Embed Size (px)
Citation preview
>>> Back to index
Incredible IndiaHarald Nævdal, Innovation Norway, New DelhiIn cooperation with NCE Maritime, Ålesund, 23.09.2010
Facts India
India
•••••••
Population (2010)AreaCapitalCapital’s populationGDP Growth (2009)Inflation (2009)
1,171 mill3,287,263 sq. km
New Delhi15.3 mill
7.4%11%
>>> Back to index>>> Back to index
Coastline: 7,516 kilometersCoastline: 7,516 kilometers
•••
•
•
AgricultureIndustryServices
Inflation (2009)GDP/Capita (2009)GDP Composition (2009)
Demographical data
Religions
11%1,136 USD
17%23%60%31%64%5%
80.5%13.4%
Age 0-14:Age 15-65:Age > 65:HindusMuslims
•••
India• World’s largest democracy – 714 million electors• 28 Union States and 7 Union Territories• Passing China’s population in 2030• 50% of the population below 25 years• Literacy rate: 61%• Public financial year: April 1st to March 31st• Only 28 million of the 397 million workforce are employed
>>> Back to index>>> Back to index 3Photo: Brendan K Buckley
• Only 28 million of the 397 million workforce are employedin formal Indian companies => CSR is challenging
• 60% of GDP is related to India's domestic market, whichstill is in early development.
• India have large and high education, cheap labour (lowercost-level than China), and a large domestic market
• Bureaucratic formalities limits India in improving its productivity
BMMP Business
MatchMaking Programme
Consultants available
(competent/reasonably
priced)
Status India
Large and fast growing
market potential
IndiaStrategy
>>> Back to index
priced)
4
Challenging business
culture and IPR
protection
Building networks is
crucial
Sector Focus
Maritime
Energy & Environ-
ment
Oil & Gas
Increasing interest from Norwegian companies
Trustworthy market
information available
Consider to establish
presence in Mumbai
ICT
India Macro Information
>>> Back to index 5
India Macro Information
GDP Growth In India2012-2020:
Average
growth
rate: 7.7
>>> Back to index
India will be in the front of Asia's expansion in 2010, growing at rates of 8,5 %
Source :Statistics of India – TATA Services Limited (Dept. of Economics & Statistics)6
Sector Share in GDP
>>> Back to indexSource :Statistics of India – TATA Services Limited (Dept. of Economics & Statistics)
7
Foreign Investment policy
• An increasingly attractive destination
for FDI over the past decade:
• Large market
• Positive cost structure30
35
40
BUS$
>>> Back to index
• Positive cost structure
• Favorable macroeconomic climate
• The FDI are skills incentive (ICT,
services)
• The government is committed to
liberalize its FDI regime0
5
10
15
20
25
2006 2008
AnnualFDIinflowsinBUS$
FDI Confidence Index
1.China
2. USA
3. UK
4. Germany
2002
1.China
2. USA
3. India
4. Brazil
2010The 15 Most Attractive FDI Destinations According to Corporate Executives
>>> Back to index
5. France
6. Italy
7. Spain
8. Canada
9. Mexico
10. Australia
11. Poland
12. Japan
13. Brazil
14. Czech Republic
15. India
5. Germany
6. Poland
7. Australia
8. Mexico
9. Canada
10.UK
11. UAE
12. Vietnam
13. France
14. Hongkong
15. Bahrain/Oman/Qatar/KuwaitSource :AT Kearney 9
From bad infrastructure to space
>>> Back to index
India on Accelerated Growth Path
Investments Required Over Next 5 Years – More Than US$ 430 Billion
>>> Back to index
Source : Planning Commission Report / DGH / other sources In $ Bn11
2000
2500
3000
3500
Nominal GDP(BUSD)
Exports (BUSD)
India’s Economic Development
>>> Back to index
0
500
1000
1500
2000
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Exports (BUSD)
Imports (BUSD)
• Vast Pool of Skilled Engineers & Designers
• Cost Effective Engineering Man-hours
• Computer Aided Design & Engineering with state-of-the-art
Indian Engineering Capabilities
>>> Back to index
• Computer Aided Design & Engineering with state-of-the-art
Computer Hardware & Software
• Use of 3D Plant Design Software
• Enhanced Basic Engineering Capabilities through Process
Engineering Software
• Capabilities in Specialized Engineering Analysis
13
Indian Manufacturing Capabilities
• Comprehensive variety of systems, equipment & services
• Familiar with all major international manufacturing codes &
Design & Design &
EngineeringEngineering
>>> Back to index
practices• Proven capability of delivering complicated design & engineering, technology challenging equipment and systems
• Globally competitive in terms of quality, delivery & conversion costs
WeldingWeldingMetallurgyMetallurgy
Non DestructiveNon Destructive
TestingTesting
14
India has one of the largest education systems in the world• 311 Universities with over 15,600 colleges,
1500 research institutes• 3 million graduates every year• 200,000 engineers every year• 300,000 other technicians every year
Talent Pool for Knowledge Based Economy
>>> Back to index 15
• 300,000 other technicians every year• 150,000 R&D professionals and 9000 PhDs
every year• 2,000 Graduates from Indian Institutes of
Management and other top 10 Business Schools every year
• 84,000 Graduates from other Business Schools every year
• Research and development base for 100 of Fortune 500 companies
Aspiring young professionals with vision and drive to make India a Strong Nation
Photo: Tata Motors
Even Obama is concerned for competition from India
>>> Back to index
Doing business 2010Ease of doing business (World Bank); 183 economies
Country Ease of doing business Rank
Starting a business
Dealing with construction permits
Employing workers
Registering property
Getting credit
Protecting investors
Paying taxes
Trading across boarders
Enforcing contracts
Closing a business
Norway 10 35 65 114 8 43 20 17 9 4 3
China 89 151 180 140 32 61 93 125 44 18 65
>>> Back to index
Vietnam 93 116 69 103 40 30 172 147 74 32 127
India 133 169 175 104 93 30 41 169 94 182 138
• Rank based on the 10 topics average score, where each topic have equal weight.
