India 2005
WHY HAS INDIA THE PoTENTIAL To bE THE ouTSouRCING CouNTRY of THE WoRLD?
Some answers are discussed below.
India has a huge work force; companies can fast employ thousands of
people.
The country has a huge population of well-educated people. Traditionally,
an education is considered as very important.
India has many engineers, of which many specialize in mathematics, IT and
logic.
Language; most people speak good English.
Many Indians have worked abroad and learned the global way of business
thinking.
India’s success in the less capital-intensive business-service-outsourcing
sector, compared to China that has invested more in heavy industry and
manufacturing, is partly a result of India’s economy, which has been less
able to finance investments and accumulate physical capital, including
infrastructure, machinery and buildings (McKinseyQuarterly, 2005).
During our visits to Capgemini, IBM and Evalueserve we had a first-hand look at the outsourcing sector and its highly skilled people. The companies are expanding massively. When walking around at Evalueserve, for example, one sees huge areas with new desks and computers being prepared for new employees. “I offer all of you guys a job or internship here at Evalueserve”, said Ashish Gupta, Country Head and COO, at a meeting. It is rumored that this year IBM is employing around 1,000 new consultants a month in India.
Welcome to the world of Atlas Copco!
Innovation is at the heart of everything we do. It shapes our ideas, it drives our production processes and it has driven us to develop completely new applications and markets. The knowledge and experience we gain from applications around the world is channeled back to our engineering teams who conceptualize, develop and fine-tune products to perfection. Through the years we have taken new and innovative solutions and transformed them into profit-generating business tools, helping our customers to maximize their productivity. Sounds interesting?
Find out more at www.atlascopco.com
AtlasCopco_ad.indd 1 2005-09-22 14:22:49
For Demanding People
Dessa motorer ska till andra
sidan jorden. Du kan komma
ännu längre.
På www.scania.se visar vi Scanias offensiva,
expansiva och globala värld med dess möjligheter
för unga akademiker.
Du kommer bl a att upptäcka att vår affär är
långt mycket större än att utveckla och produ-
cera tunga fordon. Scania är ett högteknologiskt,
utvecklings intensivt och marknads orienterat
företag, som med avancerad ny teknik ständigt
skapar mer kunskapsbaserade fordon, intelligenta
serviceprodukter och fi nansieringslösningar.
Scanias framgång är till stor del resultatet av
ständig utveckling av våra medarbetare, produk-
ter, metoder och marknader. Vi ger dig utmaning-
ar och möjlig heter till personlig utveckling.
Scania är en av världens ledande tillverkare
av lastbilar och bussar för tunga transporter samt
industri- och marinmotorer. En växande del av
verksamheten utgörs av produkter och tjänster
inom service och fi nansiering, som garanterar
Scanias kunder kostnadseffektiva transportlös-
ningar och hög tillgänglighet. Scania är verksamt
i ett hundratal länder och har 30 000 anställda.
Forskning och utveckling är koncentrerad till
Sverige. Tillverkning sker i Europa och Syd-
amerika med möjlighet till globalt utbyte av såväl
komponenter som kompletta fordon. Under 2004
uppgick faktureringen till 56,7 miljarder kronor
och resultatet efter skatt till 4,1 miljarder kronor.
�� © Project India 2005
PRojECT INDIA 2005 -
��© Project India 2005
Even if agriculture is extensive in India,
most of the income from export comes
from the industry sector - where textile
and the refining of different types of metal
and mineral represent a large part. In the
industry sector, foreign companies are
making inroads but domestic companies
are still dominating the Indian market.
Some of these companies are truly mas-
sive and tend to operate in nearly every
business sector. For example, Tata, the
largest company in India, manufactures
anything you can imagine: electronics,
cars and trucks, tools and owns more
or less entire villages with schools and
factories. They also operate in nuclear
research, chemistry, energy, mobile net-
works, hotels and IT etc. It is omnipres-
ent!
Another one of these giant companies
that Project India 2005 had the opportunity
to visit in Mumbai was Larsen & Toubro. It
manufactures, for example, aerospace equip-
ment, cement machinery, control and automa-
tion equipment, defense equipment, petrol
pumps, medical equipment, switchers, and
much more.
One may ask why many Indian compa-
nies tend to operate in such wide fields of
operations, when western companies have
a tendency to limit their organization to a
few main activities. The answer might be
found in India’s history. When India became
independent in 1947, there was a small range
of domestic industries. The strategy was
to achieve self-sufficiency and the market
was totally controlled by the government.
Therefore, the social democratic system did
not allow the industry to purchase from
abroad and, consequently, the Indian compa-
nies had to fill all the gaps in the market. “We
were also limited by the policies – we were
not allowed to sell as much as we could have.
So, to be able to expand, we had to get into
new business areas”, explained M. K. Patki,
General Manager at L&T.
Recently, India has put itself on the map
when it comes to software and the IT services
industry. Programming and systems develop-
ment seem to suit the Indian way of thinking.
Larger than Life
The Indian Giants
The big Indian companies have a strategy to be represented in many different markets. Reliance and TATA are two of them.
ECoNoMY
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This industry has grown rapidly over the last
years. Infosys, Tata and Wipro are the largest
IT consultancy companies in India and they
have begun to gain market shares in the com-
petition with other global actors.
TATA
The Tata Group comprises 91 operating
companies in seven business sectors: informa-
tion systems and communications; engineer-
ing; materials; services; energy; consumer
products and chemicals. The Tata Group is
one of India’s largest and most respected busi-
ness corporations, with revenues in 2003-04
of USD 14.25 billion, the equivalent of about
2.6 % of the country’s GDP. Tata-owned com-
panies employ together over 220,000 people.
The Group’s 32 publicly listed enterprises
— among them names such as Tata Steel, Tata
Consultancy Services, Tata Motors and Tata
Tea stand out — have the highest combined
market capitalization among Indian busi-
nesses in the private sector. The Tata Group
has operations in more than 40 countries
across six continents, and its companies
export products and services to 140 nations.
Tata Consulting Services (TCS) has currently
120 persons working in Sweden.
INfoSYS
Infosys Technologies Ltd. provides con-
sulting and IT services to clients globally
- as partners for conceptualizing and realizing
technology-driven business transformation
initiatives. They have over 36,000 employees
worldwide.
As one of the pioneers in strategic offshore
outsourcing of software services, Infosys
has “bucked” the global trend of offshore
outsourcing. Although many software out-
sourcing companies are blamed for diverting
global jobs to cheaper offshore outsourcing
destinations like India and China, Infosys was
recently applauded by Wired Magazine for
its unique offshore outsourcing strategy — it
singled out Infosys for turning the outsourc-
ing myth around and bringing jobs back to
the US.
WIPRO
Wipro provides consulting and IT services
as well as product design, employing over
42,000 people worldwide. They represent the
fourth largest company in the world in terms
of market capitalization of IT services. As the
second largest Indian IT consultancy firm in
Sweden, they have identified Scandinavia as
one of the most important markets in order to
establish themselves in Europe.
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© Project India 2005
The Backside of India’s Economic Boom
The famous Indian writer, Arundhati Roy,
warned the world of the consequences
of the economic boom in India in an in-
terview with Reuters. “India’s economic
boom is causing unsustainable environ-
mental damage and is blinding people
to the misery of hundreds of millions of
poor”. Arundhati is a leading environmen-
tal activist in India. She became world fa-
mous in 1997 for her novel “The God of
Small Things”, known in Swedish as “Små
tingens gud”.
India is on everybody’s lips nowadays. All
global companies are considering India as a
potential market and they want a part of the
boom. “It is almost as if the light is shining so
brightly that you do not notice the darkness”,
Arundhati argues. She means that the Indian
environment is seriously threatened – on the
verge of a disaster – caused by pollution from
the big industries and problems with the huge
dumps.
In the past, the ground water was mainly
used by private farmers. Today, much of the
water goes to irrigate thirsty cash crops such
as soybeans, peanuts and sugarcane, which is
unsustainable according to Arundhati. The
lack of water in parts of India has forced
millions of farmers to the brink of economic
collapse. “You have to have a system where
people have access to some amount of water
to grow whatever is sustainable for them to
survive”.
Roy says that the dream of consumption
has been sold to the poor – a dream that is
impossible to deliver economically or environ-
mentally. “Are you going to starve to death
dreaming of a cell phone or are you going to
have control of the resources that are avail-
able to you and have been for generations, but
have been taken away so that someone else
can have a cell phone?” She thinks the idea
of turning one billion people into consumers
is terrifying.
Arundhati Roy’s terrifying thought is one
side of the coin. One may also argue that the
economic development in India has helped the
poor. The percentage of the population below
the poverty line has decreased from 54.9%
in 1974 to 27.1% in 2000. Access to new
technology, such as cell phones, has made it
possible, to a greater extent than before, for
people in rural areas to communicate. Even
though the cell phones and call prices are not
affordable for many people in India, they have
the lowest rates in the world.
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Last year 4.2 millions motorcycles were traded in India. Picture taken in Bangalore, one of many citys with hectic traffic.
�6 © Project India 2005© Project India 2005
When visiting the big cities in India, the
pollution is obvious and terrifying. Countless
rickshaws, motorcycles and old cars, most
probably without catalytic converters, crowd
the streets. Annually in India, 4.4 million
motorcycles and 820,000 cars are sold. In the
year 2000, the figures were 2.1 million motor-
cycles and 590,000 cars respectively. “Two
years ago, we had only cycles in the employ-
ees’ parking spots. Today, however, there are
many motorcycles and some cars”(Thierry
Cros, Managing Director Seco Tools). This
trend will probably continue. Tata recently
revealed that it soon would be manufacturing
a car for the public that would only cost SEK
18,000.
The impression that we got, when visit-
ing the companies, was that they paid a
lot of attention to environmental issues.
Environmental documents, such as ISO cer-
tificates, are highly valued and important for
the companies’ profile. Unfortunately, some
companies that we met complained about the
corruption surrounding these certificates.
Environmental questions are highly
important for fast developing countries, but
sometimes they tend to be overshadowed by
economic success. We believe that Sweden
could support India in these issues. This is also
an interesting area for Swedish companies,
which can export environmental knowledge
and products, for example, water cleaners.
The fast development has dramatically increased the need for new houses in Mumbai.
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© Project India 2005
“The brain rain over India is like a mon-
soon”, explains Ashish Gupta, Country
Head and COO at Evalueserve.
At its office outside Delhi, thousands
of young graduates from the very best
schools in India work with KPO, knowl-
edge process outsourcing. Intensively,
they collect and analyze information for
strategic decisions for companies in Eu-
rope and America, this for a fraction of
what the service would have cost in the
West.
In Sweden, it is generally held that the
ongoing outsourcing trend is a great threat
to our welfare – companies like Evalueserve
are our enemy. This growing fear could be our
greatest threat as it only results in anxiety and
misgivings about the future.
