Talking Shop: India for the world

“I choose a lazy person

to do a hard job. That

is (just) because a lazy

person will always find

an easy way to do it.”

— Bill Gates

For all those who have anything but wholehearted support for the quote above, I can simply suggest that they save me the wisecracks and speak to the protagonist who mouthed these words in the first place. That person, Bill Gates, has achieved all that there is to in business, and then some. Here’s a true anecdote about high school dropouts in the US – confronted by parents and friends, all they have said for decades is: “Look at Bill Gates, he dropped out too.” Well, Gates never finished his undergraduate degree, dropping out of Harvard after three semesters to start Microsoft.

That, however, in no way means that the going was easy for Gates, but then, this column is not about him. We are talking today of India and those who come here to do business, and the travails and hardships that they face. That list, incidentally, does include Microsoft Corp and Gates, just as it does Apple, Google, Meta and other international technology big-guns like Nokia and IBM. All of them have had to face bottlenecks and heartache such as hard-to-come-by approvals and clearances, social and cultural eruptions, taxation and investment struggles, and even national and local resistance just because they are from overseas.

This column is also not about technology firms alone; they have been used only as they are easily-identified examples. Companies large and small find the going ‘different’ in their gestation phase in India, given the country’s myriad peculiarities, challenges and sometimes idiosyncratic policy flip-flops. Nonetheless, they all converge in India as the country offers businesses an opportunity that simply cannot be overlooked or ignored. We are not just the largest market for products of all types, creed and size, we also have the brain-power and muscle-strength to make a telling difference to these companies’ fortunes.

The India Opportunity

There is much more to ‘business magnet’ India than the qualities listed above. The country is perfectly located geographically for firms to expand to; has a consumption landscape that is as variegated as target pockets are deep; has a chameleon-like ability to adapt to changing market conditions; is evolved for digital delivery and payments; has the resilience to withstand market pressures; and the infrastructure to cater to all possible needs of nascent businesses – roads and highways, ports and airports, railways and road transportation, medicine and healthcare, tourism and holidays, and learning and education.

Yet, there are many “been there, done that” entrepreneurs who have outlined their rough experiences in the Indian business landscape, some unexpected. Most find it tough to set up business unless they have done in-depth research and have prepared well, and unless they have a reliable local representative to help navigate the bureaucracy and red tape. “Entering the Indian market and succeeding there requires reliable local partners,” one bluntly wrote.

Interestingly, others admitted that the only reason they set up ‘notional operations’ in India was in order to open a bank account in the country. “Automatic payments are unreliable for non-Indian registered companies, especially for subscription-based models. This creates a service nightmare and the only way out is to have an Indian bank account, which requires a registered Indian company.” That sounds eerily familiar. While Indian bank accounts mean Indian revenues and, therefore, Indian taxes, most MNCs operating in this geography find ways to subvert tax implications by walking the offshore route. Over time, this has led to serious skirmishes with the Government on tax liabilities.

Some other deterrents

Many foreign firms have admitted that despite overtures to modernize systems and processes, the bureaucracy that businesses have to wade through in India is “numbing”. The registration process includes tonnes of paperwork and cumbersome procedures, especially for opening bank accounts, partly due to a crackdown on fraudulent companies registered during COVID. “A challenge is the way documents are handled – approvals require physical documents to be sent back and forth, necessitating the use of physical stamps, rarely used elsewhere. Detailed documentation to prove ownership and residency is a must.”

Others cite a law requiring at least one director to be ‘Indian’, which makes trustworthy partners essential. However, working with local representatives is fraught with pitfalls and works only if companies don’t have a significant physical presence in India. Many use the representative’s office as the registered address and pay them a monthly fee. It is this step, by and large, that brings to the limelight India’s notorious ‘middleman’. Or woman.

For new entrants in the Indian market, what seems to work is word-of-mouth, as existing customers play a key role in raising brand visibility and awareness. Localization is a must, which sees most revamp their branding or product line to suit the Indian market and palate, be it in foodstuff, fashion and beauty products, automobiles, computers and mobile devices. For certain businesses, the only way to get a foot in the door is a reseller program, which leverages word of mouth and ignites demand.

Finally, location is king in India, regardless of where the overseas company hails from. That’s perhaps why most choose Delhi-NCR or Bengaluru – they have the market; rail, road and flight connectivity; are cheaper to start operations in; and boast an abundance of partners.

What can authorities do?

For starters, single-window clearances can actually start benefiting businesses as the name suggests. Tax laws need to be simplified, as also repatriation of revenues and profits, without resorting to Draconian measures and long-drawn legal standoffs. Babudom needs to be kept in check, with frequent audits and manipulation (read ‘extortion’) not resorted to or misused. At the end of the day, we have to remember that this is a great time and opportunity for India, with the world looking at us not just for consumption, but also seeking to find China 2.0, an alternate manufacturing hub to service global needs. Vietnam, Indonesia and Taiwan, to name just a few, are trying to steal the march here, though they have little to counter India in terms of resources or manpower.

It would do well for India to realize that the world is watching, especially just after less-than-ideal elections have drawn to a close. Frequent rail and road mishaps, religious faceoffs in the streets and places of worship, name-calling in buildings that house our elected representatives, undue podium flexing of vocal chords by leaders, repeated altercations with tourists, and inordinate thumping of chests – all of these need to stop. And keeping them stopped must become a habit, a way of India’s life. As Zig Ziglar said: “People say that motivation doesn’t last. Well, neither does bathing. That’s why we recommend it daily.”

PS: India just won the T20 Cricket World Cup. One hopes that all our cricket team members and support staff know how to swim. One doesn’t really want them to get off the flight from the Caribbean with a gleaming trophy in tow, only to swap their aircraft for rickety boats to get away from our airports, right? The world is watching.

The writer is a veteran journalist and communications specialist. He can be reached on [email protected]. Views expressed are personal