A high score (low number) indicates good regulatory basis for business
• Still a challenging country for doing business, due to heavy bureaucracy, different business culture
and large spread in CSR level (child labour, corruption, HES, etc)
• BUT, the framework for foreign companies has improved significantly during the last years
• AND now, the authorities facilitate for foreign investments in most sectors.
Ease of doing business in India – Rank 133 of 186INDIA South Asia GNI per capita (US$) 1,066
Ease of doing business (rank) 133 Lower middle income Population (m) 1,140.0
Starting a business (rank) 169 Registering property (rank) 93 Trading across borders (rank) 94
Procedures (number) 13 Procedures (number) 5 Documents to export (number) 8
Time (days) 30 Time (days) 44 Time to export (days) 17
Cost (% of income per capita) 66.1 Cost (% of property value) 7.4 Cost to export (US$ per container) 945
Minimum capital (% of income per capita) 210.9 Documents to import (number) 9
Time to import (days) 20
Cost to import (US$ per container) 960
>>> Back to index
Cost to import (US$ per container) 960
Dealing with construction permits (rank) 175 Getting credit (rank) 30 Enforcing contracts (rank) 182
Procedures (number) 37 Strength of legal rights index (0-10) 8 Procedures (number) 46
Time (days) 195 Depth of credit information index (0-6) 4 Time (days) 1,420
Cost (% of income per capita) 2,394.9 Public registry coverage (% of adults) 0.0 Cost (% of claim) 39.6
Private bureau coverage (% of adults) 10.2
Employing workers (rank) 104 Protecting investors (rank) 41 Closing a business (rank) 138
Difficulty of hiring index (0-100) 0 Extent of disclosure index (0-10) 7 Time (years) 7.0
Rigidity of hours index (0-100) 20 Extent of director liability index (0-10) 4 Cost (% of estate) 9
Difficulty of redundancy index (0-100) 70 Ease of shareholder suits index (0-10) 7 Recovery rate (cents on the dollar) 15.1
Rigidity of employment index (0-100) 30 Strength of investor protection index (0-10) 6.0
Redundancy cost (weeks of salary) 56
Paying taxes (rank) 169
Payments (number per year) 59
Time (hours per year) 271
Total tax rate (% of profit) 64.7
Norwegian companies in India
>>> Back to index 19
Norwegian companies in India
Growing interest for India from our industry
• Large potentials
• ~60 Norwegian companies established in India already
• ~30 Norwegian companies with agent agreements
• Mumbai has most establishments and agent agreements
>>> Back to index
• Norwegian products and competence are sought after
• Most interesting locations:
• Mumbai, New Delhi, Bangalore, Hyderabarad
• Last 10 years:
• 10 times Norwegian export growth
• 5 times growth in bilateral trade
4000
5000
6000
India – Norway Bilateral TradeMNOK
>>> Back to index
0
1000
2000
3000
4000
1999 2001 2003 2005 2007 2009
Export
Import
Bilateral trade
Overview of Opportunities• Maritime: Shipbuilding, Green Shipping, Coastal Shipping,
JWG Maritime• Energy & Env: Renewable energy, CDM, Water treatment• Oil & Gas: Engineering, Integrated Operations, Subsea,
LNG, JWG Hydrocarbons
>>> Back to index
• ICT: Wireless services, SW development, Outsourcing
Photos: Toyota Motor Thailand Co., Ltd. and Harald Pettersen/Statoil
Maritime JWG Norway - India• Norway would like to establish a joint maritime working group with
India where the goal should be to develop industrial cooperation
between the Norwegian Maritime Industry and the Indian Maritime
Industry. The subjects should be concrete cooperation projects
between Norwegian and Indian maritime industry, including the project
>>> Back to index
between Norwegian and Indian maritime industry, including the project
"Green Shipping India".
• The Royal Norwegian Embassy in New Delhi, in cooperation with MoTI,
is now preparing for launching the maritime working group during
Trond Giske's visit to India 27-30 October 2010.
• We intend to arrange the first meeting in the joint maritime working
group in Oslo during 2011 at a convenient time.