In India, on the other hand, belief in the
future is stronger than ever. They surf on a
wave of self-confidence. Students and busi-
nessmen know that the country has a great
potential to become an economic power. The
financial boom is not without reason: India
has understood the advantages of globaliza-
tion and knows how to gain from it. Students
are extremely competitive and work harder
India - Threat or Possibility
“For over 15 years, the Swed-ish growth in GDP has been less than in India and most other non-European coun-tries.”
Earlier it was considered that Indian made products were of less quality, but today many companies are starting to be more and more proud of the ”Made In India” signature.
��
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than ever. Universities and institutions have
realized the importance of innovative thinking
and encourage the students to become entre-
preneurs. The outsourcing segment has been
a gateway to the global market for India, as
well as other developing countries, and they
consider it as their market.
Has the pendulum swung? Earlier, we were
interested in investing and making purchases
in India – this was seen as welfare, a way of
helping a vulnerable country. Now, when
India is on the way up, we feel threatened
and recoil. We are worried about what is hap-
pening in Asia and how it will impact on our
welfare.
European conservatism and our skepticism
about globalization are damaging. For over
15 years, Sweden’s GDP growth has been less
than in India and most other non-European
countries. Sweden has many impressive indus-
tries and companies like Ikea, H&M, Atlas
Copco and Ericsson, but, on reflection, all
these companies are old. Our market is totally
dependent on big industries that started a hun-
dred years back. We cannot rely on them sup-
plying the Swedish people with work forever,
and it will not be the case. Sweden must focus
on creating new jobs rather than protecting
the old ones. The “lay-back-and-do-nothing”
mentality in Sweden is set to fail. Instead of
counteracting the natural globalization, we
must learn the dynamics and use it.
By staying a part of the globalization race
and understanding the developing countries’
potential, both Sweden and these countries
will gain – it is a win-win situation. By
outsourcing services, such as patent filing,
accounting or book keeping, Swedish small
and medium-sized companies may focus on
their main activities and develop products
that are globally competitive. Globalization
also opens up a growing market, which also
Swedish manufacturing can benefit from. For
example, 50% of Seco Tools products sold
in India are made in Sweden. Before starting
its factory in Pune, Seco Tools did not sell
anything in the Indian market. Moreover, an
increasing number of decent paid jobs in the
developing countries contribute to the global
purchasing power, which will support Swedish
production.
The outsourcing hysteria is exaggerated.
In an interview with Kurt Hellström, former
CEO of Ericsson, he explained that he is not
worried about China or India taking over the
world. China has a dictatorship, which is a
danger in the future. What will happen if a
revolution comes? Kurt Hellström explained
that the lack of laws against plagiarism also
restricted their research and development
industry, and, In India, the infrastructure and
bureaucracy were a major problem, which
delayed development.
As discussed earlier in this chapter, out-
“For every order Seco Tools delivers we purchase raw material from Sweden. The global expansion is therefore not a threat to Sweden, it is a necessity.”Thierry CrosManaging Director, SECO TOOLS
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sourcing is a complicated business. Many
companies focus too much on the savings and
forget the importance of close service rela-
tions. It is also important to keep a close link
between production and R&D. Consequently,
a great deal of manufacturing cannot be
relocated. By focusing on the manufacturing
sectors, where salaries mean less but service
and customer adjustments more, Sweden can
continue with a profitable production. Scania,
for example, is a moneymaking company with
a lot of production in Sweden. This may be
the right strategy when there is a low correla-
tion between work costs and product prices.
We must learn from India. The amount of
company owners among the Swedish work-
force is today lower then ever with only 7%.
In spite of deregulation and a rising number
of contracts from the public sector, Sweden
has lost 30,000 companies (net) since 1995
(Confederation of Swedish Enterprise, June 6,
2004). Since the recent downturn in the econ-
omy, many Swedish students are pessimistic
about the future. Many count on being unem-
ployed for a year after graduation. Sweden
has many first class universities. As in India,
they should support and help the students to
become entrepreneurs. The universities and
the private sector should have a closer rela-
tionship – this would help creative students to
turn their ideas into reality. To keep Swedish
research on a globally competitive level,
we must improve our education right from
the first grade, i.e., the first year at primary
school. And India can teach us how children
enjoy learning. We should use our world lead-
ing skills regarding environmental products,
project management and social structures.
But, most of all, we must be more optimistic
about the future; we should surf on a wave of
self-confidence, like in India.
“From India, we can be taught how children enjoy learn-ing.”
“The Swedes are excellent at managing busi-ness, and the Indians are good at manag-ing life. Both can gain from a more intensive collaboration.”Narendra TanejaCorrespondant for the Scandinavian business papers DAGENS INDUSTRI and DAGENS NARINGSLIV
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START-UPSADVANTAGES AND CHALLENGES
PRojECT INDIA 2005 STARTS A CoMPANY!oTHER SWEDES IN INDIA
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Start-Ups
India is one the world’s most promising
markets for technology. The real issue for
the coming decade is not whether Indian
workers will steal our high-tech jobs: it is
whether their high-tech consumers will
still buy our products. People in the West
often consider themselves the world’s
leaders in innovation while developing
countries like India can only aspire to
unglamorous jobs that require less brain-
power or entrepreneurial expertise. Here
lies the main misconception. Many start-
ups can gain a great deal from the innova-
tive forces of today’s Indian market.
In order to really understand the Indian
market, a company needs to realize its advan-
tages, challenges and learn from former suc-
cessful start-ups in this country. Before estab-
lishing operations in this part of the world,
one must truly observe the environment, the
culture and act accordingly. Several compa-
nies have committed genuine mistakes in the
past, as exemplified here in this document. By
sharing these and providing you with tips and
knowledge about entrepreneurship in India,
we hope that this document can help as a
guideline for encouraging a start-up in India.
The first step is therefore to analyze the
opportunities that exist in this vast country.
Then we will proceed by identifying the major
challenges that companies might have to face.
Giving you a practical example of a start-up
in detail will allow you to gain a good under-
standing of what it takes to perform these
kinds of activities. Finally, we will examine
the road to success for several large global
companies who are now well established in
the Indian market.
ADVANTAGES
The major advantage of the Indian mar-
ket is the combination of low labor costs
and high level of education. India produces
over 300,000 new engineers every year. The
fact that these engineers are ready to work
for almost one tenth of the salary paid to an
engineer performing the same job in the West
makes India a very attractive market for relo-
cating production. Cap Gemini, for example,
pays an employee with seven years’ experi-
ence and a Masters degree from a university, a
yearly salary of INR 200,000, which is about
USD 4,200 a year. Differences in the level of
education, however, do exist. Among the new
graduates, only 10% of them demonstrate
excellent skills while 60% are like the average
in Western countries and the rest are at a below
average level (Atlas Copco). This raises the
question as to where and how you might find
the best-qualified personnel. Students graduat-
ing from one of the seven existing IITs (Indian
Institute of Technology) in India or the IIMs
(Indian Institute of Management) are the most
talented. Students from these universities are
“India produces over 300 000 new engineers every year.”
START-UPS
Advantages and Challenges
�2 © Project India 2005 ��© Project India 2005
Mumbai, the center for economics and Bollywood dreams, is often seen as the place where your dreams can be fulfilled.
�� © Project India 2005
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��© Project India 2005
therefore quickly drafted by companies who
are hiring new staff. There is another element
that differentiates the employees in India from
Europe. In India, they tend to have a more
positive approach to training. Therry Cros,
CEO of SECO Tools India, confirmed this
saying “There is a greater will to learn”, and
pointed out the language skills of his staff.
While visiting the Indian company
Evalueserve in New Delhi, we realized that
their highly motivated staff look upon long
working hours positively. The competitive
atmosphere among the staff was clear and is
probably one of the contributing factors to
these employees being hard working.
“As Silicon Valley developed over time”,
says Mike Moritz, venture capitalist at Sequoia
Capital, “it attracted more skilled people and
then more good things happened. The same
will happen for India”. To further prove this
point, the Silicon Valley Bank, which mainly
lends to high-tech start-ups, has recently
opened a branch in Bangalore.
“Globalization in general is to move pro-
duction where the production costs are the
lowest”, as confirmed by Philip M. Davidson,
the CEO of Atlas Copco India. During our
stay in Bangalore we heard rumors that
IBM, for example, was hiring at a rate of one
thousand new employees per month, which
shows the impact that the market has on
global companies. Further, the rent costs and
the cost of material from local suppliers are
much less. For global companies, however, the
notion of moving production is not enough.
Small companies can use this as an advantage
in order to lower production costs. The global
companies also see India as a new emerging
market. With a population of over one billion
people, India represents a large purchasing
power. For example, there are 2 million new
cell phone subscribers per month - a figure
that cannot be ignored. Knowing this, most
large companies establishing themselves in
India not only produce their products there,
but also sell them to the Indian market. The
“Globalization in general, is to move production to where the production costs are the lowest”Philip M. Davidson, MD Atlas Copco India
A ferry taking people from Wipin Island to Ernakulam city in Kerela.
�� © Project India 2005 ��© Project India 2005
fact that most Indians can communicate in
English, which is the main business language
globally, is yet another bonus.
Being the world’s largest democracy (as
opposed to China), the Indian Government
allows the start-ups to be independent of an
Indian partner if they wish to proceed in that
way. The possibility of having a fully owned
business gives these companies more control
and power to become involved.
Start-ups in India have yet another pur-
pose. By establishing themselves in India, the
mere presence in this part of the world pro-
vides them with an opening into the rest of
eastern Asia and several new markets.
CHALLENGES
As said before, having a good understand-
ing of the way things work in the Indian
market is crucial in order to have a successful
start-up. Some companies choose a joint ven-
ture; others stay fully owned but hire Indian
staff for administrative purposes (lawyers,
agents). The main advice that almost all the
people interviewed during our trip gave us
was that there is a need to have a local person
or organization who can help, inform and
handle deals with the supplier and bureau-
cratic issues.
The importance of knowing the market
and choosing the right segments is clearly
shown by two examples: Electrolux and
Volvo. Electrolux is seen as the global leader
in home appliances. However, its strategy to
enter the Indian market was not successful.
From 1995 to 2002 the company focused on
a multi-brand strategy, in an effort to reach
different consumer segments. They encoun-
tered numerous problems while signing one
agreement after another with other foreign
companies based in India. They were therefore
not successful in the Indian market. The focus
on brand making is crucial in India. Being a
global giant, you need to prove yourself to be
good value and that your brand is a trusted
“There is a need to have a local person or organisation who can help.”
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name. The market demands that you have
more than just sophistication.
Volvo, on the other hand, has succeeded
with its strategy of producing for the high-end
(niche) segment of the market. The commodity
part of the Indian industrial market is nearly
80%. This segment is largely dominated by
Indian or half-Indian companies who have
already well established themselves and made
a name for their brand (Tata and Maruti
Suzuki for example). By targeting their efforts
at the high-end part of the market Volvo is,
for example, today a quality standard for safe
and comfortable buses.
