opening doors TO INDIA New Zealand’s 2015 vision Opening Doors to India 1

Opening doors to India Foreword from New Zealand’s 2015 Vision Prime Minister key

I’m delighted to introduce the New Zealand Inc India Strategy. Our future prosperity as a country depends on our ability to overcome the tyranny 01 Foreword from Prime Minister Key of distance, connect with the world, and build our exports. 03 India in perspective 07 India’s commerce A stronger export market will help us build legal system, business language, democratic 08 New Zealand and India a stronger economy, which will, in turn, create traditions, sporting passions, and people-to- 12 The NZ Inc India Strategy jobs, boost incomes, and raise living standards people links. for New Zealand families. 13 Goals We strongly value our strong bilateral ties with 13 Grow merchandise exports That’s why New Zealand is taking a whole- India. We look forward to building on our ties of-government approach to building exports in the years ahead, and learning more about – 16 Grow services trade and opening up new markets. This includes and from – India. 18 Improve the bilateral investment framework directing government agencies’ efforts towards key countries and regions over I believe we can build an enduring and 19 Attract and retain skilled migrants the next five years. successful partnership with India that will bring in huge rewards for both our countries 20 Engage more deeply with India This strategy, the NZ Inc India Strategy, is the in the years to come. 21 Raise the profile of New Zealand’s value proposition first. India is emerging as an Asian superpower This NZ Inc Strategy is our first step, 27 Sectors of focus and New Zealand needs to make the most of the opportunities it provides for the future. and I encourage New Zealanders to find 27 Food and beverage, and agritechnology out more by visiting www.mfat.govt.nz Similar strategies for China, the United States, 31 High value manufacturing and technologies (ICT, healthcare) and Australia are also underway. Strategies for For more information about doing business 31 Construction and interiors (including value-added wood products) ASEAN, the Middle East, and the European in India, including market intelligence reports Union are planned. and information about business culture, visit 33 High value services (agriculture, forestry, infrastructure, aviation) www.nzte.govt.nz 34 Tourism The NZ Inc India Strategy outlines why New Zealand exporters should be doing business Rt Hon John Key 36 Education in India and gives them the information they Prime Minister 39 Doing business in India need to get started. The Government’s vision is for India to become a core trade, economic, and political partner for New Zealand by 2015. This is a bold aim, but one which all of Government is working towards.

For example, we are working hard to complete the India New Zealand Free Trade Agreement (FTA) in 2012. This FTA has huge potential to benefit both our countries.

New Zealand and India already have much in common. We share a Commonwealth heritage, Opening Doors to India 3

India in Perspective

With more than 1.2 billion people, India is one of the world’s largest economies. In nominal terms it is currently the world’s 10th largest economy (US$1,685 billion).

India is a country of diversity. It has 28 states, There are 2.65 children in India for every seven union territories, and numerous official woman of child-bearing age and with 64 percent languages. It is also a country of significant of the population currently aged between 15 and change, growth, and urbanisation – by 2030 it 65, India has the world’s largest working age is expected that India will have 68 cities with population pool. According to the International populations of more than one million people. Monetary Fund, this demographic dividend could add about two percentage points per annum to India’s per capita GDP growth over “By 2012, [India] will have overtaken the next two decades. Japan to become the world’s third largest Indian people are becoming more widely educated and the liberalisation of the economy economy, with GDP accounting for 5.8% has given rise to a vast collection of self-made millionaires. This is a nation where staggering of the world total in PPP terms. In the wealth and prosperity thrive side-by-side long-term, India could grow even faster with a rural economy. Around 60 percent of the population lives rurally but there is rapid than China due to its younger and faster urbanisation and special economic zones in major cities have proved pivotal to development. growing population.” Euromonitor India is using some of its newfound wealth Even during the global recession India fared to invest in the education of its young people. well, with annual growth of over five percent, While only 63 percent of adults are literate, and it is projected to return to more than nine among India’s youth this figure is 78 percent. percent, in line with its performance over most Already there have been striking advances in of the past decade. addressing literacy. There are now around 350 tertiary institutions in India, including the In August 2007, the McKinsey Global Institute Indian School of Business which was ranked predicted that “over the next two decades, the number 12 in global MBA rankings by the country’s middle class will grow from about Financial Times of London in 2010. India’s 100 five percent of the population to more than million-plus English speakers are a huge asset 40 percent and create the world’s fifth-largest as it develops into a global economy. consumer market.” So far, that prediction is proving sound. Education constitutes 20 percent of India’s current budget for economic development, India’s greatest asset is its youthful and with a total outlay of about $81 billion. This increasingly educated population. substantial investment is improving the Clockwise from top: Taj Mahal (photo courtesy of WG-ST), spice market, Prime Minister Key in India with . Cities on the move: the transformation of Pune and