Norwegian companies established in IndiaMaritime sector Oil & Gas
Energy & EnvironmentICT/Telecom Other sectors
1.Aatash Norcontrol
Andromeda Shipping
2.BW Maritime
3.Det Norske Veritas
4.Ebony Ship Management
5.Genoa Maritime Services
6.Goltens
7.GPT Marecom India
1.Aker Solutions
2.EMGS
3.Grosvenor Pumps
4.Insite Solar
5.ION Softnet (Ergo Group)
6.Kongsberg Oil & Gas
Technologies
7.Kongsberg Process
1.Camo Software
2.Conax
3.Corporater Asia
Technologies
4.Digimaker India (Advali)
5.EDB Business Partner
6.Meltwater News
7.Nera Telecommunications
1.DnBNOR
2.EFD Induction
3.Eltek Valere
4.Hydro Building Systems
5.iBruk Consulting
6.Jordan Dental Care
Products
7.Marine Harvest
>>> Back to index
7.GPT Marecom India
8.Hoegh Autoliners
9.Jeppesen Norway
10.Jotun India
11.Odfjell
12.Race Shipping &
Transport
13.Rolls Royce Marine India
14.Vik –Sandvik (eid av
Vartsila)
15.Wallem Ship
Management
16.Wilhelmsen Maritime
Services
7.Kongsberg Process
Simulation
8.Norscot Drilling
9.Norwegian Engineering &
Consulting (NECON)
10.Norwegian Tunnelling
Network
11.Petroleum Geo-Services
(PGS)
12.Rolv Berg Drive India
13.RUE India Subsea
Services
14.SAR Chandra Environment
Solutions
15.Scatec Solar
16.Sevan Marine
17.SN Power Invest
7.Nera Telecommunications
8.NHST Media TradeWinds
9.Norman Data Defense
Sys
10.Opera software
11.Outsmart 360
12.SPAN Infotech (EDB
Group)
13.SureTech International
14.Tandberg (eid av
CISCO)
15.Telenor India
16.Uninor
17.Vizrt India
7.Marine Harvest
8.Maxit (Aventura
Components)
9.Mareva Engineering
10.MTR Foods (Orkla)
11.Orkla India
12.Stepstone (Engelsk
eierskap)
Norwegian companies with agent in India
Maritime sector Oil & GasEnergy & Environment
Other sectors
1.ABB Marine
2.Aeron
3.Air products
4.Kongsberg Maritime
5.Kongsberg Seatex
11.TTS Handling
Systems
12.TTS Energy Bergen
13.BRUDE Safety
14.Maritim Montering
1.Ardee resources
2.Bergen Group
3.Frank Mohn Flatøy
4.Greenfields Internationals
5.IKM Subsea
1.ENWA Water
Treatment
2.Hydrogen Technologies
3.Fugro Oceanor
4.Aries Technical Sales &
>>> Back to index
5.Kongsberg Seatex
6.Norsafe AS
7.Ship Equip
8.Skipper Electronics
9.STX Norway Offshore
10.Team Tec
14.Maritim Montering
15.Anda-Olsen
16.Helseth
17.Kongsberg Maritime
India
18.OSM Maritime
19.Thermtech
5.IKM Subsea
6.Norlense
7.Nortrain
8.TTS Sense AS
4.Aries Technical Sales &
Services
5.Hallvard Lerøy
6.Jash engineering
Strategies for doing
>>> Back to index
Strategies for doing business in India
Strategies for doing business in IndiaInnovation Norway, New Delhi has procured a report on
• “Strategies for Doing Business in India”
• Special emphasis is on;• Intellectual property rights• Technology transfer
>>> Back to index
• Technology transfer• Child labour• Corruption• Establishing an office in India
• The report has been prepared by Vaish Associates, Advocates
The report is available on our webpage:
www.innovationnorway.no/india
Enforcement of Intelligent property laws in India
• An established framework to safeguard Intellectual Property Rights (IPRs)
• Enforcement of IPR is still a problem due to a slow judicial system
involving tedious procedure of trial and conviction.
• By adopting right policies and strategies, IP can be effectively protected
with the help of law enforcement authorities.
>>> Back to index
with the help of law enforcement authorities.
• Strategies and contracts are the most significant instruments for
protection of IPR in India.
• The strategy for the protection and enforcement of IPR shall definitely
include “when to start and end a litigation?”.
Piracy & Counterfeiting in India• Piracy and counterfeiting is rampant world over and so also India.
• An International Chamber of Commerce survey puts India as the third most
unfavorable country for IP environment.
• A report published by FICCI's[National Initiative Against Piracy and Counter-
feiting indicates the magnitude of the problem in India, which is grave
enough to cause alarm.
>>> Back to index
• More or less all industries are a victim of piracy and counterfeiting in India.• 15-20% fake medicines • 40% of music is copied and distributed illegally in India• 37% of automotive parts are copied • 10% of the major soft drinks sold in India are fakes• 10-30 % of cosmetics, toiletries and packaged foods are counterfeited• 60 companies starting with the word ‘Nike’• 65 companies starting with the word ‘Rolex’• 217 companies starting with the word ‘Intel’• 136 companies starting with the word Tata• 400 companies starting with the word ‘Reliance
Strategies for protecting IPR in India
1. Register Intellectual Property Rights; 2. Make IP protection a priority; 3. Implement clear and effective policies and strategies for IP protection;4. Prefer to give a public notice against any violation of your IPR through at least
2 national level newspapers, as such publications are treated as pubic knowledge
>>> Back to index
knowledge 5. Enter into elaborate assignments, licensing or user agreements. 6. Take care to register the IPR in your name and not the Indian entity’s name. 7. Licensing to the Indian Partner is the best policy; 8. Discourage the policy of permissive user;9. Conduct regular due diligence exercise to protect and detect IP violations;10. Determine the risks that your IP faces and watch potential registrations, risks
& violations.