The low production costs in the Indian
market attract numerous companies that wish
to start up. In teeming cities like Bangalore,
where the majority of the IT companies are
located, these new companies pose a problem
for the others. Not knowing what salary levels
are appropriate or which rent prices for pieces
of land are correct, they tend to pay more than
necessary. The price is still much less than in
the West, but they force others companies to
raise their salaries and put up with rent hikes.
Having a proper knowledge of the business
environment helps therefore not only the new
companies wanting to establish themselves,
but even the ones already based there.
Even though the Indian market abandoned
the economic regulations in 1991, the system
is still far from flawless. The first major issue
is corruption. The average time it takes to
register a company is 10 times that of starting
the production. All the large companies we
met during our stay confirmed the fact that
the national government and the state govern-
ments tend to claim some funding in order to
perform the required activities. Another inter-
esting fact is that, when a company wishes to
proceed with a start-up in India, the different
states compete with each other in order to
convince the company to establish itself there;
this is often in the form of tax relief. The
states in India are independent of each other
and have their own laws, especially taxation
laws. Bureaucracy is therefore an important
issue to consider. Patent registration is one of
the fields, where the lack of correctness in the
bureaucratic organization is clearly visible.
Astra Zeneca is one example, among many,
which is struggling to improve the system.
Other companies we met testified to the lack
of security when handling critical informa-
tion. IBM had difficulties in 1972 and left the
Indian market, one reason being technology
leaks.
There are also numerous physical chal-
lenges in India. The infrastructure in India is
far from optimal. This causes a lot of prob-
lems for the companies’ logistic departments.
Another obstacle is the power supply issue.
Power cuts are very frequent in all major cit-
ies, and the federal government has recently
signed several agreements with the US in
“The average time to register a company is 10 times that of starting the production.”
A travel agency in the heart of Bangalore.
START-UPS
�6 © Project India 2005 �7© Project India 2005
order to make some progress in this field.
Environmental issues are improving in India
with, for example, the ISO certifications.
This is despite the fact that during our stay
people attested to the link between corrupted
environmental and safety inspectors and the
certified facilities.
To have knowledge of the Indian culture,
environment, and the way things actually work
in India is crucial for the company’s develop-
ment. Business ethics are also an important
element to consider. Foreigners arriving in
India sometimes encounter communication
problems. Due to cultural differences, this
aspect requires an effort from both sides.
There are also technical challenges to con-
sider. The Internet connections are far from
the high-speed standard, which we are use to
in the West, and the quality of several phone
lines we tried was poor, even in cities like
Bangalore or Mumbai. Yet another interesting
idea in “business India” is that of a win-win
deal, which simply does not exist. Each side
wishes to gain maximal profits from a deal,
even if it means that one side is left with the
negative consequences.
In the West, it is generally felt that goods
manufactured in India are of inferior quality
to those made in Western countries. Atlas
Copco’s set-up for the Indian market was,
for example, primarily the idea that the pro-
duction made here could not be exported.
Products made in India were never regarded as
consumer goods. A large piece of equipment
made in India could never be seen elsewhere.
But due to a good education system, the way
of looking at products manufactured in India
has changed. This notion is also confirmed by
SECO Tools who have recently launched a
“Made in India” campaign with the message
that products made in this country should
not discourage potential buyers but rather
encourage them. These companies share the
opinion that products made in India are the
same, if not better than those manufactured
in the West. The companies need to convince
consumers that the brand is safe, which means
that the product delivered by the company is
the same, irrespective of the location of the
production. If, for example, you are selling a
SECO Tools product then it will be the same
whether found in India or in France. The idea
is to ensure that you are buying the same prod-
uct, what matters is the brand of the product,
not the manufacturing location. Before even
moving production to India, start-ups need
to be well aware of the impact on consumers
when told that the product actually is manu-
factured in India.
A visit at the Atlas Copco facility gave us an insight in the different steps of the production. The level of automated activities in the production chain is low, since manual labor is still preferred, being more cost-efficient.
“Yet another interesting no-tion in business-India is that of win-win; it simply does not exist.”
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After a lot of pre studies on companies
in India we wanted to experience on our
own what it is like to start up a business
with Indians. As a study, we have chosen
to start a shirt import company called
“Royal Shirts”.
The business idea of Royal Shirts is to
import high quality shirts from India, tailor-
made to the customer’s unique measurements
and for a price of EUR 30 per shirt (including
shipping and delivery costs). Our target group
is mainly students that need to expand their
wardrobe while starting a business career. To
recruit new customers the company will focus
on being present at student events, where a
tailor will take the measurements and the shirt
models/fabrics will be displayed. We do not
believe that the Internet is the right medium
for attracting new customers, but we will use
a web page to handle further orders and client
contacts. The company will be launched at
our project day, the 12th October.
Project India 2005 Starts a Company!A Small Step Closer to understanding the Indian business Culture
START-UPS
�� © Project India 2005 ��© Project India 2005
ouR ExPERIENCE
The language difficulties started to become
a problem when we continued our communi-
cation by phone and e-mail from Sweden. On
one occasion when our contact was asked to
write down an e-mail address, he answered:
“Sorry Sir, I can’t write. It is totally dark here,
power failure”. Also, apart from the electricity
problems, the different pronunciations make it
hard to share important information over the
phone. A simple thing such as exchanging dif-
ficult e-mail addresses through text messages
was of much help. The tailor also e-mailed us
pictures of different fabrics, which were used
in the selection process of the first samples. To
reduce the problem of the envelope sizes being
too large, we tried to package the shirt in a
plastic cover and then used a vacuum cleaner
to suck out the air. This process made the
package thin and stiff like a normal letter. The
real problem was communicating this idea to
the tailor in India. E-mail and phone are good
for information but when it comes to convinc-
ing people, one has to actually be there.
Our company name could have been some-
thing like “Royal Indian Shirts” but the com-
mon Swedish perception of India as a nation
that makes quality products is weak. Maybe
in a few years this will change. Considering
the situation today, our company does not
benefit from a name with an association with
India.
Our overall experience is that India is
closer than we thought; a time difference of
3.5 hours simply gives us some extra hours
in the morning for work. We find our Indian
partner to be enthusiastic, helpful and trust-
worthy. A face-to-face meeting is, however, a
necessity when starting up.
FIVE STEPS TO A START-UP
First, we located a tailor in Bangalore who we trusted and thought had the right skills. At this stage we felt it essential to actually be there and try the products and test the collaboration process, which we had the opportunity to do. The good English skills of the Indians clearly simplified this process.
We contacted the Swedish Trade Council to find out the exact custom fees. One phone call and a quick look at their complex web site was enough to find the custom taxes: 9-12 % depending on the origin of the fabrics. Also an additional value-added tax of 25 % has to be paid on imported goods. Since there might be certain restrictions regarding imported fabrics from Asia, a call to the Swedish National Board of Trade was also necessary.
We then checked out different shipping alternatives. UPS and other similar shipping companies concentrate on expensive short delivery times. The cost of a box (45x30x30cm) weighing 5 kg is approximately EUR 150, with a delivery time of six days. A part of a boat con-tainer, the size of one square meter and weighing 1000 kg, costs EUR 2500, if a four-week delivery time is selected. All these alternatives were much too expensive for our business so we tried to use the regular postal delivery system. We sent some envelopes containing shirts to our tailor and he returned them, and the result was satisfactory. With a delivery time of less than two weeks as well as all packages surviving the trip, this encouraged us to continue. If we send it by mail, the Swedish mail company will impose a tax and will charge about EUR 10 for each package.
We started a test session for volunteers and registered the business with the Swedish Patent and Registration Office.
The final test will be launched at our project day at the Royal Institute of Technology (KTH) on 12th October.
1
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Other Swedes in India
Sweden has exported products to India
for a long time, starting with an Ericsson
switchboard in 1905. Some Swedish com-
panies left the Indian market after huge
failures and some are still waiting for the
right time to enter the market. There now
follows a few examples of successful
Swedish companies that have struggled
to understand and benefit from a start-up
in India.
ATLAS CoPCo
Atlas Copco has been present in India since
1947, entering the market through a joint
venture as several other Swedish companies
did at that time. In the late 1950s, the trend
was to ditch the collaboration strategy and
instead look for your own land.
Atlas Copco’s set-up was primarily for the
Indian market. The attitude was that the pro-
duction made in India could not be exported.
Products made in India were never seen as
consumer goods. Through a good education
system in India, the new engineers changed
this perception however. Atlas Coco has today
fully expanded its business in India - 14 out
of the 15 business segments are now repre-
sented. The future for Atlas Coco in India is
bright due to the industrial development, the
increased investment in the infrastructure and
the growing construction business. The two
main areas are compressor techniques, which
represent 50% and construction and mining
technologies with 48% of the business.
There are examples inside the Atlas Copco
organization of how Swedish factories are
unable to compete with the lower production
costs in India. An air filter made in Sweden
was said to be too complicated and high-tech
to be produced in India. Managing Director,
Phillip M. Davidson, explains how this was an
absurd statement, which the Swedish factory
claimed right to the very end. Atlas Copco is
now about to launch an air filter production
facility in Bangalore only for female workers
with managerial potential.
Atlas Copco Rides on Development
This Atlas Copco worker explains that he has clearly noticed the industrial develop-ment. The amount of work has increased but the salary is still the same.
START-UPS
60 © Project India 2005 61© Project India 2005
Managing Director Phillip M. Davidson explains the compressor technique, one of the core segments of Atlas Copco India.
Today Atlas Copco India has about 1,000 employees and has had a very rapid growth in the past two years. From 2002 to 2004 the turnover in India increased from INR 2.5 billion to INR 4 billion.
Our half-Indian member Viveka, used her skills in Marathi to com-municate with the rarely English speaking operators and mount-ing staff on the factory floor. The discussion gave us some new insights into how the workers have experienced the fast develop-ing industry.
By tradition, no women are working at the factory floor but this is changing. Atlas Copco’s new Air Filter production facility is designed to give women with leadership potential all the necessary experience in production.
The CAD– designers at Atlas Copco are working for global customers with high-tech components. This would not be possible without a good working In-ternet connection. All the drawings are sent by mail and further communication is done by phone.
62 © Project India 2005
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Ericsson works as a provider of network
solutions and services for the Indian telecoms
operators. Ericsson has 43% of the GSM
market and 34% of the wireless market. The
cell phone industry is growing rapidly and the
young population is driving the development.
The pre-paid cards have made it easier to
become a subscriber and a cell phone is now
used in all segments. Today, wireless subscrib-
ers eclipse wire line subscribers in India.
The main operator Bharti, which buys
services from Ericsson, has today 12 million
subscribers and a yearly growth rate of 100%.
India has today a cell phone penetration of
6% and Ericsson forecasts an increase to 500
million subscribers by the year 2015. But the
key element in development is the 3G system
that will be launched in late 2006.