India is simply too large a market to approach in anything other than small sections, whether it be politically, institutionally, or geographically. Opportunities in India abound beyond the sprawling mega-cities of New Delhi and Mumbai and New Zealand companies should be looking at other tier one, two, or three cities as part of their market entry strategy. Some of India’s more ambitious cities offer healthy prospects for savvy businesses; two examples of upcoming cities are Pune and Hyderabad.

pune

The transformation of India’s eighth companies such as Tata Motors, Mahindra largest city into a major industrial hub and Force Motors (Firodia-Group) have also has attracted attention around the world. set up in Pune. Known as a centre of education, Pune is located 150 kilometres from Mumbai, in A number of IT parks have been the western state of Maharashtra, and is established to accommodate the city’s home to 5.5 million people. The city boasts swelling software industry, which employs the second highest per capita income in more than 70,000 people. Major software companies such as Infosys, Symantec, Clockwise from top left: the country. Tech Mahindra and IBM Global all have a Charminar in Hyderabad, Pune’s growth can be attributed to three presence in Pune, and Microsoft is planning The Ganges near Varanasi, areas: ICT, small and medium engineering a US$156 million project in Hinjewadi, on the and a Mughal tomb component manufacturing, and automobiles. outskirts of the city. (photo courtesy of WG-ST). All sectors of the automotive industry are In addition, a high-speed train is being built represented, from two-wheelers and auto- to connect Pune to Mumbai which will reduce rickshaws to cars, excavators and trucks. travelling time to just one hour, and the The Independent once dubbed Pune India’s state of Maharashtra is reportedly planning “Motor City” thanks to the proliferation of a 1000MW power plant to exclusively big-name international auto companies, cater for Pune’s rapid expansion. There is a such as Daimler, Chrysler, Volkswagen, strong New Zealand link with Pune as well, Fiat, and Mercedes Benz, that have set with BLACKCAPS and Nathan up manufacturing or greenfield facilities McCullum playing for the Pune Warriors in in and around the city. Indian automotive the 2011 (IPL) series.

hyderabad quality of elementary education, recruiting additional teachers (particularly in science “India is one of the world’s best-performing With a population of about six million with the likes of Kellogg and Wharton and mathematics), upgrading ICT in schools, people in the Greater Hyderabad Municipal and attracts local students and and using technical assistance to strengthen economies for a quarter century. In the region, the capital of the state of Andhra international talent. educationally fragile states. The next Five past two decades, the size of the middle Pradesh offers numerous opportunities Year Plan (2012-2017) is expected to further With a new airport, Hyderabad is for New Zealand companies. Hyderabad increase government spending on education becoming a regional aviation hub and class has quadrupled… and one percent is home to a sizeable “Tollywood” Telugu and continue to promote the public-private is developing this sector as one of its film industry which has shot some films in partnership model of education infrastructure of the country’s poor have crossed the specialisations. Dairy, meat processing, New Zealand, and the largest studio complex and capacity building. biotechnology and agritechnology also in the world, Ramoji Film City, is located on poverty line every year.” offer a good fit with New Zealand the outskirts of Hyderabad. Respected Indian commentator Gurcharan Das capability. Hyderabad is the home to Hyderabad is also known for its sizeable national companies including the pharmaceutical and entertainment Dr. Reddy’s Lab, Mahindra Satyam, and GVK. industries, as well as IT and IT-enabled GMR Group, which is working with the likes services, albeit smaller than Bangalore’s of Glidepath, originated in Hyderabad, and but with lower operating costs. Apollo Hospitals – the largest private public hospital operator in India – is located Microsoft’s India Development Centre is there. Hyderabad is also poised to become a based in Hyderabad. The Indian School world-class hub for advanced semiconductor of Business based here has an association and electronics manufacturing. Indian space venture – the Chandrayaan 1 liftoff Opening Doors to India 7 (photo courtesy of ISRO).