Establishing presence in India by foreign companies
While retaining the status as
a Foreign Company
A Foreign Company may establish its
presence in India by setting up:
While retaining the status as an
Indian Company
A Foreign Company can carry out its
business activities in India by
>>> Back to index
• Liaison office
• Branch office
• Project office
incorporating an Indian Company as a
• Wholly-owned Subsidiary (WOS)
• Joint Venture (JV)
WOS/JV is incorporated and governed by
the provisions of the Indian Companies
Act, 1956 as amended from time to
timef
Liaison OfficeTo explore and understand the
business and investment climate in
India:
• A communication channel between the foreign entity and its present or prospective customers in India
• To establish business contactsand/or gather market information
Permitted to carry out the following
activities in India:
• Representing the parent company in India.
• Promote export import from/to India• Promote technical/financial
collaboration between parent and
>>> Back to index
and/or gather market information• Cannot undertake any commercial,
trading or industrial activity or earn any income in India
• Must maintain itself from the inward remittances received from abroad through normal banking channels. Can neither borrow nor lend money.
collaboration between parent and companies in India.
• Act as a communication channel between the parent company and Indian companies.
• The parent company must prove to have made profit for the last 3 years in its home country and should have a net worth of > 50 KUS$ or its equivalent.
Branch OfficeA BO of a foreign company can undertake the following activities:• Export/import of goods• Rendering consultancy services• Carrying out research work, in which
the parent company is engaged• Promoting technical/financial
• Permission to open a BO is obtained from RBI.
• The foreign entity must prove to have made profit for the last 3 years in its home country and should have a net worth of > US$ 100,000 or equivalent.
>>> Back to index
• Promoting technical/financial collaboration between Indian companies and parent
• Represent the parent company in India and act as buying/selling agent in India
• ICT & SW-development services in India
• Give technical support to products supplied by parent/group companies
• Foreign airline/shipping company
equivalent. • The BO is considered a part of the
foreign entity and is not to be treated as a separate legal entity.
• The profit accruing from the BO, net of applicable Indian taxes may be remitted outside India through an authorized dealer (banker of the BO in India) upon furnishing specific documents.
Project Office• A place of business to represent the
interests of the foreign company executing a project in India.
• No prior approval of RBI is required provided the foreign entity has secured a contract to execute a project in India from an Indian
Conditions for establishing a PO in India;• The project must be funded directly
by inward remittance from abroad, or
• The project is funded by a bilateral or multilateral International
>>> Back to index
project in India from an Indian company.
• If the Right-side conditions are not met, the foreign company must obtain approval from RBI.
=>=>=>=>=>=>=>=>=>• Only permitted to carry out activity
related to execution of the project.• Profits/surplus can be remitted
abroad, net of applicable Indian tax, only on the completion of the project.
or multilateral International Funding Agency (IMF, ADB, World Bank, etc.), or
• The project must have been cleared by an appropriate authority (Ministry or Department), or
• The contract awarding Indian company/ entity must have been granted a Term Loan by a Public Finance Institution (ICICI, IDBI, IFCI, etc.) or a bank in India for the project.
Setting up a wholly-owned subsidiary (WOS) / Joint Venture (JV)
• When a foreign company intends to establish its 100% owned entity,
such foreign company can set up a WOS.
• A JV Company is set-up by the foreign company with one or more
Indian or foreign partner(s). The shares are held by the JV partners in
agreed ratio. • The procedure for setting up a WOS and a JV Company is similar.
>>> Back to index
• The procedure for setting up a WOS and a JV Company is similar. • WOS/JV is the most favored route for foreign companies wishing to establish a
base in India subject to the Government’s FDI Policy • WOS/JV can be incorporated under the Indian Companies Act, either as a
private limited company or a public limited company.• The company will be treated like other Indian companies and enjoys all the
benefits of being an Indian company. • A private company enjoys many privileges against a public company, mainly
because it is exempted from many procedural requirements, which apply to public companies.
Setting up a WOS/JV
Advantages:
• Greater flexibility with respect to the activities that can be carried out in India.
• Limited liability of the foreign company.
Disadvantages:
• Dividend distributed by the subsidiary/JV to the foreign company/JV partner will be subject to dividend distribution tax (16.61%).
• A company cannot distribute its entire profit as dividend because of
>>> Back to index
company.• WOS/JV tax is 33.22%, but for a BO
tax is 42.23%.• Ease of divestment, with minimal
cost, by way of a sale of equity shares to third parties.
entire profit as dividend because of the requirement of the Indian Companies Act, to allocate a certain percentage, not exceeding 10% of its book profit to reserves.
• Closure/winding-up of WOS/JV company is a more time consuming process as it involve several compliances.
• Closure of BO is a speedy process as it requires prior permission of RBI and intimation to Registrar of Companies.