Ericsson established itself in India in 1977
and for the first 15 years the company did not
make any profit in India. Today the investment
has paid off and for a global company such as
Ericsson it is a necessity to be a part of this
future market. Ericsson has established a large
production site for base stations in Jaipur in
the north of India. The main reason for choos-
ing Jaipur was that the state of Rajasthan
(where Jaipur is the capital) gave Ericsson
tax reliefs. The competitiveness between the
different states in India often leads to special
treatment if companies can promise future
investments.
“If we would have chosen a place today,
we would probably have established ourselves
in Bangalore or closer to New Delhi where
all the other IT companies are located”,
explained Kjell Casenberg, General Manager
of Ericsson’s production plant in Jaipur.
Ericsson has a good position in the Indian
telecom network business but the easy acces-
sible areas for building network stations will
soon be exploited. The next step is to expand
their network to areas with a low level of
infrastructure and often without power
networks. This will require new technology
such as smarter communications solutions
for directly connecting calls and automated
network stations.
Other Swedes in IndiaEricsson Connects with India
In the Ericsson boardroom the HR man-ager described the importance of arrang-ing activities for their staff. This is done by reward-programs and activities involving the families of the employees.
“The India school system has got more interaction between students and teachers than the Swedish. After my studies at the S3 department at KTH in 2003, I experienced that it was all about the exams, and not wether you attended the classes or not. I also thought it was strange that no companies were interested in recruiting students, but the economic situation in a de-velop country like India is not fare to compare with”, explains Pankaj Mukhija.
START-UPS
62 © Project India 2005 Requirements-Driven Innovation
ett av världens 10 mest inflytelserikaföretag inom applikationsutveckling*
Telelogic, med huvudkontor i Malmö, har cirka 900 anställda i fler än 20 länder. Vi har utvecklingslab i Sverige USA, Storbritannien och Indien. Besök www.telelogic.com för mer information.
Telelogics utvecklingsverktyg hjälper företag att utveckla de mest innovativa och häpnadsväckande systemen i världen. Med våra verktyg kan företag automatisera hela sin utvecklingsprocess och öka sin konkurrenskraft genom att produkt, system och programvara utvecklas enligt uppsatta mål och kundernas behov. Detta förbättrar kvalitet och förutsägbarhet, samtidigt som utvecklingstid och -kostnader minskas.
Detta gör vi så bra…
... att vi har världsledare inom telekom-, flyg/försvar-, bil-, finans- och IT-branschen som kunder. Airbus, BMW, Boeing, Deutsche Bank, Ericsson, GE, GM, Motorola, NEC, Samsung, Siemens och Vodafone, för att bara nämna några få.
… att vi kallas världsledande av flera oberoende internationella analysföretag och IT-tidskrifter, exempelvis Gartner, IDC, Yphise och SD Times.* enligt brittiska Computer Business Review är Telelogic ett av de tio mest inflytelserika företagen i världen inom applikationsutveckling under 2005. Förutom Telelogic, som är det enda europeiska företaget, består listan bl.a. av IBM, Microsoft, Oracle och Sun Microsystems.
Vill Du vara med och utveckla Stockholm?Vi på markkontoret har ett finger med i det mesta som handlar om utvecklingen av stan! Här hittar Du projekt som HammarbySjöstad, Kista, Norra Djurgårdsstaden, Årstadal och Slussen för attnämna några. Vi har engagerade ledare, ett långsiktigt tänkande,delaktiga medarbetare och många externa samarbetspartners.
Markkontoret är en förvaltning i Stockholms stad som ansvarar för stadens mark, exploatering för bostäder och företagsområden, med mera. Vi är 140 anställda och är belägna centralt i stan, påKungsholmen (i Tekniska Nämndhuset).
Läs mer om oss och våra spännande projekt på www.stockholm.se/markkontoret
6� © Project India 2005
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6�© Project India 2005
Volvo Aims for the Stars
Volvo established itself outside Bangalore
in 1997. Its business strategy is aimed at the
top segment of the truck and bus market
with regards the technology, quality and
safety. Its forecast for 1997 was to sell 4,000
trucks in the year 2004. The price sensitive
Indian market has, however, slowed down
its development and it now makes a profit by
selling 340 trucks and 300 busses per year.
The huge Indian truck market with 140,000
sold items in the year 2004 is obviously a
huge market with potential. Volvo has a hard
time competing with domestic companies like
TATA and Ashok Leyland who sold nearly
140,000 trucks in the year 2004, when price
is a factor.
The strategy is to only produce high-end
trucks and buses, which the competitors are
so far unable to build. This has made Volvo
famous: Volvo is not a brand in India, it is a
concept symbolizing luxury travel, and even
some three-wheel rickshaws have Volvo stick-
ers on the back. There are two main threats
to Volvo’s development. The first one is that
foreign competitors like Mercedes are entering
the market next year and the second is that
TATA has started to buy high-end technology
from other more developed competitors.
The infrastructure is a big issue for Volvo,
both affecting the production and the full use
of the potential of their products. For example,
all boat deliveries from Sweden to India have
to be reloaded two times because of the small
dimensions of Chennai harbor. The average
speed on the Indian roads is 30 km/h and a
normal Indian truck with a 9,000 kg load has
an engine capacity of 130 hp.
Volvo’s strategy is to find more local
suppliers and continuously customize their
products for the Indian market. But the most
important thing for Volvo’s future success is
to convince the Indian truck buyers that a
one-off big investment can generate profits if
the operational costs are reduced.
Other Swedes in India
The Volvo factory and Head Office outside Bangalore is a large facility, still it is 20 times smaller than the TATA facilities in Pune.
START-UPS
6� © Project India 2005 6�© Project India 2005
Rajesh D. and Anantha Valli S. are two of the Indian CAD designers that cus-tomize Volvo products for the Indian market. For example, the aluminum fuel tanks are replaced by cheaper steel tanks since corrosion is a minor problem in this climate.
The truck cabins are imported in segments from Sweden and then mounted at the factory in Bangalore. This procedure saves space and money in the expensive shipping process. To compete on the price sensitive Indian market, Vovlo is aiming to produce as much as possible in India.
A test driver analyzes the performance of a newly built Volvo bus. The good comfort and high power engines, compared to the Indian competitors, has made the Volvo brand a synonym for a luxury coach bus. This is an impressive accomplishment if you compare to Volvo’s small market share in India.
Truck and bus tires are delivered from a local producer. A glimpse of the old truck fleet inside the organized Volvo facilities.
66 © Project India 2005
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Seco Tools & Trapcode
Other Swedes in India
START-UPS
SECo TooLS
Seco Tools manufactures carbide cutting
tools and started in India in 1997 by purchas-
ing shares in an existing Indian company. The
collaboration led to a fast start-up, but also
to a two-year court battle, when Seco Tools
had different expansion plans than its Indian
partner. These kinds of problems are common
among numerous small non-Indian compa-
nies that collaborate with locally established
Indian organizations. Several Managing
Directors that we met strongly recommended
avoiding this strategy. Seco Tools’ choice for
establishing itself was Pune since it is close to
the financial center Mumbai. Pune also offers
good industrial environments with a lot of
Swedish companies as neighbors.
Seco Tools in India is today a profitable
company with a bright future. Its products
are produced for the global market and the
quality of products has proven to be of an
international standard. Seco Tools earlier
avoided showing the “Made in India” logo
on its global products since they have noticed
that customers can make wrong presumptions
about the quality when told of the location of
the production facility. But now days the logo
is clearly visible.
TRAPCoDE
Trapcode, a Swedish company interna-
tionally known for its groundbreaking video
effects, has recently started outsourcing to
a company in Pune that develops programs.
The outsourced project is to build up a new
database web page for a web-centered user
community.
Overall, the experience of having out-
sourced is good “...but one has to give exact
specifications of what you want, it is not obvi-
ous that you share the same idea of what is
good”, as the Trapcode C.E.O. Peder Norrby
explains.
The costs has been ten times less than in
Sweden, but Trapcode will continue to develop
the company’s core products in Sweden, at
least for a few more years.
66 © Project India 2005
INfRASTRuCTuREMISSIoN IMPoSSIbLE
THE MoNSooNbANGALoRE 2030
6� © Project India 2005
PRojECT INDIA 2005 -
6�© Project India 2005
The biggest challenge for India and busi-
nesses in India is the infrastructure. The
poor quality of the roads is shocking and
the amount of vehicles, people and ani-
mals on the roads is beyond belief. What
is India doing about it?
Although India’s infrastructure is improv-
ing, it is not keeping pace with the rapid
industrial growth. According to CNN/Money,
India’s position as the world’s “outsourcing
king” is slipping and their outsourcing hon-
eymoon may soon be over, all because of the
lack of good infrastructure. Some of the infra-
structure problems include the bad quality of
the Indian roads, the power supplies and the
daily power cuts, ineffective water systems,
and the sanitary facilities that only cover
50% of the urban population. If the Indian
economy wishes to keep its growth, the infra-
structure issues need to be resolved, and fast!
Mission ImpossibleInfrastructure is the Key to Success
“The infrastructure is the greatest threat to fast growing industrial development in India.” Paulraj EdwinProject Manager, Volvo
INfRASTRuCTuRE
6� © Project India 2005 6�© Project India 2005
The representatives from all the businesses
we met during our visit in India have spoken
of the infrastructure issues as being a major
challenge.
THE GoLDEN quADRILATERAL
There are three rules that need to be fol-
lowed while driving in India: you need: “good
brakes, a good horn, and especially some good
luck”. This Indian joke reflects the reality very
well. When you are traveling on the Indian
roads you are in for a very bumpy, noisy and
dangerous ride. It does not matter if you are
in a rickshaw in down town New Delhi or in
a minibus on the highway between Cochin
and Bangalore: the roads and the traffic are
essential problems and represent the main
challenges for every business in India.
The Indian Government is well aware
of the chaotic situation regarding the infra-
structure and in 1999 the National Highway
Authority of India started the Golden
Quadrilateral Project. The aim is to con-
nect four of the major cities in India: Delhi,
Kolkata, Chennai, and Mumbai, by way of a
four/six lane expressway. With a new highly
developed expressway network the Indian
Government wishes to gain many advantages
such as faster and more comfortable journeys,
reduced fuel consumption, safer journeys and
reduced maintenance costs. A high quality
expressway will also open up a new market
for many companies, especially for the ones
manufacturing cars and trucks, like Volvo for
example. Today, a Volvo truck costs consider-
ably more than the domestic brands, but what
Volvo is trying to sell is a high-end truck that
can travel faster, safer, more cost efficient and
more conveniently. For Volvo to be able to sell
such a truck, the roads need to be improved
so that the vehicle can be used to its full
potential and with projects such as the Golden
Quadrilateral this can become a reality.
