South West businesses set their sights on India for international expansion
As negotiations around a UK-India Free Trade Agreement (FTA) draw closer to completion, new research from Grant Thornton UK LLP’s Business Outlook Tracker finds that India is a core focus international growth market for the South West’s mid-market.
The firm’s Business Outlook Tracker, which surveyed mid-sized businesses in the South West, found that more than one third (36 per cent) are planning to invest more in international growth in the next six months, and 73 per cent have their sights set on India.
The South West’s mid-market is already familiar with doing business in India, 68 per cent of the businesses surveyed have an established presence. Of these, almost all (97 per cent) have plans to expand, nearly nine in 10 businesses within the next two years.
79 per cent of respondents agree that an FTA with India is likely to encourage their business to explore more opportunities there.
The top three benefits for the mid-market identified by the research are a large working age population, access to large population of highly skilled workers, and a large consumer market.
The biggest barriers identified by the research are a vast fragmented market with varying regulations, rules and policies and cultures, high tariffs and protectionist policies, and infrastructure.
Jonathan Riley, practice leader for Grant Thornton UK LLP in the South West, said: “India is now the fifth largest economy in the world and is predicted to become the third largest by 2030. It therefore presents a huge opportunity for growth for businesses in the South West.
"As the country is only set to continue to grow, it is an excellent time for both those with an existing presence, and those looking to India for the first time, to be exploring potential opportunities in this market.
“With the uncertain geopolitical situation at the moment, India offers a stable and certain economic environment for investors and businesses, with, not only a fast-growing economy, but also a large working age and consumer population.
“The anticipated UK-India Free Trade Agreement should also help propel the relationship between the two countries further and provide an excellent platform for further investment.
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"An FTA should reduce tariffs and duties to allow for a more level playing field for overseas businesses and give greater access to a large and fast-growing market. It should also allow for the relaxation of certain regulations and help improve the ease with which businesses in the UK can look to do business with, or within, India.
“While our research has identified the biggest challenges many businesses face when setting up in India - as there are challenges looking to grow internationally anywhere in the world - there is support available. The Department for Business and Trade provides support to those seeking to trade or invest in India, while firms, such as ours, can also provide tailored support for businesses exploring new markets.”