Obtaining Permanent Account Number (PAN)
• PAN is unique alphanumeric combination issued by the Income-tax department.
• Purpose: To identify all financial transactions entered by any business entity in India.
• PAN is mandatory for undertaking any financial transactions including opening a bank account, receiving taxable salary or professional fees,
>>> Back to index
opening a bank account, receiving taxable salary or professional fees, entering into sale or purchase of goods, materials, services and assets.
• Where tax is required to be deducted at source, furnishing of PAN of the recipient has been made mandatory.
• In case PAN of the deductee is not available tax would be required to be deducted at the higher of the following rates:
• 1. at the rate specified in relevant section; or• 2. at the rates in force as defined in section 2(37A);• 3. at the rates of 20 %
Litigation in India• Doing litigation in India may be a long and frustrating process.• The sad scenario of Indian courts (May 2010) can be understood from data
from the website of the Supreme Court of India:• 55.797 cases are pending with the Supreme Court of India• >3 million cases are pending in the 21 High Courts• >26.3 Million civil and criminal cases are pending in the District Courts
• Litigation in India should be initiated only after a well thought strategy about
>>> Back to index
• Litigation in India should be initiated only after a well thought strategy about the entire process, time and cost involved.
• It may not be possible to avoid litigation at all times but strategies can be formed to successfully end the litigation by achieving practical objects.
• It should be kept in mind that Indian Courts are not very pro-active in granting heavy damages or compensation.
• Alternative Dispute Resolutions like arbitration is a well recognised
method of avoiding litigation in India.
Technology transferThere is no special law for Technology Transfer in India. Recommendations:1. Define the Technology to be transferred, in specific terms;2. Define the statutory rights, if any, over the Technology; 3. Define all other IPR which are part of the agreement, 4. Special care should be taken to identify the data, if any; 5. An undertaking should be taken from the transferee that the transferee/licensee acknowledges your
rights over the Technology in definite and unambiguous terms, and that the ownership over the Technology will not be challenged by the transferee;
6. An undertaking should be procured from the transferee that the transferee will not obtain any statutory
>>> Back to index
6. An undertaking should be procured from the transferee that the transferee will not obtain any statutory right over any of the subject matter of the agreement in its own name;
7. Incorporate appropriate terms in your agreement for handling and use of the information provided under the agreement;
8. Make provisions for handling of the subject matter after the termination of the agreement, (return, destruction, erasure of the data from the electronic media or any other medium);
9. A specific bar should be placed on the use of the Technology or Intellectual Property or data etc., after the termination of the agreement
10. Have specific clauses for transfer of the improvements in the Technology and data generated during the use of the Technology under the agreement, to the transferor without any additional cost;
11. Prohibit sub-licensing of the Technology to any third party;12. The Technology transfer agreement should be non exclusive13. Give a notice as to the ownership of the copyright in the format as provided under Article III(1) of the
Universal Copyright Convention
Specific guidelines for foreign entities1. Believe in writing;2. Be specific and avoid ambiguity;3. Before starting relationship prefer to enter into Non Disclosure Agreements (NDA)4. Enter into an elaborate contract;5. Envisage situations and make provisions for termination/revocation of the contract;6. Preserve your correspondence including emails, as emails are admissible as evidence in the
Indian Courts;7. Prefer Arbitration;8. Carefully choose the location of the registered office of your foreign entity in India, which may
be different from your operational offices in India. The registered office of the foreign entity
>>> Back to index
be different from your operational offices in India. The registered office of the foreign entity should be at a strategic location, e.g. New Delhi, as most Courts and judicial forums, Central Government offices are situated there
9. Choose the place of arbitration and jurisdiction of courts carefully;10. Prefer to choose the jurisdiction of the court and place of arbitration, where your office is
situated. 11. To protect your IPR, it is advisable to have an exit clause i.e. a clause to clearly define
procedure for terminating the relationship and conduct thereafter, regarding IPR including all post termination IPR issues
12. The aspect of Technology Transfer in India has to be dealt with through elaborate drafting of agreements otherwise such agreements for technology transfer may prove to be self-destructing. Most of the problems relating to technology transfer relate to secrecy in case of a non-patented technology, transfer, exclusivity, non-compete and termination in case of any dispute.
13. A typical exit clause are given in the “Report on Strategies for Doing Business in India”
Laws and Bureaucracy
• Indian laws and bureaucracy are
quite intricate and cumbersome.
• It is, therefore, advisable to hire an
>>> Back to index
• It is, therefore, advisable to hire an
expert or Indian lawyer or liaison
person, who can help you to
manoeuvre through these intricacies
Indian Business Culture
>>> Back to index
Indian Business Culture
1. Power Distance (PDI)• High PD score:
• Society accepts unequal distribution of
power. People understand "their place"
in the system
• Low PD score:
• Power is shared and well dispersed.
>>> Back to index
• Power is shared and well dispersed.
Society members view themselves as
equals.
• In India there is a high level of inequality
of power and wealth within the society.
• This condition is not necessarily subverted
upon the population, but rather accepted
by the population as a cultural norm.
2. Individualism (IDV)
High IDV score:
• Loose connection with people. Lack of interpersonal connection and little sharing of responsibility, beyond family and a few close friends.
