Q&A with Pradip Madhavji of the India Advisory Board

He has considerable experience and expertise in travel and tourism, having joined Thomas Cook in 1977.

He was the first Indian to lead the company’s operations in India and was the Chairman and Managing Director of the Indian subsidiary for over 25 years.

Prior to joining Thomas Cook Pradip worked for Dena bank where he was in charge of the bank’s entire foreign exchange operations at the time of his departure.

Pradip sits on the Boards of a number of leading companies, is a member of the Paris based International Chamber of Commerce (ICC) in their Air Transport Committee and the Council for Transport & Logistics, is a President or Past President of several professional travel trade and tourism associations and is the recipient of the Kutcha-Ratna, the highest honour bestowed by the community for his leadership qualities and his contribution to the tourism industry.

In 2002 Pradip was appointed the New Zealand Honorary Consul based in Mumbai.

Why is this a good time for New Zealand exporters to focus on India?

The country is undergoing a dramatic transformation offering significant opportunities for high growth New Zealand companies. India has a population of more than 1 billion people, a vast geography and a rapidly growing middle income class.

For example, there are now 200 million plus cell phones in India, something unheard of 3-4 years ago. GDP growth is 9 per cent plus and growing. The economy is robust, with foreign exchange reserves in excess of US$200 billion.

India is a huge market, is there an awareness of New Zealand that can help our exporters get established?

Our countries share community and sporting links as well as common interests and traditions, particularly the language, openness and hospitality of the people.

Bollywood has also discovered New Zealand. All Indians have heard of New Zealand because of your cricket team. When a foreigner comes and speaks cricket in India, he’s your friend.

Where are the best opportunities?

Wide ranging across many sectors. At least 50 percent of the population is now relatively high net worth and there is more and more migration to the cities.

There is a great future for companies that can give support with infrastructure development – airports, roads, ports, rail, water and power. And the construction industry.

The IT sector is going from strength to strength as is the manufacturing sector. Retail is growing very quickly, with large mall construction in towns and cities.

Any products which can be targeted to large scale domestic consumption will do well. Consultancy and training, for example pilot training – domestic civil aviation growth has been phenomenal. Tourism is another high growth area.

What are some of the challenges of doing business in India?

There are states that have independent local governments which means there are local laws and market conditions. While English is the common language, there are linguistic and cultural differences between communities. A product suitable in South India for example, will not be acceptable in a major city like Delhi.

The bureaucracy is still very large and cumbersome – getting permission can take much longer than elsewhere. Corruption is rampant, and while the judiciary is independent, justice is slow.

Indians are very unionised, there are very complex labour laws, and getting rid of employees is said to be more difficult than getting a divorce.

Finding the right people for the right job is difficult, and it’s equally difficult to retain them. There is very little loyalty to the job and company left and there is a shortage of trained, skilled staff.

The financial cost of entering the market and the cost related to delays – regulatory approvals, bureaucratic procedures, permissions, compliance, relatively high property costs in cities, unplanned escalation of costs and the level of corruption.