India’s Commerce

The Indian economy is largely driven by the domestic market and the rise of consumerism. Its transformation is particularly focused within the following areas: the food supply chain, consumer lifestyle, industry, infrastructure, innovation and skills. There are significant opportunities for New Zealand companies.

Modern India is a car manufacturing hub now have Indian manufacturing plants and has three Antarctic research stations, a and the Indian corporate giant Tata owns space programme, a large agricultural sector, Jaguar and Land Rover. diversified industry, and a sophisticated Infrastructure problems are the biggest financial and service sector. obstacle to the full realisation of the country’s Over the past decade India has capitalised on economic potential. India’s ports, roads, and rail its wealth of well-educated, English-speaking network need massive capital investments and workers to become a major exporter of software power shortages continue to be a factor. and business process outsourcing (BPO) services Bureaucracy, labour market rigidities, and and resources. Global research group Gartner regulatory and foreign investment controls estimates India’s BPO sector will make US$1.4 are also constraining economic growth. billion in 2011. In India, is both a lucrative and hugely India is establishing itself as a global force in influential sport. Some 70 to 80 percent of global influential sectors such as the auto industry cricket revenues are generated by and in India. and is now the world’s largest auto-component Business commentators estimate the net worth manufacturer. Hyundai, Renault, and Ford all of the IPL to be around US$3.7 billion.

“Rather than adopting the classic Asian strategy – exporting labour-intensive, low-priced manufactured goods to the West – India has relied on its domestic market more than exports, consumption more than investment, services more than industry, and high-tech more than low-skilled manufacturing.” Respected Indian commentator Gurcharan Das 8 Opening Doors to India

New Zealand and India Sir Edmund Hillary went up the Ganges India is an increasingly key player in global and regional political, security and River in a Hamilton Jet in the late 1970s economic discussions and negotiations, and our two countries have a shared (photo courtesy of Hamilton Jet). stake in Asia’s stability, security and prosperity. HAMILTON JET

New Zealand and India have enjoyed long- Governor General Sir Anand Satyanand Hamilton Jet is the world’s largest Shearer says having an appreciation for standing and warm relations. Our historical ties received the Pravasi Bharatiya Samman Award manufacturer of water jet propulsion how business is done in India is the first stretch back to when Indian migration began (Global Indian of the Year). in the 1890s and the Gallipoli landings in 1915. systems. Its water jets are installed in step to being successful. There has been a steady flow of high level visits high-speed marine vessels around The founder of modern India, Mahatma Gandhi, “You need to take time to understand in both directions, and, in 2011, Rt Hon John the world. is an admired figure in New Zealand; and Sir the hierarchical business practices and Key was the sixth New Zealand Prime Minister Edmund Hillary’s legacy as Everest pioneer and Recently the company rekindled an old realise early on that it requires a certain to visit India since formal relations began. Ganges adventurer is also well known in India. relationship – with India. Hamilton Jet sold commitment in terms of resources. When The acknowledgement of New Zealanders by New Zealand also wants to work with India its first boats there in 2000 after working we started we didn’t recognise the fact the Indian government is another sign of the to ensure greater momentum in the East Asia with a distributor who helped establish a that we personally needed to have enough strength of the relationship between the two Summit, to further its political, security, relationship with the Indian Navy. After resources to be able to spend time countries. In 2008, Sir Edmund Hillary was and economic agenda; to advance the that association ended, Global Sales and physically in India.” Marketing Manager Mike Shearer says it posthumously awarded the second highest Comprehensive Economic Partnership in In addition he says it’s important to took a long time to find a new partner and Indian civilian honour, the Padma Vibhushan, East Asia (CEPEA); and in settings such recognise the level and depth of personal re-establish the relationship. and in January 2011, New Zealand’s former as the ASEAN Regional Forum. relationships that have to be nurtured. Sir William Hamilton designed the “It’s a unique business environment. We had New Zealand AND INDIA TRADE FIGURES innovative jet propulsion system in the to learn to foster personal relationships with 1950s using a 2000 year old principle first business partners while at the same time described by Archimedes, and in 1977 maintaining the ability to be fairly tough. PLASTIC $11.4m Sir Edmund Hillary led an expedition with You don’t want to be thought of as naive.” EXPORT TOTAL: $917 MILLION his son Peter to the source of India’s sacred CLOTHING $15.6m Ganges River using the Hamilton Jet boats. Hamilton Jet doesn’t currently have an office in India but is considering the option, COAL $322.6m TEXTILES $18.2m But the company realised that its rich and as a particular challenge the company faced iconic heritage was not something the WOOD $196.3m MACHINERY $19m was finding a suitable professional partner company could use to trade on. to work with, especially from a distance. DAIRY $136.9m PRECIOUS METALS $39.1m “It’s a heritage we are proud of,” says Shearer says the market in India has the Shearer, “but it’s not actually something MACHINERY $76.4m MEDICINES $47.4m potential to be bigger for Hamilton Jet we use because it can be difficult, especially than all of South America. However, it’s WOOL $44.1m in the government sector which tends to a unique market and a whole new way IMPORT TOTAL: $369 MILLION rotate every three years. It’s more important of doing business. HIDE/SKINS $29.2m to have the ability to get in front of the right people.” www.hamjet.co.nz