• Low IDV score:
>>> Back to index
• Low IDV score:• Strong group connection and high
amount of loyalty and respect for members of the group. The group itself is also larger and people take more responsibility for each other's well being.
• In India there are loser connections between people, but stronger group cohesion than in Norway
3. Masculinity (MAS)• High MAS score:
• Men are expected to be tough, to be the provider, to be strong. If women work outside the home, they have separate professions from men.
• Low MAS score:• The gender roles are blurred. You see
>>> Back to index
• The gender roles are blurred. You see women and men working together equally across many professions. Men are allowed to be sensitive and women can work hard for professional success.
• The higher the country ranks in MAS, the greater the gap between values of men and women.
• It may also generate a more competitive and self-confident female population, but still less than the male population.
4. Uncertainty Avoidance Index (UAI)• High UAI score:
• Society try to avoid ambiguous (tvetydige) situations whenever possible. They are governed by rules and order. They seek a collective "truth".
• Low UAI score:• Society enjoys novel events and values
>>> Back to index
• Society enjoys novel events and values differences. There are few rules. People are encouraged to discover their own truth.
• On the lower end of this ranking, the culture may be more open to unstructured ideas and situations.
• The population have fewer rules & regulations with which to attempt control of every unknown and unexpected event or situation, as in high Uncertainty Avoidance countries.
5. Long term orientation (LTO)High LTO score:
• Delivering on social obligations and avoiding "loss of face" are considered very important.
• A higher LTO score can be indicative of a culture that is perseverant (utholdende) and parsimonious (svært sparsommelig).
>>> Back to index
and parsimonious (svært sparsommelig).Low LTO score:
• People in the United States and United Kingdom have low LTO scores, meaning that you can pretty much expect anything in these cultures in terms of creative expression and novel ideas.
• People in the US and UK don't value tradition as much as many others, and are likely to be willing to help you execute the most innovative plans as long as they get to participate fully.
Co-existence“Indicates a high level of inequality of power and wealth within the society”.
>>> Back to index
“This condition is not necessarily subverted upon the population, but rather accepted by the population as a cultural norm”.
Indian culture – Key concepts and values
Hinduism and the traditional caste system
• Religion must be respected to maintain successful business relationships. • Despite the elimination of the traditional Hindu caste system attitudes still
remain and still influence the hierarchical structure of Indian business practices.Fatalism
• The notion of Karma and that everything happens for a reason is still significant in the decision making process of many Indians.
>>> Back to index
in the decision making process of many Indians. • Influences the concept of time in India. As a consequence business negotiations
may take longer time and are never rushed.Collectivism
• India’s strong sense of community and group defined orientation mean greater acceptance of hierarchical settings.
• There is a noticeable lack of privacy and a smaller concept of personal space, where several generations often live together under one roof.
• For Indian business practices this places additional importance on interpersonal contacts, avoidance of conflict and a more indirect approach to communication.
Indian Business Culture• India is a diverse and complex country.
• Each person you meet will be unique blend of Indian/Western values.
• People from different states, socio-economic strata, educational
backgrounds, class and religion behave differently.
>>> Back to index
Cultural differences• India is culturally and institutionally very different from Norway
• Interpretation of regulations for overtime, working hours and matters related to
employees influence are different
• The Indian management style is more authoritarian than the Norwegian. It might
be considered unnecessary/improper to ask employees about their opinions
>>> Back to index
be considered unnecessary/improper to ask employees about their opinions
• Indian mangers are considered to be very professional.
• Indian companies have a flat organisation structure, with few manager levels.
• India has a long-term perspective. Based on informal and predictable relations.
• Routinized cooperation contributes to high trust level between employers and
employees, and between people in general.
Business meetings and Contract negotiations• Indians do not jump into business negotiations.
• Prefer to do business with those they know.
• Building relationship is a prerequisite to doing business.
• PowerPoint presentations are accepted to start the discussion. But, you should
send a more detailed proposal before the meeting.
• Indians can't say "No". They will not express their disagreements openly
>>> Back to index
• Indians can't say "No". They will not express their disagreements openly
and directly. That would be considered unpolite
• Relationships & feelings play an important role when making decisions
• Indians take larger risks with a person whose intentions they trust.
One's credibility and trustworthiness are critical in negotiating a deal.
How you should apply Business Culture in your daily operationsContract enforcement:1. The Indian side might consider the contractual conditions to be very
flexible. The contract is just the “Certificate of marriage”, but the daily
life in the marriage could still be very different.
2. Put yourself in a situation where you at all times can control the
>>> Back to index
2. Put yourself in a situation where you at all times can control the
contract/project or reduce the risk.
3. The devil is in the details – so focus on the details.
4. Be problem oriented and always look for solutions. It will not help you
to be very strict in your interpretation of contract articles.
5. Avoid arbitrations or court processes.
6. Do your utmost to solve problems at the lowest level. Lift them to the
next level only when necessary.
CSR in India
>>> Back to index
CSR in India
CSR in INDIA• Most big Indian corporations are engaged in CSR activities.
