Food, Cars, Electric and Electronics
Promising in India with Population of 1.3 Billion
Korea is behind the United States, China and Japan in IT, telecommunications, e-commerce, smart
city, etc… government supports are required ？
It appears that it is promising
for Korean manufacturing areas such as packaging materials, processing
machines, automobiles, electric and electronics to enter into India, a huge
market with a population of 1.3 billion.
The Korea International Trade
Association (Chairman, Kim Young-joo) issued a report titled ‘Strategies and
Implications for Small and Medium-Sized Enterprises to Expand into the Indian
Market’ and assessed that India’s competitiveness for manufacturing value
chain, including food manufacturing and processing, automobiles and electric
and electronics is relatively weak.
According to the report,
India's food manufacturing, processing and packaging industries are
experiencing rapid growth. However, due to the poor manufacturing technology
and logistics infrastructure of local companies, the exports of Korea’s packaging
materials, processing machinery and cold chain technology as well as business
expansion through mergers and acquisitions with local distribution companies
will be promising. In addition, India's automobile and electrical and
electronic industries depend heavily on overseas companies in research and
development (R & D) and after-sales service (A / S). Therefore, there is high
possibility for Korean companies to advance into the local market with Korea’s
high technology and customer management know-how.
On the other hand, when it
comes to information communication technology (ICT), e-commerce, and smart
city, which are future industries, Korean companies’ competitiveness in India
is relatively weak. In case of ICT and e-commerce industries, awareness of
Korean companies in India is insignificant as Korean companies are behind in
the competitions for technology and investment due to the capital power gap
between Korean companies and global corporations of the United States and China.
India is planning on large infrastructure projects in order to build 100 smart
cities by 2020, but Korea does not have enough participation strategies or
support from the government level.
In regard to this, a game
company Zeppeto, which provides online FPS (First-person shooter) game called 'Point
Blank' in more than 60 countries, has recently met with the Korea International
Trade Association and expressed its
difficulties to compete with the companies of the United States and China with
a huge capital power. Cho Young-il at Zeppeto pointed out, "In order to
Korean companies to successfully make inroads into the IT and telecommunications
markets in India, the Korean government needs to build a new technology
development support system at the national level."
Ssangyong E & C, which is
involved in building smart cities in India, has world-class construction
technology. However, the company is closely watching the market situation as
India does not have proper infrastructure environment. Lee Kyung-kwon, head of
India branch, stressed, "India's smart city market is still in its infancy.
In order to win project orders, large-scale support at the national level is required."
Therefore, as the keys to
success for Korean companies in the Indian market with a population of 1.3
billion, the report suggested ▲ fast-track system that
eliminates various procedures to select promising IT technologies and foster
companies, ▲ tax support for e-commerce companies, ▲
activate country-led project consortiums through official
development assistance (ODA), and ▲ sustainable
Ahn Geun-bae, head of KITA's
Trade Policy Support Division, said, “In order for Korea to dominate the Indian
market in competition with global companies from Japan, the United States, and
China, it is urgent to provide diverse policy supports, including government’s
support for next-generation technology development, tax benefits, and stronger financial