Source: Statistics New Zealand (for the 12 months to March 2011) “Three quarters of India’s consumer market in 2025 doesn’t exist today. $1.32 trillion… …a year in future purchases is up for grabs.” India mega-retailer Future Group 12 Opening Doors to India Opening Doors to India 13

The NZ Inc India Strategy Goals

This country strategy is the first of its kind. It is part of a broader strategy to The NZ Inc India Strategy identifies six strategic goals for furthering increase the internationalisation of the New Zealand economy which, in turn, New Zealand’s ambitions for its relationship with India. Each goal is focused, is part of the wider Economic Growth Agenda. It supports the Government’s demanding, and precise, a benchmark against which success can be measured. main goal to deliver greater prosperity, security and opportunity for all New Zealanders. 1 Grow merchandise exports to at least Several key steps to implement this strategy are already underway. They include: The strategy is part of a whole of Government with India, and more targeted and cohesive $2 billion by 2015. approach to growing exports and new markets. services to help successful businesses develop 2 Grow services trade with India by •  re-launching the bilateral relationship at the and grow in India. The strategy, however, goes highest political level through Prime Minister The NZ Inc India Strategy reflects India as an an average of 20 percent per year. far beyond increasing exports. It identifies John Key’s state visit to India in June 2011 important bilateral partner for New Zealand. issues that impact on New Zealand’s ambitions: 3 Improve the bilateral investment It has a strong trade and economic focus and improving capital markets, fine tuning framework and facilitate growth in • negotiating the New Zealand-India FTA sets out ambitious, high-level five-year goals New Zealand’s immigration policy, international the investment relationship. and reducing trade access barriers and actions to achieve them. education policy, and the need for direct air 4 Attract and retain skilled migrants • engaging with Indian business lobbies The strategy also provides an overview of our links between both countries. from India who are able to make an to strengthen our FTA constituency strengths and, at times, a frank admission of effective contribution to New Zealand’s weaknesses in New Zealand’s overall approach. New Zealand 2015 vision • developing action plans for key sectors economic base. As international competition for India’s using cricket diplomacy to promote It focuses on key sectors and identifies • attention intensifies, New Zealand must draw 5 Engage more deeply with India New Zealand business and pathways to superior long-term performance. India’s gaze. The vision for the NZ Inc India on regional and global issues that The strategy has been developed by ministers Strategy is that by 2015: will impact on New Zealand’s future • investigating air links. and government agencies with important prosperity and security. private sector input from industry groups, “India will become a core trade, economic 1 Grow merchandise exports businesses, and organisations involved and political partner for New Zealand” 6 Raise the profile of New Zealand’s value to at least $2 billion by 2015 in building New Zealand’s relationship in India through a series of Pivotal to this is achieving a Free Trade proposition New Zealand’s exports to India are growing with India. Agreement (FTA) with India. This will conscious steps, from enhanced cricket rapidly, and India is currently New Zealand’s diplomacy to increased political contact A central aim of this strategy is greater require the drive and energy of businesses seventh largest export market, earning efficiency and effectiveness across all working collaboratively with NZ Inc with India. $917 million in the year to March 2011. government agencies. government agencies that work in and Underneath each goal is a series of actions This figure reflects significant growth in recent and priorities that will be led by Immigration years – only three years ago India was this New Zealand, the Ministry of Education, the country’s 24th largest export market. India with its huge economy and projected population Ministry of Foreign Affairs and Trade and To achieve the goal of growing merchandise New Zealand Trade and Enterprise. growth offers: “a land of limitless opportunities”. exports to at least $2 billion, New Zealand must: Minister of Commerce and Industry, Anand Sharma Other agencies working closely on actions and priorities include the Ministries of Agriculture Complete a Free Trade Agreement and Forestry, Science and Innovation, Defence, (FTA) with India Economic Development, Culture and Heritage, The rapid growth in New Zealand’s exports to Transport, Tourism New Zealand, Customs, India could provide increased value if an FTA and the Department of Internal Affairs. liberalised India’s severe tariff and non-tariff 14 Opening Doors to India Opening Doors to India 15

