indian door open to aussie firms

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    ISSUES 2008: Christian Kerr | April 11, 2008
    INDIA is being touted as the new land of opportunity for Australian infrastructure and resource companies, with business opportunities worth more than $50 billion available in the next 12 months.

    "The Australian Government is committed to raising the trade and economic relationship with India to a new level," Trade Minister Simon Crean said yesterday, launching a new Austrade report on business opportunities in India.

    "Australian business has the expertise and capacity to pursue the tremendous opportunities that India presents in the infrastructure and resources sectors."

    Mr Crean said trade between Australia and India had been growing by more than 30 per cent per year, and India was now Australia's fastest-growing export market.

    India has experienced rapid growth, averaging 7.6 per cent over the past five years and 9.4 per cent in 2006-07.

    Indian gross domestic product is projected to grow at 8.7 per cent in 2007-08, a growth rate that makes India the world's second-fastest-growing economy.

    "The Indian Government has identified that, to sustain a growth rate of 8 to 9 per cent over the long term, significant infrastructure development is required," Mr Crean said.

    "Investments in the order of $US500 billion ($536.6 billion) are expected to take place in coming years for developing ports, airports, roads, railways and real estate."

    The report, prepared for Austrade by KPMG India, says the Indian Government is creating an infrastructure policy framework increasingly conducive to private investment, with several opportunities for public-private partnerships.

    The paper says the minerals sector will experience significant growth, driven by overall industrial growth.

    "The size of the metals and mining sector in India has more than doubled to $US45 billion in 2007 from $US20.3 billion in 2001 and a similar pattern is expected to be maintained in the years to come.

    "This will demand increased efforts and investments in exploration and extraction activities," the report finds.

    But KPMG has warned that Australian companies must act swiftly.

    "Some of the larger Australian companies are working in India and some are in the process of entry, but others need to move fast to compete with companies from the UK, USA and Spain which have expertise in this area and are very keen to participate in the Indian market," said Kumar Parakala, KPMG Australia's India business practice national leader.

    Australian infrastructure and resources companies already working in India include Leighton, Hydro Tasmania, BHP Billiton, Rio Tinto, Thiess and BlueScope.

 
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