German Companies Optimistic About Business in India, Says Stefan Halusa
New Delhi, India – Stefan Halusa, Director General of the Indo-German Chamber of Commerce, expressed excitement about India’s economic development. He noted that German companies are very optimistic about their business prospects in India.
Survey Insights
During a meeting on Friday, German embassy officials discussed the German India Business Outlook survey conducted by KPMG. The survey revealed that over 80% of German companies expect increased revenues in India over the next five years, with 74% anticipating higher profits.
According to the survey, 78% of companies foresee rising sales, and 55% predict higher profits. Looking ahead, 82% expect increased turnover, and 74% expect higher profits within five years. By 2029, 37% of respondents anticipate sales growth of over 20%, and 25% expect profit growth of more than 20%.
Current Presence and Challenges
Halusa highlighted that around 2000 German companies are currently operating in India, particularly in sectors like automobiles, automotive supplies, engineered solutions, electric chemicals, and pharmaceuticals. However, he mentioned that the complexity of licenses and changing state rules pose challenges, especially for companies operating in multiple locations.
Trade and Investment
Bilateral trade between India and Germany reached a record high of EUR 30.8 billion in 2023. German companies’ direct and indirect investment stock in India also hit a new high of EUR 23.9 billion in 2022. The survey indicated that 59% of companies plan to expand their investments in India over the next two years, attracted by low labor costs, political stability, and skilled workers.
Despite challenges like bureaucracy, corruption, and a complex tax system, German companies remain confident about their long-term prospects in India.
Future Collaboration
In the recent edition of AHK, the business magazine of the Indo-German Chamber of Commerce, Halusa mentioned industrial innovation and workforce development as key collaboration areas. He noted that India’s expanding industrial sector will need a large pool of skilled workers, while Germany faces a shortage of skilled labor and educational deficits among its youth.