“India is on the verge of becoming a great power and the swing state in the international system. As a large, multi-ethnic, economically powerful, non-Western democracy, it will play a key role…” mainfreight limited C. Raja Mohan in Foreign Affairs Magazine Mainfreight Limited is a global supply chain “We want to make sure we’ve got the right logistics provider, with businesses operating partner. Once we pick that company, that’s barriers. The scale of demand is huge and Just eight companies are responsible for in 186 branches throughout New Zealand, a relationship for life for us.” similar to China’s and the completion of an three-quarters of New Zealand’s exports to Australia, Europe, Asia, and the United States FTA is a central element of New Zealand’s India. There is an opportunity to develop the of America. Established in 1978, Mainfreight Braid says there is a genuine opportunity for overall trade strategy. export potential of about 700 companies. The has sales of $2 billion a year, employs over New Zealand products and services, but he lack of depth here is a significant weakness for 4,600 people, and has in excess of 30,000 warns that Kiwi businesses have to enter the Protecting our existing commodity New Zealand. Addressing this will not be easy customers worldwide and more than market with a sharp focus. based trade and will take time. 4,300 shareholders. “You need to be focused on what you can While FTA aspirations are of critical To do this, New Zealand government agencies Don Braid, Group Managing Director, sell or what you can do. Over-promising importance, it is also crucial that will work to raise the profile of India as an says India is Mainfreight’s “next China”. and under-delivering is not going to cut New Zealand remains focused on protecting export destination among New Zealand The schedule for moving into India has it in that market.” current commodity exports – namely coal, businesses, educate potential exporters in been accelerated following the 2011 trade logs, wool, and, increasingly, dairy. Trade He also says NZ Inc is a key strategy for Indian business culture, and develop sector mission. Braid says the mission convinced threats and problems occur routinely. These success. “We need to move as a country. strategies in key areas of opportunity (see him there was no time to waste in finding will continue to require expert management. Together, united, the brand of New Zealand the right partner. page 27 for more information). has a big job to play in attracting the Indians Boosting non-commodity exports New Zealand needs to better understand Indian www.mainfreight.com to New Zealand trade.” About 350 New Zealand companies are already business culture in order to grow business exporting to India, with a similar number opportunities and build relationships. In any interested in doing so. However, most of these strategy it is important to recognise weaknesses Federation of maori authorities companies are small and occasional exporters. and areas in which New Zealand underperforms. Traci Houpapa is Chair of the Federation communities. Maori understand the emphasis of Maori Authorities (FOMA), which was Indians place on developing a relationship tourism: indian visitors to New Zealand established 25 years ago to promote and of trust and confidence as the basis for advance the sound management of Maori an enduring business association. Such authorities and economic development. commonalities need to be underlined in the 2006 20,265 fierce global competition for India’s attention. Houpapa says New Zealand would be remiss 2007 21,853 to neglect what Maori-owned organisations, Beyond that, New Zealand needs to Maori beliefs, and Maori culture could add understand the strong branding opportunity 2008 23,860 to a relationship with India. “For Maori and Maori culture offers in terms of establishing Indians, there are a number of commonalities a foothold in India. “The interesting thing 2009 25,336 in terms of culture.” about New Zealand is that it has tangata whenua, it has Maori. It’s a huge brand and These include an intergenerational focus, a 2010 marketing opportunity.” 29,486 long-term business horizon, and a clear desire to build wealth and benefit for families and www.foma.co.nz Source: Statistics New Zealand (for December year end) 16 Opening Doors to India