Paulraj EdwinProject Manager, Volvo
“While driving in India you need three things: a good horn, good brakes and most important of all good luck.”
LENGTH:
5800 km
CONNECTING:
Delhi-Kolkata-Chennai-Mumbai
(Source: Wikipedia, 2005)
Schedule for completion:
December 2006
In August 2005, 92 % of the total length was completed.
The Golden quadrilateralDELHI-MuMbAI-KoLKATA-CHENNAI
According to the India Infrastructure
Summit 2005, the investment require-
ments of the economy for infrastruc-
ture are huge. The Prime Minister
has indicated that the country needs
to invest USD 150 billion in the infra-
structure over the next five years.
Delhi
Mumbai
Kolkata
Chennai
Delhi
Mumbai
Kolkata
Chennai
The Golden Quadrilateral
North-South Corridor and East-West Corridor
71© Project India 2005
NOTICETHERE’S
SPACE HERE FOR
YOU?
AND THISIS THE
LEADINGCOMPANYWITHIN IT
LET’S ASSUME THIS IS THE
FAST MOVING WORLD OF TELECOMS
www.ericsson.com
71© Project India 2005
WHAT’S HAPPENING oN THE INDIAN RoADS?
Even though the quality of the roads will
improve, the problem regarding traffic sense
will remain. The roads are today packed with
people walking, sleeping and practically liv-
ing there. Moreover, there are cows and dogs
patiently standing at the roadside waiting
for their turn to cross, or their turn to just
lie down and relax. If you need to buy some
snacks, flags, tooth brushes or a book, then
there is no need to get out of your car: one
of the temporary shops will come right up to
you, maybe not with the actual things you
need, but they are at your service. When trav-
eling on an Indian highway it is not unusual
for the vehicles to be on the wrong side of the
road if there is less traffic there, or if someone
needs to make a u-turn, they will make a u-
turn. Because of the amount of people, the
traffic culture, and the condition of the roads,
the average speed is about 30 km/h. Still, a
car journey through India feels heart-rending,
exhilarating and terrifying.
The future of India’s growth is highly
dependent on the infrastructure of the road
network. Even though the roads will be
improved, and the Golden Quadrilateral
Project is one step in the right direction, the
culture on the roads will remain and will still
be among the many challenges left to be faced
and dealt with.
“It is hard to sell high power engines to a truck market with an average speed of 30 km/h. Even if the roads are improving the amount of high-way entrances and cows will remain.” Eric Leblanc, Managing Director, Volvo India
PILGRIMS MAKE THE jouRNEY INTERESTING
The distance between New Delhi and Rishikesh is about 200 km and, according
to our Indian driver, it would take about 4-5 hours to get there. It actually took 9
hours. What the driver and us had failed to anticipate was not only the amount of
traffic and people on the roads, but also the pilgrimages walk with thousands of
“saints” carrying water from Ganga back to their homes. Some parts of the road
were closed and other parts were just packed with pilgrims dressed in orange.
It was a long but interesting journey.
Traffic in India: Notice who is wearing a helmet in the picture below.
72 © Project India 2005
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7�© Project India 2005
PoWER CuTS AND CELL PHoNES
For the members of Project India 2005 the
traffic problems and the road infrastructure
became highly visible and were noticed by all
of the businesses that were visited. But there
are other infrastructure problems that also
need to be highlighted. One of these issues
is the electrical supply infrastructure, which
contributes to the daily power cuts and which
has forced all the major businesses to acquire
their own backup generators. But it is not all
about the power cuts; another problem is that
there is not enough power generated, and that
the power losses are too high.
One progressing infrastructure issue is
the cell phone network. Every month 1 to
2 million new cell phone subscriptions are
registered in India and there are a total of 56
million subscriptions (June 2005). To handle
all the new customers and their needs, the
network is steadily growing. The cell phone
network business has become a huge market.
Even though there are 56 million people using
cell phones, there are still several hundreds of
millions of Indians left who have not signed up
to a new subscription. For a global company
such as Ericsson, failing to enter the Indian
market would be a significant mistake since it
offers great opportunities.
“Our main challenge is the infrastructure and the power supply is the most important issue.”Phillip M. Davidson, Atlas Copco India
CoST IN INDIA VS CoST IN SWEDENEight members of Project India 2005 purchased pre-paid Indian cell phone cards, of
which 5 stopped working during the project and some did not work as we had been
promised. This was a very irritating downside to the expanding cell phone network. On
the positive side, we found it to be not that expensive, at least not in comparison with
Sweden, to buy a pre-paid card or to actually use it.
India Sweden
Pre-paid card, activation fee: 20 SEK 100 SEK
Minute cost, local: 0.20 SEK 0.88 SEK
Minute cost, other: 0.40 SEK 0.88 SEK
SMS (local): 0.10 SEK 0.77 SEK
CoMPARISoN of THE CELL PHoNE MARKET Sweden India
Population: 9 million 1 billion (CIA)
% with cell phones: 90% 6% (PTS, 2005)
INfRASTRuCTuRE
72 © Project India 2005 7�© Project India 2005
bACK To THE fuTuRE
The first impression of the recently built subway in New Delhi was the huge contrast with the outside world. No cows, no traffic and no exotic smells, basically a normal calm subway station with nice clean open architecture. The high-tech magnetic travel token (2 SEK) was impressively smart. Once we had figured out how to use it, the ride could then begin. The atmosphere inside the carriage was calm, no other foreigners, just us and a peaceful crowd of Indians feeling grateful not to be a part of the hectic traffic above. But the overwhelming experience of feeling the atmosphere of a future India made us forget our destination. After a little confusing help from one of the station employees, and a chat with two young and proud floor cleaners, we found our way back to the city centre and entered the real world outside the subway gates.
7� © Project India 2005
PRojECT INDIA 2005 -
7�© Project India 2005
THE MoNSooN IN MuMbAI AND PRojECT AIR INDIA
India is a land full of surprises and sometimes even a yearly event such as a monsoon comes as a big surprise. This summer’s monsoon was expected, as every other year. The tragedy that ensued was, however, not predicted. Normally the monsoon waters and nourishes the soil, giving life to the exotic plants as well as to the people, and not the opposite. But nature can be unpredictable.
On 26th July Mumbai received 65cm of rain - the heaviest rainfall recorded in India’s history, causing havoc in a city known for its inadequate infrastructure. Many people lost their homes and their loved ones. Even though this tragedy cannot be compared with our tame experience of the catastrophe, we would like to share our experience of the monsoon in Mumbai and how it affected us.
Three members of Project India 2005 left Stockholm Arlanda on Friday 29th July heading for Frankfurt’s International Airport in order to catch the connecting flight to Mumbai. As we had heard about the flooding situation and the possibility of getting stuck in Frankfurt we asked a female member of the cabin crew at Arlanda about our chances of reaching India. We were told we could go to Frankfurt at our own risk. Being as brave as Vikings should be, we decided to take the risk and challenge Mother Nature.
A few hours later in Frankfurt everything seemed fine. According to the Air India personnel, the flight would leave as planned, which was a huge relief to us, as we had no desire to wait another day in order to get to India. But the faces of the other travelers told another story than the one given to us by the airport crew. When we arrived at the gate a crowd of nervous people were already waiting, ready to fight over a boarding pass. Worried faces were staring at each other; clearly stating, “I was here first!” The air was thick and the atmosphere tense.
The plane arrived from Los Angeles. When it landed in Frankfurt someone heard that the plane was already full. As the rumor spread through the crowd, the mood turned to anger and resignation. What the airport personnel had forgotten to tell us was that there were already several hundred people waiting for a flight to India, both in the United States and in Frankfurt. They had been in the same situation as we were now. At this point we were the ones having to put our names on a waiting list for a seat to India: a list that later appeared not to exist. It had just been a trick to get rid of people struggling to obtain a boarding pass on an already overbooked flight to Mumbai.
We were now trapped in Frankfurt. We did not know if there would be a flight to Mumbai the next day, and even if there was a flight, would we be the winning trio who would get seats on it? We seriously considered renaming our project Project Air India.
Fortunately, there was a flight leaving for Mumbai the next day and we were lucky to get seats on it. The next problem was the computer network in Mumbai, which was down due to the flooding. Air India could not tell which seats were available on the flight. Consequently, none of the passengers were any longer guaranteed a seat. The chaotic boarding procedure turned into something that looked like the Pamplona Bull Run, except for one thing - the bulls running around were not raging bulls of the four-legged kind, they were a hundred furious Indians as well as three exhausted Swedes.
Luckily we got on the flight and even obtained seats next to each other. When the plane reached Mumbai, it was raining so heavily that we could not land. The pilot circled above the city for half an hour before deciding to fly elsewhere. Ok, no Mumbai, we could gladly accept that, considering the “no-water-no-food” situation, which we had heard about. As our final destination for the journey was New Delhi, we were the only people on the plane screaming for joy when the pilot announced that the new destination would be New Delhi. Finally some good luck!
“The infrastructure in the city has collapsed but people have a very short memory. We seem to forget and forgive and do not come up with a constructive plan”
John Josy, a resident of Mumbai talking about the monsoon
INfRASTRuCTuRE
7� © Project India 2005 7�© Project India 2005
77© Project India 2005
Elekta was founded in 1972 and
has today approximately 1,700
employees in 20 offices worldwide.
Elekta’s corporate headquarters
are located in Stockholm, Sweden
and the company is listed on the
Stockholm Stock Exchange.
For more information please
visit www.elekta.com
Fighting serious disease
Elekta is a world-leading medical-technology Group, providing meaningful clinical solutions, compre-
hensive information systems and services for improved cancer care and management of brain disorders.
All of Elekta’s solutions employ non-invasive or minimally invasive techniques and are therefore
clinically effective, gentle on the patient and cost-effective.
Elekta’s systems and solutions, including Leksell Gamma Knife® for non-invasive treatment of brain
disorders, Elekta Synergy® for image guided radiation therapy (IGRT) and IMPAC oncology management
software, are used at over 3,000 hospitals around the world.
Fighting serious disease www.elekta.com
� Stereotactic Neurosurgery � Gamma Knife® surgery � Functional Mapping � Precision Radiation Therapy � Image Guided Radiation Therapy � Stereotactic Radiation Therapy
77© Project India 2005
bANGALoRE YEAR 2030 AN oRDINARY DAY IN THE LIfE of RAjEEV
It is early Monday morning and the year is 2030. The IT capital of the world, Bangalore, is slowly waking up.
Rajeev’s old 5G cell phone makes a loud buzzing sound, but he is already awake and ready to get up for work. Rajeev is one of IBM’s 700,000 Indian IT-consultants and he is now working on a huge business project in the field of nuclear power. Even though he works until 12 p.m. every night he always gets up very early, eager to go to work.
When he got his job right after graduating from IIT Bombay the salaries were very low, even by Indian standards, so a promotion or switching company is the best way to get a higher salary. Every year, India produces 7,000,000 IT engineers so the companies can really keep the salaries at an all-time low. Rajeev is, however, not worried. He is smart and really hard working so the future looks promising.
