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The European Union is the main commercial partner of India, accounting for 22 percent of India’s exports and 18 percent of total Indian imports. Amongst its member countries France occupies the 4th place after UK, Germany and Belgium.
The French market has a lot to offer to Indian companies
Garment exporters are getting the most of it: Indian couture has been known in France for many years and new segments keep emerging, such as underwear and lace trims. By the end of 2004, the abolition of textile quotas will give the sector a new impetus.
The French palate has indulged pleasurably in Indian cuisine for many decades. Today, a new breed of sea food exporters are upgrading their products to comply with the latest European standards, and I am sure that in a few years time, many more products from the Indian Ocean will reach our tables.
The next area with great potential for growth could be biotechnology. The generic revolution has boosted the Indian pharmaceutical exports to France and this trend is here to stay and grow.
On the other side, France is supplying India with state of the art technology and equipment, thus contributing to the new investments that take place in the country. These exports have increased considerably in the last decade as a consequence and the dynamism in the IT sector and aeronautics is visible, in particular. In other areas, equipment like sensors and control equipment send the French know-how is reaching right to the heart of Indian industry.
The Indian people have also had a flavour of that trend, as the export of French consumer goods, essentially pharmaceutical products and electronics, is increasing at a very high pace (+30% per annum) in the last two years. Luxury goods, perfumes, wines and champagne also find their way, albeit in smaller quantities, into the Indian market. French luxury brands such as Christian Dior, Baccarat, Daum, Cartier, Louis Vuitton are present in India.
How integrated are our economies?
As a whole, in 2003 India has exported Rs. 7500 crores of goods to France (2% of total Indian exports) and imported Rs. 5000 crores of goods. As a result, the trade with France is generating a commercial surplus in favour of India of Rs. 2500 crores .
Regarding the number of French companies exporting to India, we have been able to count more than 500 French exporters having strong commercial links with India. I am sure that the number of Indian exporters selling to France is even greater.
Some of these companies have invested heavily in India. 200 French subsidiaries are present in India, in almost all industrial sectors of significance. They employ more than 20000 people.
Others have been involved in technical partnerships with private or public sector companies.
Indian companies also tend to invest in France: Two big groups, Ranbaxy and Jindal have recently acquired subsidiaries in France. Wipro has recently announced its intention to create 400 jobs in the next 3 years in France. This is an absolutely new trend that will considerably reinforce our economic partnership.
Information technology & Telecommunications
In the Telecom sector, France has a strong representation through investments made by French majors Alcatel in Gurgaon, Bangalore and Chennai, and France Telecom in Mumbai through a partnership with BPL Mobile and Sema Group, which is now part of Atos-Origin Group and has its own subsidiary in Calcutta for telecom software development.
Some French software and services companies (SSII) have invested in software development activities in India. French majors like CAP Gemini and ATOS Origin have already created subsidiaries in Maharashtra, smaller companies like Transoft International and SGE are present in Bangalore through joint ventures. Others like AXA, Société Générale and THALES outsource part of their software requirements from India, mainly in Bangalore.
France is also a potential market targeted by Indian software companies.
In the vicinity of US$50 millions a year, Indian exports of software services to France are still at a low level. Therefore, a huge potential market remains open for the Indian software industry. Tata Consultancy Services (TCS) has a partnership with a French company in France, WIPRO is opening its own representative office in Paris, Sankhya Infotech has a commercial office in Toulouse, Satyam Infoway is also looking for business opportunities in France and new Indian companies like Netkraft Private Ltd. or Technova Information Systems are gaining a preliminary foothold in the French market.
Building material : cement and glass
Lafarge, is actively present in India since the late 90’s with a 5 percent domestic market share and 21 percent in the Eastern part of the country, where Lafarge’s three plants are located (Chhattisgarh and Jharkand mainly). It is the fourth largest cement producer in India.
The glass manufacturer Saint Gobain, has a long standing presence in India. It has 3 factories in Bohsari, Chakan and Bangalore, and inaugurated in 2000 a brand new float glass plant in Chennaï producing 650 tonnes of glass per day. A new investment of Rs. 500 crores for the implementation of a second line in the Chennaï plant has recently been sanctioned.
Environment & Water
In the field of water treatment, distribution, sewage, urban water management, equipment and engineering, France has a strong presence in India mainly through the two large French majors Suez and Veolia. Since the 90’s, major French players have signed important commercial contracts, such as the construction of the largest treatment plant (Sonia Vihar) in the capital New Delhi, providing drinking water to 3 Million people, which will be operated by Degremont, a subsidiary of Suez group. The French company SCE has undertaken the preparation of a computerised (GIS) master plan for the development of Bangalore.
The environment-related sectors are another prominent field where France has shared its know-how in India. As a fine examples, well reputed French companies, Onyx and Environnement SA are involved in the field of urban waste management (Chennai) and air quality monitoring (West Bengal) respectively.
Road and Railways
In the road sector, France appears to have a pioneering experience in India with the widening of the road network to 4-lane (60 km pathway between Delhi and Jaipur) executed by the big French company GTME in 1997. Several French companies have a strong presence in India in this sector: COLAS, a part of the multinational Bouygues group has been in partnership since 1994 with the Indian group Hindustan Petroleum Corporation for asphalt products ; EGIS group is represented through two subsidiaries, Scetauroute specialising in the construction of bypasses and BCEOM, specialising in feasibility studies, works supervising, impact assessment studies and project managing
The French state owned company SNCF has worked with its partner the Indian Railways since the 1970’s. From the late 90’s, some leading French companies have actively entered the Indian market, either through international tenders (such as COGIFER, GEISMAR, CORYS TESS etc.) or through setting up offices in India (ALSTOM, ALCATEL).
The Delhi Metro Rail project has provided an important opportunity for the sharing of French technological expertise with Indian partners. Thales e-Transaction group (smart card ticketing ), ALSTOM Transport India (signalling and control & security system), SYSTRA (engineering on electrification and maintenance systems, designing of line n°3 and also consulting services for Calcutta and Mumbai metro), COGIFER (tracks switching systems), GEISMAR (electrification, railway maintenance equipment) are all working together with the Delhi Metro Rail Corporation Ltd to implement project with rapidity and efficiency.
At the government level, an Indo-French Initiatives Forum was created, comprising perminent personalities and decision makers from both countries. H.E. the late Ramakrishna Hegde was the first Indian co-chairman of this Forum, while Mr M K Rasgotra currently holds this position. Mr Jean François-Poncet is the French co-chairman of the Forum. The Forum meets regularly, alternatively in Paris and New Delhi.
Seven Indo French Joint Working Groups have been formed to monitor the existing joint projects and to explore new areas for co-operation. The Joint Working Groups cover Agriculture, Mines, Energy, Information Technologies & Telecommunications, Urban Development, Roads & Highways and Posts.
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