However, we also have areas of strength to Education New Zealander Stephen Fleming has build on. We have a substantial community Over the past six years, the education coached the , of New Zealanders of Indian heritage and relationship with India has gone from strength women riding the Pune train also aspects of Maori business culture to to strength. New Zealand and India renewed (photo courtesy of WG-ST). draw from. their Education Cooperation Arrangement in 2010, and during Prime Minister Key’s visit to New Zealand needs to carefully balance the hubs of Rotorua and Queenstown; and they stay 2 Grow services trade by India in June 2011, he announced an agreement between India and New Zealand to progress marketing of education services to India, seeing longer and spend more per capita than many 20 percent per year a joint Prime Ministerial Education Initiative India as an important source of quality students other nationalities. There is great potential for New Zealand’s between the two countries. and prospective migrants, and as a long-term The great natural assets we have to attract services trade with India, but analysis reveals partner in education cooperation activities. New Zealand is one of a dozen countries India Indian travellers are obvious, but so too is our significant weaknesses in our assets and in This requires a more sophisticated approach is particularly keen to work with in terms of than just promoting New Zealand as an fundamental weakness: there is no non-stop air our approach. The most obvious competitive education, and maintaining our relatively strong education destination. link between India and New Zealand – travellers sectors at this stage are education, tourism, profile at the political level will be necessary must transit through Australia or Asian hubs and professional services. to ensure profile and access. Quality of education and the safety of such as Singapore, Kuala Lumpur or Hong Kong. young people are concerns everywhere. This represents a constraint on trade, business In international education, they are crucial. Universities New Zealand people and international students. This is a very sensitive area with considerable reputational risk around it. The Government Derek McCormack, Chair of Universities room for New Zealand education providers to Professional services will work intensively with education providers New Zealand and Vice-Chancellor of help train some of the large number of Indian to ensure we can offer young Indian students in Over the next 15 years, there will be massive Auckland University of Technology, says graduates who will be required in coming competition for the US$1.2 trillion worth of that although India is New Zealand’s third our country a safe and high-quality experience. years to service India’s swiftly expanding infrastructure required in India’s cities. largest source market for international business sector. New Zealand’s large engineering consultancies students, there is potential for New Zealand Tourism are aware of the market and are assessing universities to develop much stronger He cautions that New Zealand has to take The strong Indian economy, high consumer engagement in the market. care to ensure Indian students are placed confidence, and a willingness to spend on travel opportunities. An FTA might provide a in high-quality courses and are receiving is resulting in an increase in outbound travel platform for professional services companies “We need to make further contact with the best possible New Zealand education from India. to reconsider India as a market where they some Indian agencies, and build up stronger at reputable institutions. Top-flight Indian could grow. relationships with university networks.” Indian tourists are of exceptional value to students learning alongside ambitious New Zealand’s tourism industry. They prefer With a concerted push to develop our relationship, McCormack says there is opportunity for New Zealanders could create rich friendships to travel in New Zealand’s low season, creating India could represent a huge opportunity for a range collaboration in areas such as joint research and future business networks that could a welcome boost for the sector; they prefer free of New Zealand-based niche service providers. and student or staff exchanges. There is also benefit both countries. and independent travel, which means they Clustering of niche service providers within sectors spread their spending beyond the main tourist will also be important for gaining a foothold. 18 Opening Doors to India Opening Doors to India 19

India was ranked 134th in the 2011 Ease of Doing Business ranking. New Zealand ranked third, behind Singapore and Hong Kong. Chad came last, ranked 183rd.