He grew up outside Bangalore in a very simple family. They were not very poor, but had limited finances. Thanks to his interest in mathematics and his ambitious spirit he managed to win a scholarship. This gave him the chance to go to one of the best colleges in India and at that time he knew that his future was bright. Even though the middle class has been growing now for many years, poverty is still a huge issue in India and ever since his childhood Rajeev has been grateful for not being very poor.
A picture of a young Rajeev and his sister, Bangalore 2005.
7� © Project India 2005
PRojECT INDIA 2005 -
Now Rajeev lives in central Bangalore. His office is in one of the suburbs, so getting to work is a tricky business. There is no use trying to drive on the roads, they are already packed with trucks and solar-powered rickshaws. The metro is the fastest way to get there and Rajeev is lucky to have metro stations both near to his home and his workplace. He owns a nice Indo-Chinese car, but he only uses it when there is no other option. The government is encouraging everyone to use the metro and Rajeev is very concerned about the environment and therefore follows the government’s advice.
Looking at the roads of Bangalore he thinks that, even though the traffic is less now after the opening of the city metro, Indians still need to learn how to drive. He came to this conclusion while visiting his brother in the United States last year.
Rajeev’s office is in one of IBM’s 20 skyscrapers, soon to be 25, and when he gets there at 6.30 a.m., many of his co-workers have already started working on today’s tasks. He sits down at his desk to look at today’s schedule, and he realizes that he probably will not get home before midnight today either. He is a little bit tired and for a few seconds he wants to go home. He reminds himself, however, of how lucky he is to have a job at IBM and continues therefore working with a happy smile.
After a long working day, Rajeev returns home to his wife Sahana and their 2-year-old son Chandan. The apartment is quiet; Chandan is asleep and Sahana is working on her doctoral thesis. She is always studying at night because in the daytime she works as a medical doctor and in the afternoon she takes care of Chandan. Sahana means “patience” and Rajeev thinks that, if there is one quality his wife possesses, it is patience.
Rajeev sits down on the sofa, he drinks a Coca Cola and dreams about the vacation the family will have in Europe in a few years from now.
INfRASTRuCTuRE
Night in Bangalore 2005.
7� © Project India 2005
CuLTuRECuLTuRAL DIffERENCES
POVERTyEDuCATIoN
�0 © Project India 2005
PRojECT INDIA 2005 -
81© Project India 2005
When a country is one-third the size of
Europe and is home to over a billion peo-
ple, it is bound to have interesting culture
diversity. During our visit, we encountered
cultures that both amazed and annoyed
us. We noticed several differences from
Western cultures, but also diversity within
the country. In this chapter we will em-
phasize some of the cultural differences
we reacted to.
GEoGRAPHICAL DIffERENCES
Indian people do not all derive from the
same place. In northeastern India the people
are descendents of the Mongolians, in the
northwest the people are of Indo-Aryan
descent and in the south people are darker
as a result of African immigration. The
ethnic diversity is reflected in the variety of
languages and dialects spoken in India - 17
major languages and 900 dialects or closely
related subsidiary languages. The way people
act varies between the different parts of the
country and one explanation for this is the
country’s history. In the past, when India had
been invaded, the attacks had always come
from the north. Once the invaders advanced
further south, geographical obstacles stopped
them. Therefore, those living in the south are
considered to be more peaceful and calmer
than those in the north. Another effect of the
threats in the north was that the people there
worried about not getting enough food. The
food they ate consisted therefore of more fat
than in the south, something that is true even
today. Another difference in the food is that it
Cultural Differences
A hectic day in Old Delhi, near the Red Fort. Here one meets Muslims, Hindus, Sikhs, Buddhists and Christians among others.
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is spicy in the south and rice is a common side
dish, while in the north the food is milder and
wheat is more common than rice. Traditionally,
a lot of Indians eat vegetarian food because of
their religion. Due to influences from the rest
of the world, chicken and lamb are, however,
fairly easy to find nowadays.
THE HARDWoRKING NATIoN
Because of the different kinds of Indian
people, it is not possible to generalize whether
the entire nation is hard working or not.
However, as we traveled around the country,
we saw two extremes.
On the one hand, we saw what you read
about in the newspapers: the hard working,
efficient and highly qualified people working
for a fraction of the cost of an employee in
the West. At Capgemini in Mumbai we had
the opportunity to meet with Nirav Shah,
who started a year ago immediately after his
studies at the university. He told us about the
training he had done when he joined the com-
pany. He had worked day and night without
any free time, but he still believed it was the
best time of his life because he had learnt a
great deal. Being this eager to learn definitely
has a positive effect on the company but Nirav
also explained the down sides it brings with
it - a very competitive working environment.
This results in colleagues not sharing informa-
tion with each other because they are afraid
that another colleague will take credit for it.
Another example of motivation and dedica-
tion comes from the sprawling slum areas in
Mumbai, where there are a growing number
of underprivileged children. Slum areas are
selected randomly and the children staying
there are given the opportunity to attend
Akanksha (in total 2,000 children out of 2 mil-
lion). Akanksha is an extracurricular school
that aims to help children achieve higher edu-
cation and find their way to a better life. Thirty
of the most talented children get to join the
top class where the days are longer and they
receive extra lessons every day. In Sweden,
Social Initiative is one of the companies that
have partnerships with Akanksha and have
made it possible for employees at Carnegie
in Sweden to support projects for the poor
in India. The children attending Akanksha
The Akanksha School arranges education for talented children with less means. A typical day starts at 5 a.m. to bring water for the family, and ends at 12 in the night finishing their home works. The children had clear ambitions. “I want to become a leader” a 10 year old boy said and one girl explained “I will be a doctor and make medicine for cancer”.
“Thirty of the most tal-ented children get to join the top class where the days are longer and they receive extra lessons ev-ery day.”
An employee in the port of Mumbai
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have a positive attitude to hard work because
they really want to get somewhere and make
a better life for themselves and their families.
Many of the children start at 5 a.m., when
they fetch water for their families and then
they study until late in the evening. Although
they have extremely long days, they still want
to take time to help other children who have
not had the chance to go to school. The people
mentioned in these examples are not unhappy
with their workload; it seems rather that they
find themselves privileged to have come as
far as they have. This is understandable in a
country, where the competition is extremely
tough due to the huge population.
On the other hand, we gained another per-
spective when travelling around, namely, that
of bureaucracy and a lack of structure in some
places. Since salaries in India are very low,
many people are employed for the same tasks
which may results in inefficiency. However,
it is important to remember that this, on one
hand, is a social responsibility that the compa-
nies take. By hiring many people they decrease
the high unemployment and thereby gain the
social well fare.
INDIAN GENERoSITY
It is our experience that Indians are very
generous and always offer their help in every
situation. Our first encounter with Indian hos-
pitality occurred at the airport in Frankfurt
where some of us got stuck because of the
flooding in Mumbai. Even if people were
desperate and affected in different ways by
the catastrophe, one man still took the time
to explain how we should find our way when
arriving in India and gave us his number to
call if we needed any help on arrival.
The representatives of the different com-
panies we visited were more than welcoming
and really wanted to guide us and help us find
things to do, not only during our visits to the
companies, but also after office hours. Indiska,
Atlas Copco and Evalueserve all arranged eve-
ning activities for us.
YES, YES, No PRobLEM
In India, “yes, no problem” is a phrase
that cannot always be trusted. We sometimes
experienced that we could not get a straight
answer because the people were so eager to
please us. Often a person will say “yes” when
you ask him something, even though he him-
self knows that he is unable to help you. For
instance, it is quite common that, if you ask
someone for directions, whether they know
the way or not, they do not want to disap-
point you, so they will go ahead and give you
directions anyway.
Communication problems are a frequently
occurring obstacle when different cultures
meet. As an example Kent Karby Hansen at
Capgemini is working on bridging the com-
munication gap between the Danish and
Indian colleagues by trying to find a common
way of communicating. However, it is not
only the different languages that vary, but also
the way we talk as well as our body language.
Anybody who visits India will notice the dif-
“After a few years in Belgium, my ex-perienced is that Indian employees are ready to work more than double as hard as the European engineers.”
Sachin Chava, CAD - Engineer, Atlas Copco India
A happy man in a bus in New Delhi.
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ference in the way Indians nod their heads.
In India, shaking the head from side to side
means that you understand what the other
person is saying and usually that you agree
with them. Therefore, often what we consider
as being a “no” is, in fact, a “yes”. Once you
understand the difference, it is quite clear what
they mean. In spite of this, we encountered a
misunderstanding while visiting Seco Tools in
Pune, when we thought that two people had
different opinions when they, in fact, were
nodding in agreement.
FAMILy TIES
Family ties are very strong in India. There
is a strong culture of taking care of the elderly
and children often work in the family busi-
ness. When we visited Indiska we got to know
Sailesh Nair who is working together with his
father at the office and living together with
THE INDIAN WAY
In Bangalore when we were going to visit Volvo we had ordered two cars with drivers to pick us up at the hotel at 7 a.m. and drive us to the office. At the appointed time only one car showed up and we asked therefore where the other car was. The present driver told us that he was on his way and would arrive within five minutes.
After 25 minutes we asked him again, slightly more annoyed this time, and he assured us once again that the other car was on its way “Yes, yes, no problem just one minuet “. Finally we were truly irritated and explained to the driver how deadly important our student tour at Volvo was. This time he told us that the other car had to be cleaned and that it would arrive in 45 minutes.
He probably knew this all along but didn’t tell us. Boiling with rage we all squeezed into one car and the problem was solved the Indian way.
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him at home. More than one generation liv-
ing together is very common. Usually when a
woman gets married, she moves in with her
husband and his family. As a result of the
strong family ties a lot of people, who go
abroad to work or to study, return home after
a couple of years to be with their families.
CASTE
When thinking of India you cannot help
but wonder about the caste system and how
it affects life today. Whenever you ask some-
body about this you get the same answer: the
caste system no longer exists. Discrimination
due to caste is against the law. We talked
about this when visiting Atlas Copco and we
learned that all their managers are Brahmins,
i.e., of the highest caste. Is this a coincidence?
Caste ranking and caste-based interaction
have occurred for centuries and will probably
continue to do so in the future. This notion
is, however, more common in the countryside
than in the cities and in such relationships like
marriage than in less personal interactions.
”Caste biases is a non is-sue in the business world but there are strong community links.” Phillip M. Davidson Managing Director, Atlas Copco India
We met this farmer family in Aurangabad. Harald asked if he could take their photo. “Yes, Yes, please do so, only 20 rupees”. The agriculture employs 60% of India’s population. After school the children often help their parents on the field.