• Private sector is more active than public sector
• 39% of the Indian population are not literate
• 1/3rd ("demographic dividend“) lives on < 1,25 US$ a day
• BUT India has made a mark on the intellectual world map, and has
>>> Back to index
• BUT India has made a mark on the intellectual world map, and has
the world's third largest, scientific & technical manpower, and is
reckoned as an economic power house
• Inclusive growth is at the centre of India’s national agenda.
A large informal business sector
• 10% of the Indian workforce is employed in formal (organized) companies
• Many of these companies have already implemented a good level of CSR
(HSE)
• 90% is employed by informal (unorganized) companies or are home-based
workers belonging to the vast “Peoples sector”
>>> Back to index
workers belonging to the vast “Peoples sector”
• This sector is used as sub-contractors. A large amount of Indian production
is given to this sector through contractual and sub-contractual arrangements
• This workforce is not covered by Indian protective legislation, has a low level
of education and scarcely implemented CSR systems, including HSE systems
• This sector is also where you find most child labour
Use time and resources to understand and follow up their production
value-chain, especially related to CSR
Child Labour• India has the world’s highest number of child labourers’ under 14 years.• India has ratified following ILO Core Conventions:
• C29 Forced Labour Convention, 1930[2]• C105 Abolition of Forced Labour Convention, 1957[3]• C100 Equal Remuneration Convention, 1951[4]• C111 Discrimination (Employment and Occupation) Convention, 1958
>>> Back to index
• C111 Discrimination (Employment and Occupation) Convention, 1958• The most recent and comprehensive ILO standards on child labour, which are
not yet ratified by India are:• The Minimum Age Convention, 1973 (No.138), and its accompanying
Recommendation (No.146)• The Worst Forms of Child Labour Convention, 1999 (No.182) and its
accompanying Recommendation. • India has also not ratified the following core conventions:-
• Freedom of Association & Protection of Right to Organised Convention (No.87)
• Right to Organise and Collective Bargaining Convention (No.98)
Preventing employment of Child Labour• Enter into specific contracts with the Indian Partners, agents, service
providers and contractors etc. ensuring non promotion of Child Labour
and non indulgence in any illegal practice of child labour;
• Breach of such contracts shall be treated as a breach of contract
leading to termination of the contract with the foreign entity;
• The contract should also provide for the individual liability of the Indian
>>> Back to index
• The contract should also provide for the individual liability of the Indian
Partners, agents, service providers and contractors etc., in case of
breach of contract and employment of child labour;
• The contract should also provide for an indemnity clause in case of
violation of any law relating to child labour; Conduct a due diligence to
ensure that no child below the age of 14 is employed and all Labour
laws and regulations are duly complied with. This is also a norm
followed by various Indian industries.
Transparency and corruption
• Transparency International (TI) Corruption Perceptions Index, 2009 ranks
India as number 84 out of 180 countries.
• Lack of transparency and much “Red tape” in the public sector is a challenge.
Decision processes takes time, and final decisions are delayed again and again
• More than 50% of the Indian people have firsthand experience of paying bribe
>>> Back to index
• More than 50% of the Indian people have firsthand experience of paying bribe
or peddling influence to get a job done in a public office. Taxes and bribes are
common between state borders
• A 2009 survey of the leading economies of Asia, revealed Indian bureaucracy
to be not just least efficient out of Singapore, Hong Kong, Thailand, South
Korea, Japan, Malaysia, Taiwan, Vietnam, China, Philippines and Indonesia;
but it also stated that “Working with the India's civil servants was a
"slow and painful" process”.
Corruption in India• The general perception of corruption in India is that it is deep rooted and a
menace, which has a drastic psychological effect on foreign entities coming to India.
• Accepting bribe is not the only offence but offering and giving bribe is also an offence in India. So getting entangled in any manner whatsoever in the web of bribery, resulting in corruption must be avoided.
• Section 24 of the Indian Prevention of Corruption Act provides immunity
>>> Back to index
• Section 24 of the Indian Prevention of Corruption Act provides immunity
from prosecution to a bribe-giver if the bribe giver makes a statement in a
court of law that he offered bribe, and becomes a witness in a case relating
to bribe against a public servant.
• Offering a bribe is a punishable offence. • An offence relating to corruption is punishable with imprisonment, which
may vary from 5 to 7 years along with a fine.
Anti-Corruption efforts• A number of positive developments in relation to corruption and investments
exist in India today, including:
• The RTI Act. The Right to information act 2005 (RTI Act) has worked as a
powerful instrument to enhance governance transparency, and has led to
changes in the transparency regarding establishment and implementation of
strategies, programmes and laws. The RTI Act grants access to
>>> Back to index
administrative documents within 30 days and has been actively used to hold
public officials accountable for their decisions and to monitor public
spending. The RTI Act is additionally an important tool in regards to
environmental management
• The Supreme Court has taken some bold steps by upholding corruption
charges in cases involving politicians and high-ranking government officials.