The coordinated effort by the New Zealand aviation New Zealand was valued at $105 million in Outward investment 4 Attract and retain skilled migrants sector is a good example of how this can work. 2010, an increase of around 95 percent from a Investment by New Zealand companies in from India very modest base in 2009. Indian companies India is sparse but growing, and in the two In the year to June 2011, India was one of the 3 Improve the bilateral investment are primarily investing in our ICT and coal years to 31 March 2010 doubled to $129 million. largest sources of permanent arrivals to framework and facilitate growth resources, and there is interest in biotechnology Outward investment primarily involves a few New Zealand. in the investment relationship and pharmaceutical products. dynamic New Zealand manufacturing and services companies that identify India as a high New Zealand needs to attract and retain more Foreign Direct Investment (FDI) and Leading Indian ICT companies such as HCL, growth market, including the likes of Rakon skilled Indian migrants who can contribute to international trade are becoming ever more Mahindra Satyam, and Tata Consulting with their manufacturing and technology New Zealand’s prosperity. closely linked to global supply chains. We can Services have made strategic investments in partner and Medtech Global’s R&D centre. be certain that India will become a much more In many ways, our shortages perfectly New Zealand, which we would like to see grow important player in both inward and outward Policy framework complement India’s excess: while India given India’s known strengths in the ICT sector. has the deepest software labour pool in the FDI flows. An FTA with a comprehensive, high-quality For example, Tata Steel is operating from eight world, the growth rate of several New Zealand outcome on investment would provide Inward investment locations in New Zealand after the acquisition of software companies is constrained by lack a significant opportunity to advance the of software engineers. New Zealand has a weak record of attracting Corus in 2007. Some companies have also shown investment policy agenda. From New Zealand’s investment from India. Official records show interest in the use of New Zealand’s iron sands perspective, such an outcome would include With demographic changes in New Zealand, the stock of investment from India into as an alternative to iron ore. disciplines and protections which affirm, there is a need for skilled migrants to contribute amongst other things, the principle of non- to our labour force and help lift productivity discrimination and the ability to transfer rates. India could continue to be a significant aviation New Zealand payments and investment capital freely to and source of skilled migrants and qualified young from India. people who will stay in New Zealand and Aviation New Zealand connects customers John Nicholson, CEO, says: “In terms contribute to the labour force. New Zealand has a double tax agreement with to New Zealand capability in training (pilot, of building the relationship, that regular India, which was concluded in 1986 and updated Immigration New Zealand has made a cabin crew, engineering), general aviation, contact seems to be very critical. It gives you momentum.” in 1999 and has proven to be a useful component considerable effort to meet the challenge of maintenance, repair and overhaul, and airport of the bilateral economic relationship. the Indian market and now has 54 staff based fit-outs and services. It also encourages Although the potential in India is obvious, Discussions with India are currently in in India (including locally engaged and collaboration to ensure the scale that Nicholson says business leaders are well progress, with a view to a further update seconded staff). international customers require. Aviation advised to spend wisely as they research the of certain administrative provisions. market and establish a presence just in case The New Zealand Government has approved New Zealand represents 65 businesses, which New Zealand Trade and Enterprise will that potential is never realised. pathways to gain residence, which should collectively generate $10 billion in economic continue to be proactive in identifying encourage higher-level study by international activity, including $4 billion in exports. www.aviationnz.co.nz both inward investment opportunities for students, including those from India. Indian businesses and outward investment opportunities for New Zealand companies. 20 Opening Doors to India Opening Doors to India 21

“India’s economic growth rate is expected to surpass nine percent over the next three years, despite the challenge of rising inflation, regulatory hurdles and inadequate infrastructure. With one of the youngest demographics in the world, robust domestic consumption and a growing middle class, 5 Engage more d