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Business Profile:
Business Profile

India has made enormous strides since it achieved independence more than 50 years ago. A controlled development strategy has helped eliminate famines and bring down high illiteracy and fertility rates - and that against a backdrop of establishing the largest democratic system in the world. Since 1991, reforms to economic policy have led to 1998-9 GDP of 6%, in spite of falls in export growth and portfolio investment. Yet now, for a second consecutive year, GDP has underperformed target rates, a slowdown which has affected the activity of the vast majority of sectors, including the results of multinational companies.

The decline of the public sector and liberalisation of the economy have created new spheres of opportunity for both domestic and inward foreign investment, although India still has a long way to go - especially in the area of reducing massive subsidies which have been estimated to exceed 10% of GDP. The news has been less positive for India's once giant business dynasties, which have found their markets invaded by increasing global competition. This, combined with the present economic slowdown and political volatility, has led to low business confidence and high levels of apprehension.

With India's financial centre in Mumbai and its Silicon Valley in Bangalore, Delhi is less of an entrepreneurial player in the Indian market. The capital city's revenue amounts to 17,690 million Rupees as opposed to Mumbai's 47,180 million Rupees. Key sectors are industry and manufacturing, as well as the service sector. Delhi has also benefited from the lead taken by Bangalore in making India's software subsector one of the most dynamic in the world with 1998-9 growth of 56%.

Delhi's city centre businesses tend to be clustered in the central business district around Connaught Place, with secondary commercial hubs at Nehru Place and Rajendra Nagar. Major corporates include Citibank, Standard Chartered and HSBC banks, Arthur Andersen, Price Waterhouse Coopers, Microsoft, Hewlett Packard, McMillan and Penguin.

It has to be said that New Delhi remains very much attached to the days of the Raj in more ways than one: the legacy of its political and bureaucratic culture means that business is still conducted according to the rather idiosyncratic Indian Standard Time. As in the rest of India, however, Delhi is keen to be hooked up to the online world. Hotels and internet cafÉs provide sometimes slow and sporadic connection by satellite, frustrated by the fact that India remains a country where it can be difficult to get a telephone line. Laptops, also, can be used to connect to the internet, but the adapters required for Indian telephone sockets can be hard to come by.

Business Etiquette

The Indian Hindu greeting is to put both hands together as if in prayer and tilt the head forward. Indian women may prefer not to shake hands, although men will be quite comfortable with it. Language is a very political issue in India, with 18 official languages and 1600 minor languages and dialects. Government policy encourages the use of Hindi which is widely spoken in Delhi and the north. English is usually sufficient for most business situations.

Corporate entertaining is an important part of Indian business life, making business lunches and dinners a minefield of potential disasters. The first rule is that Indians eat only with the right hand - the left hand can be used to hold a cup or utensil, but in polite society would not be used to eat or pass food with. Generally, the left hand should not be used to pass anything, nor to point at anyone. Gifts and business cards should be accepted with the right hand - or both at the same time as a sign of respect. The other taboo part of the body is the foot. Shoes should be removed when entering a private home and, when sitting, care should be taken to ensure feet are never pointed at anyone.

Indians are very conservative when it comes to dress, and women should ensure that they are modestly dressed, with legs and shoulders covered. Trousers are acceptable, but short skirts can be offensive. Regardless of how hot it gets, men are expected to wear suits - and should remember the country's British Raj heritage: Indian businessmen still wear blazers for afternoon drinks and dress for dinner. Visitors invited to the hallowed ground of the Gymkhana club, for instance, should bear in mind that anyone not dressed in a jacket and tie is automatically ruled out (and teetotallers are not much favoured either).




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