• The Government strive to simplify administrative procedures and to reduce
physical encounters with public officials that could open the way for facilitating
payments
Suggestions for avoiding and combating bribery and corruption in India
1. Be transparent and legally compliant;
2. Maintain records of all transactions;3. Follow timelines for compliances;4. Don’t give discounts on your
7. Educate your employees about the consequences of getting involved in corruption in any form;
8. Prohibit offering, giving or acceptance of bribes, gifts,
>>> Back to index
products/services;5. Avoid cash transactions and prefer
the payments through banks;6. Formulate an anti-corruption and
anti-bribery policy, communicate it to all employees and make breaching it a disciplinary offence
hospitality or expenses by employees or other parties involved, which may result in influencing the outcome of business transactions;
9. Prohibit donations to political parties or charities to obtain a business advantage;
10.Get help from higher officials of the concerned departments in case of harassment or demand of bribery for redressal of grievances
Program Business Delegation to India 26-29 October
>>> Back to index 63
26-29 October
Maritime programTuesday 26. October
1100-1530 Visit to Pipavav yard, Gujarat: Gujarat
Wednesday 27. October:
1400-1600 Green shipping seminar no 1:Purpose: Get to know each other
Hotel Trident, Bandra Kurlam Mumbai
1700-1800 Experience Sharing Seminar Hotel Trident, Bandra Kurlam Mumbai
1900-2100 Informal dinner for Norwegian companies in India and the Norwegian business delegates
Hotel Trident, Bandra Kurlam Mumbai
Thursday 28. October, Plenary Session,
1000-1120 Plenary session seminar on Hotel Trident, Bandra Kurlam Mumbai
>>> Back to index
1000-1120 Plenary session seminar on “CSR - Cooperation in a Global world”
Hotel Trident, Bandra Kurlam Mumbai
1145–1400 Maritime Seminar no 2 Hotel Trident, Bandra Kurla, Mumbai
1400-1500 VIP Lunch with Minister Giske on Green Shipping Representatives fromGreen Shipping Group
1500-1700 Green shipping seminar no 2:Purpose: How to proceed towards the first JWG meeting in Oslo 2011?
Hotel Trident, Bandra Kurlam Mumbai
1930-2100 Network buffet dinner hosted by Minister Trond Giske Hotel Trident, Bandra Kurlam Mumbai
Friday 29. October, New Delhi
1300-1630 Presentation of Norwegian maritime competence for the Indian Navy and Coast Guard
Round table conference Hotel Taj Mahal, New Delhi
1730-1830 Business Delegation Summing up & Assessment Hotel Taj Mahal, Delhi
1900-2100 Public Diplomacy Event: Reception/dinner with Norwegian specialties and a cultural program
Royal Norwegian Embassy, New Delhi
Maritime participants on the Giske visit
• DnV• Kongsberg Group• TTS• Eksportfinans• Norwegian Shipowner Association
>>> Back to index
• Norwegian Shipowner Association• Master Marine• Hoegh• Rolls Royce • Ulstein• Wilhelmsen• Marintek• The Research Council of Norway• NME
Oil & Gas program on Integrated OperationsTuesday 26. October
0930-1630 Plans & Challenges, Integrated Oeperations when upgrading existing facilities and expanding deepwater projects on the east coast of India
IO workshop at ONGCSession 1: Enabling technologiesSession 2: Technology solutions based on IO
Wednesday 27. October:
0930-1630 Plans & Challenges for Integrated Operations of Oil and Gas Deep Water Projects on the East coast of India
IO workshop at Reliance Session 1: Enabling technologiesSession 2: Technology solutions based on IO
1700-1800 Experience Sharing Seminar ??? Hotel Trident, Bandra Kurlam Mumbai ???
1900-2100 Informal dinner for Norwegian companies in India and the Norwegian business delegates
Hotel Trident, Bandra Kurlam Mumbai
>>> Back to index
and the Norwegian business delegates
Thursday 28. October, Plenary Session,
1000-1120 Plenary session seminar on “CSR - Cooperation in a Global world”
Hotel Trident, Bandra Kurlam Mumbai
1145–1400 Session 1: Client workshop with GSPC focusing on IO concepts for the East Cost Deepwater Project under Development
Hotel Trident, Bandra Kurla, Mumbai
1400-1530 Lunch Hotel Trident, Bandra Kurlam Mumbai
1530-1800 Session 2: Indian capabilities and needs related to IO in the service industry
Hotel Trident, Bandra Kurlam Mumbai
1930-2100 Network buffet dinner hosted by Minister Trond Giske Hotel Trident, Bandra Kurlam Mumbai
Friday 29. October, New Delhi
1100-1630 Potential IO workshop with clients in New Delhi New Delhi
1730-1830 Business Delegation Summing up & Assessment Hotel Taj Mahal, Delhi
1900-2100 Public Diplomacy Event: Reception/dinner with Norwegian specialties and a cultural program
Royal Norwegian Embassy, New Delhi
IN New Delhi Staff
• Harald Nævdal ([email protected])
• Manager
• Rajeev Koul ([email protected])
• BMMP, Energy & Environment
>>> Back to index
• Asheesh Agarwal ([email protected])
• Maritime
• Tejas Sharma ([email protected])
• Oil & Gas
• Arti Bhatia ([email protected])
• BMMP, CSR, Public Diplomacy, IPR, Business
Culture
Services towards International Markets
• International Growth Program• Matchmaking Program; limited to selected countries• Norwegian Industrial Research and Development
Contracts (IFU)• Business Networks
>>> Back to index
• Business Networks• Navigator programs
Photos: Heidi Widerø/Innovation Norway
>>> Back to index
Thank you