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Volvo is an internationally renowned
transport-industry group specialising in
research, development and manufacture
of commercial vehicles. We make trucks,
buses, construction machines and engines
for marine and industrial drive systems,
as well as aircraft engines and spacecraft
propulsion systems. There’s a whole
range of challenging and stimulating jobs
within our organization and business.
Read more about your career options at:
www.volvo.com
Accept a challenge!
�6 © Project India 2005
PRojECT INDIA 2005 -
�7© Project India 2005
Despite the fact that India has one of the
fastest growing economies in the world
poverty is still a huge problem. This was
one of the first things that hit us when we
arrived in India. Along roadsides in the cit-
ies, people are living in sheds and on the
ground. One can see whole families with
young children and babies sleeping in the
badly polluted air, on the soil between the
lines of the jam-packed highways. The
contrast from the nice business environ-
ment is striking. The main challenge for
India today is to reduce poverty.
The Indian financial system is one of the
fastest growing in the world. The economy is
booming and the middle class has increased
to over 250 million people. Despite this, one
third of India’s population is living in extreme
poverty - they have less than USD 1 to spend
daily. Moreover, two thirds of India’s 1.1 bil-
lion citizens have just USD 2 to spend on a
daily basis. Worldwide, one fourth of the poor
people in the world are Indians.
There is a clear correlation between the
vulnerable groups of Indian society and social
identities, such as caste, sex and ethnic groups.
Also, the development between states and
regions differs. Consequently, the injustices
are huge, especially concerning education,
health care and economic capabilities. During
recent years, poverty has tended to be more
and more geographically concentrated. Half
of India’s poor population lives in the northern
states, of which some seem to be not a part of
the economic development whatsoever. Those
states can be compared to some of the poorest
countries in the world. On the other hand, the
wealthier states have reached an economic
standard and social level, which one may not
find in other developing countries.
Countless children in India live in the most
difficult of conditions. At least 20% of the
children in the world that do not have the
opportunity to go to school and 25% of the
children that die before reaching the age of
five are Indian. After South Africa, India has
the highest rate of HIV and Aids among the
populations in the world. This is a great threat
to the future social and economic development
of the country. Many argue that the recent eco-
nomic growth is having a negative impact on
the environment. This also affects the poorer
population, for example, as it might result in a
lack of water. You can read about this in “The
Backside of India’s Economic Boom”.
According to a report from UNDP’s Human Devel-
opment Report 2005, over 2.5 million children die
in India every year, accounting for one in five child
deaths in the world. Girls are 50 per cent more likely
to die than boys. The report states that if India can
close the gender gap between boys and girls in the
age of 1-5 year, 130 000 lives will be saved and the
child mortality rate would decrease by 5 per cent.
The report also states that the life expectancy is
63.3 years to be compared to 79.4 years, which is
the life expectancy in Norway.
(Source: The Times of India Sept. 05)
Poverty
The total amount of people living under extreme poverty is still the same as earlier. The difference is that India’s population has grown rapidly during the same period.
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Population below poverty line
(Statistical Outline of India, TATA)
010
2030
4050
60
%
1973 - 74 1987 - 88 1993 - 94 1999 - 00 2007 f
Less than 1 US$ to spend daily
Less than 2 US$ to spend daily
More than 2 US$ to spend daily
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However, there is a lot more to India than
just poverty and disaster. The growth in IT
and other service sectors is impressive and
is one of the reasons why the middle class
has tripled to 250 million individuals. India
is also a dynamic country with an organized
social structure. The country has many differ-
ent religions and cultures, sometimes causing
conflicts. India seems, however, to be able to
solve those troubles within the laws of democ-
racy. The government elected in 2004 is, more
than ever before, focusing on poverty and is
putting more effort into solving the country’s
social and economic inequalities. Many com-
panies also assume a great responsibility with
regards human care programs, both for their
employees and other citizens. For example,
IBM is working on an accessibility project
with Victoria Memorial School for the Blind in
Mumbai. Another example is Indiska, which
since the year 2000 has been helping to launch
a school in Karur. The aim is to improve the
living conditions of ex-child labor, equip rural
youths living in areas, where child labor is
rife, for better prospects of employment and
help these children to understand the modern
professional world.
Clearly, India is a country consisting of
two worlds. One where you can see the posi-
tive development, changes and innovations
ultimately resulting in increased economic and
social conditions. The economic boom has
definitely had a positive affect on the social
standard of living, especially in the cities with
huge contrasts in living conditions. In the
other world, however, extreme poverty tends
to last. Numerous people require their human
rights and are excluded from the dynamic
development because of their sex, religion or
caste.
A strong memory is when we entered Mumbai from the highway express that leads from Pune to Mumbai, which is one of the best and most modern highways in India.
Coming from such a modern construction we were not prepared for the sight of the slum areas that met us, a number of people sharing a small living area consisting of nothing but mud walls and a tarpaulin as a roof, no toilet, kitchen or water.
Small children lying naked on the sideways looking at us with empty eyes is very hard to get used to.
“Many Indian companies also take big responsibility in human care programs.”
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Education
“India is not a sporting nation, it is an edu-
cation nation”. This is a general thought
that reflects the attitude to education in
India; an attitude that can lead India to-
wards becoming a great economic power
and can make India a strong competitor
alongside other countries in the world.
While comparing Indian and Swedish kids
it is easy to understand why India is develop-
ing so rapidly. Even though sports are becom-
ing more and more popular, children tend
to focus more on their education. The most
important thing for an Indian child it not so
much winning the cricket game but rather
to get the best marks in school. The respect
for learning and the happiness of having
the opportunity to go to school are evident
among Indian youngsters from well-educated
families. Living their lives close to poverty
makes them realize how lucky they are and
that is what probably gives them the eagerness
to learn. Mats Agervi, IBM, confirms this with
the statement: “Why are the students working
so hard in India? The answer is that here is the
real world. No one takes care of you; you have
to take care of yourself, through education”.
Even though Swedish students go to univer-
sity for free and have access to student grants
and loans, there is no such sign of gratitude or
happiness among them.
bECoMING A GREAT ECoNoMIC POWER
India has some of the highest ranked
technical universities in the world. The most
popular schools for engineering are the Indian
Institute of Technologies, IIT, founded in
1950 by the central government. Their quality
of education has acquired them the status of
being listed among the top technical schools
in the world. To get into the Indian universi-
ties the students must pass entrance exams
and those with the highest scores often choose
the IIT. The rest apply to either the regional
engineering colleges, which come next in the
rankings, or end up in the private engineering
colleges. It is extremely hard to get admitted
to an IIT, but those who succeed almost cer-
tainly get a well-paid job in the future.
In the past, a significant number of gradu-
ate students from the IIT left India to live out
the myth of the dream life in Europe and in
the United States. Fortunately for India the
trend is changing. Indians are starting to see
the potential of their home market and are
proud of the label “Made in India”.
The newly gained confidence and a great
spirit of entrepreneurship are helping India
to become a great economic power. An
example of the faith in entrepreneurship is
that the IIT are encouraging entrepreneurship
by helping students who want to start up a
company. Students can apply for assistance
by presenting their idea and the best students
get workrooms for free for a certain period of
time as well as help from professionals. One
of the former students that we met at IIT was
very young and he had already started up four
companies. Furthermore, most of the students
that had started up companies were in the age
group 20-25. “The aim is that the students
shouldn’t have to search for a job when they
get out of IIT, the aim is that they will create
the jobs instead”, says Professor Deepak B.
Phatak. With this interest in entrepreneurship,
the Indian economy will definitely continue to
grow with a speed that is impossible for most
other countries to keep up with.
A winning attitude?
“India is not a sports nation, it is an edu-cation nation.”
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THE DRAWbACKS WITH AMbITIoN
For the Indian economy, it is clearly profit-
able to have a well-educated middle class, but
what are the drawbacks?
Is it too much stress for a six-year-old
child to go to admissions interviews at the
best schools? Will India meet the same fate as
Japan where the rate of suicides is high due
to excessive stress? Have the Indians realized
that they need to focus on their quality of life
as well? To some extent, they have. They have
started to go on vacation to other countries
and sports are becoming more popular. But
does the six-year-old child, who is anxious
about the interview, need more time to play?
Despite the fact that the middle class is very
well educated, some say that there is a lack of
highly qualified engineers - that only the best
universities are good enough. The number of
universities has increased rapidly in India. In
1950, there were 27 universities and today
the number has reached 304. Is the average
quality of education increasing or merely the
quantity? Companies like Volvo and Atlas
11-year-old Rohini goes to school six hours a day and, furthermore, she studies three hours at home every evening. Sometimes she has no homework on Saturdays, but she often dedicates her free time to getting prepared for the big exams. She goes to an English school and her handwriting is perfect. In addition to speaking English, Marathi and Hindi, she has been studying Sanskrit for a few years.
Rohini is a typical middle class Indian girl. She comes from a well-educated family and both she and her family put a lot of effort into making a good student out of her. Rohini has been studying hard since she started going to school. Her eagerness to learn new things is astonishing and her dedication and ambition are far beyond those of a normal Swedish 11- year-old.
Like Rohini, most Indian middle class children start their schooling with kindergarten classes at the age of three. Even for the first years of schooling many children go to interviews hoping to get into the best schools. After being admitted to a school the student has about 14 years of education to look forward to and specializes in the field, which he or she opts to take as his or her career during the last two years of schooling.
It is common among middle class children to go to English schools. Their English skills are often very good. Rohini can, for instance, switch from Marathi to English without any effort. The excellent English skills along with the fact that India has a very highly respected education system probably constitute the major reasons for Indian doctors and engineers being highly regarded abroad.
11-YEAR-oLD RoHINI
“India’s youth are its greatest opportunity as well as threat. If they are not provided proper edu-cation and jobs the nation will be lost.” Outgoing vice-chairman and CEO of Bangalore-based IT company Wipro Technologies.
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Copco hardly have a hard time finding good
engineers, but might that be due to the fact
that highly regarded international companies
attract the best engineers?
The economic development is rapid, the
number of universities is increasing and the
Indian middle class can look to a bright future,
but what about the millions of children who
do not have the opportunity to go to school?
Even though there are publicly financed
schools for less fortunate children, not many
of these children can devote sufficient time.
Poor children need to work to support their
families and they do not have much time
left for studying. As a consequence, only the
brightest poor children have the possibility of
succeeding. Furthermore, some people have
doubts about the quality of publicly financed
education in India.
However, for the poor children, progress
is being made. One example is the Akanksha
School in Mumbai. There are 2 million poor
children in Mumbai and Akanksha operates
44 centers, in total giving 2,000 students an
opportunity to increase their chances. Most of
the children live in shelters in the slum that
can easily be seen from the road. In Sweden,
Social Initiative is one of the companies
that have a partnership with Akanksha. It
is through them that Carnegie employees in
Sweden, for instance, support projects for the
poor in India. It is very common that Indian
companies support schools. For instance,
TATA takes an active role within this area.
Hopefully, foreign companies that enter the
Indian market will also assume responsibility
and support initiatives for the poor people.
It should be a matter for foreign companies
to be sponsors since this is an opportunity
to give something back to the country that
they are utilizing and to contribute to a better
future in India.
“Students shouldn’t have to search for a job when they get out of IIT, the aim is that they will create the jobs instead.” Deepak B. PhatakProfessor, IIT Mumbai
Although the most popular sport in India is cricket, some also play soccer as you can see in the picture above.
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THE ENDCoNCLuSIoN
PRojECT MEMbERSACKNoWLEDGEMENTS
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THE END
Conclusion
Prior to our visit to India as well as dur-
ing our journey we had the opportunity to
meet numerous individuals who shared
their thoughts with us about India. We
have shown you the country from our per-
spective, characterized, above all, by the
experiences that the journey brought with
it, and somewhat influenced, however, by
the common opinions of the people we
met.
Through this project we set out to identify
the potential of the Indian market. India is
in the process of claiming its position among
the main actors of the global economy. Yet,
several challenges lay ahead. Our experience
and analysis of the country tell us that the
opportunities that the market presents mean
that India will overcome these challenges.
The principal force behind India’s emerging
economy is the country’s highly educated
and motivated brain pool. This, combined
with the enormous purchasing force of the
market, attracts global companies and their
investments. There is therefore no doubt in
our minds that we will most certainly find
ourselves coming into contact with the Indian
market again in our future careers. We must,
however, point out that not all of us in the
group can envisage ourselves working in this
environment today under the current circum-
stances. The cultural differences with our
lifestyle, the extreme competitive spirit of the
Indians spreading to all fields of business and
the overall challenges described in this report
(poverty, infrastructure etc.) present a much
too great an obstacle for us to tackle.
In addition to the country’s bright economic
future, one must not forget the importance of
the country’s culture, dating back to 3000
B.C. Throughout our journey to the diverse
regions of India, we came across nearly all
major religions of the world. We noticed that
there exists a certain harmony between the
different cultures in the country, no matter the
religion or the caste. Tolerance and peaceful-
ness constitute the greatness of Indian culture
and the mentality of its inhabitants. Due to
these cultural differences as well as geographi-
cal ones, India must not be seen as simply a
country but as a whole continent.
The lesson learned through this project is
that India cannot be seen merely as a source
of labor. It presents great potential in several
fields, research and development being one of
the most important. Most of the companies
we visited during our trip had moved parts of
their R&D activities to India.
An opinion shared by the managers of
the foreign companies we visited was that
in order to be successful when establishing
yourself in this nation you need to have an
Indian representative in the local market. It is
crucial to be able to work and communicate
with a person who knows the market and its
conditions very well. This represents a great
advantage. In order to enter the market suc-
cessfully, global companies need to preserve
their core activities while transforming their
business segments in order to adapt their
strategy to the Indian market.
Furthermore, we realized that the com-
panies we visited were eager to contribute to
Indian society and that environmental issues
were prioritized. They were also very keen to
make sure that their employees were working
in good conditions. This is one of the factors
that motivates a large number of Indians to
start working for foreign companies in India.
Since the companies take good care of them,
we noticed a high degree of motivation among
these employees. We can conclude, however,
that back in Sweden there is a certain lack of
this energy.
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Project Members
THE END
Per Wennerström, perwenn@kth.seProject Manager
“India never stands still. The pulse and move-ment into a new society is striking. Yet, it is a country grounded on ancient traditions and culture that will remain unchanged. One unfor-gettable memory was when we travelled from the busy industrial city of Coimbatore to the calm mountain village Ooty. We came there by an old noisy steam train and climbing up the mountains surrounded by tea fields. This was a journey from the new India to the untouched India.”
Robert Lagerström, robertl@kth.se
“The memory that will stay with me the longest is when we arrived in Rishikesh, a small mountain town at the foot of the Himalayas, where there was a pilgrim festival. Apparently meeting a party of eight Swedes was the most exciting thing that had happened to them, a large group of Indian pilgrims were following us where ever we went, no matter if we were shopping, eating or just sight-seeing.”
Sam Rahbar, rahbar@kth.se
“I am grateful to have received an insight into the business culture of India and the strategies adopted by global companies when entering the Indian market. While travelling across the country, one can literally feel the potential and the motivated spirit of this nation. The greatest memory of our journey remains that of the cricket game while visiting a small village in southern India; a game we did not fully master, much to the crowd’s amusement.”
Sofia Groth, sofiag@kth.se
“This picture is from Tah Mahal. After admire-ing the magnificant building we sat down to await the sunset. Suddenly we were the objects of investigation. In one minute we were surrounded by Indians who unashamed exam-ined our peculiar skin and odd haircolour.”
Malin Olin, malino@kth.se
“For me, visiting Akanksha School in Mumbai was a rewarding experience; the children attending the school impressed me greatly with their positive attitude although they have longer days than any of us. I cannot describe India in one way, however when I think of India I remember the colours, the smells and the taste of mouth freshener.”
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Harald Knape, hknape@kth.se
“One among all of the photos from this journey brings me a very special memory. An early morning in the beautiful Kerala, I took a picture of what I thought was a peaceful fisher-man philosophizing at the idyllic beach.Later when I examined the picture everything took a different turn, I had offended the fisher-man by taking a photo of his private morning toilet session.”
Fabian Bonnier, bonnier@kth.se
“Everyday in India gives you memories for life. One among many was riding an elephant through the jungle. The excitement of climbing up, the horror of sitting there and then feeling the back hair of the elephant cutting into my flesh as needles is surely a memory for life.”
Marie Håkanson, marie7�@kth.se
“It was amazing to come close to the huge extremes of India. Next to the slum areas and the streets full of cows and goats, one can find high buildings rising which gives an indication of the new India and its growing potential. The entusiastic poor children in the schools, the spontaneous invitatation to a familiy’s home in Aurangabad and the friendly rickshaw driver who let me drive his Rickshaw on the streets in Bangalore are just a few examples of pictures I will keep in my mind.”
Pernilla Emenius, emenius@kth.seProject Manager
“India with its friendly and dedicated people along with the good food, crowded streets and persistent salesmen has had a large impact on me. But one of my best memories is the drive from Aurangabad to Mumbai travelling through the beautiful landscape. Driving on bumpy roads passing villages and open fields with colours so intense it amazed me, the thought of it still makes me happy.”
Viveka Andersson, vivekaa@kth.se
“Since my childhood I have frequently visited India, my mother’s native country. I have always loved this country; the friendliness and the hospitality. This time I was happy to see how fast India is moving forward and how Indians are getting proud of what they have achieved. I hope and believe that India will meet an even brighter future.”
�6 © Project India 2005
PRojECT INDIA 2005 -
�7© Project India 2005
Acknowledgements
A.J. Satoskar, Larsen & Toubro
Abhijeet Kelkar
Abhishek Johnson, Evalueserve
Ajit Chaphalkar
Anantha Valli, Volvo
Anders Flodström, KTH
Anders Thambert , Indiska
Anil Trigunayat, Indian Embassy
Anjali Chandavarkar, AstraZeneca
Anna Kinberg Batra, Author
Anne Höglund, Ministry of Foreign Affairs
Annika Bengtsson, ÅF
Anoop Kumar P.K., Larsen & Toubro
Ashish Gupta, Evalueserve
Ashok Nehru, Swedfund
Axel Widmark
B.D Markad, Seco Tools
Bengt Johansson, Swedish Trade
Bicky Chakraborty, Elite Hotels
Britt Larsson, Realtryck
Camilla Larsen, AstraZeneca
Caroline Cederlöf, Social Initiative
Catrine Larsson, Capgemini
Christina Baines, Indiska
Claes Ahrengart, Atlas Copco
Clarence d’Souza, Volvo
David Ståhl
Deepa Gopalan Wadhwa, Indian Ambassador
Deepak Phatak, IIT Bombay
Denise Johannisson, Orrefors
Ewa Webb, SAAB Baracuda
Fredrika Ornbrant, Ministry of Foreign Affairs
G. S. Nawathey, Larsen & Toubro
Gautam Bhattacharyya, Swedish Embassy New Delhi
Girish Johar, Ericsson
Gunnar Benediktsson, KTH
Helen Hellströmer, Europeiska Reseförsäkringar
Jaydeep Deshpande
Jeffrey Jeyaraj, Indiska
Joakim Hjerpe, Volvo
Johan Karlander, Evalueserve
Johanna Grönkvist, ÅF
Jonas Wiström, ÅF
K.P. Ramachandran Nair, Indiska
Karin Hedén, Scania
Karl Jonasson, ÅF
Keenan Pereira, Capgemini
Kennet Åhbrink, SAAB
Kent Kærby Hansen, Capgemini
Kjell Casenberg, Ericsson
Kjell G. Andersson, Volvo
Kristina Andersson, Vagabond
Kurt Hellström
Lars Walan, AstraZeneca
Lena Höglund, Elekta
Lotta Bynke, Atlas Copco
M.K. Patki, Larsen & Toubro
Magnus Chröisty, ManCo Mode
Magnus Gyllenhammar, Photografer
Mamta Tyagi, Evalueserve
Mansoor Ahmed, Volvo
Maria Lanner, Swedfund
Marianne Persson-Söderlind, KTH
Marina Högland, Markkontoret
Mats Agervi, IBM
Merl Iyer, Time Out Mumbai
Mikael Kyander, Scania
Mikael Valier, MIFAB
Narendra Taneja, Journalist Dagens Industri
Niclas Trouvé, Swedish Embassy New Delhi
Nitin Seth, Mobiance
Pankaj Mukhija, Ericsson
Paulraj Edwin, Volvo
Per Norell, Seco Tools
Pernilla Bard, Social Initiative
Per-Olof Björk, Ericsson
Phillip M. Davidson, Atlas Copco
Prajeet Patel, Evalueserve
Puneet Kumar, Ericsson
Pär- Anders Pehrson, Ericsson
R.G. Khatri, Larsen & Toubro
Rakesh Mathur, Webaroo
Ramon Wyss, KTH
Ranjeet Jagtap
Robin Sukia, SIBC
Sachin Chavan, Atlas Copco
Sailesh Nair, Indiska
Sandeep Pal, Ericsson
Sanjay Mangrulkar, Seco Tools
Satheesh Karanth, AstraZeneca
Sebastian Lourdudoss, KTH
Seema Dueland, Convenient.info
Seshadri Seetharaman, KTH
Simon Moores
Sirinivasan Muralidhar, Volvo
Smiti Ruia, Time Out Mumbai
Srinivasan Muralidhar, Volvo
Stefan Folkesson, SBL Vaccine
Thierry Cros, Seco Tools
Tina Vajpeyi, Akanksha school
Ulf Hjalmarsson, SIBC
Ulf Nordqvist, Volvo
Waldemar Tevnell, Puls Biznesus
Viktor Svensson, ÅF
Vishal Pandit
THE END
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