France to remain bullish on ‘Make in India’

The Dollar Business Bureau A White Paper on French Companies Making in India, prepared by the French Embassy says that 10 to 30 new French establishments are being set up every year in India since 2003. These new companies are normally specialists in one line of business; sometimes they are very specific and thus help in the growth of the Indian market. They generally have to face difficulties during the initial phase of their business setup. The share of SMEs (Small and Micro Enterprises) in these new establishments is more and more significant as they covered 50% of the new establishments in 2013.  There is an ever increasing growing presence of French independent entrepreneurs in India. The group’s size stood at 180 according to the study. They are mostly engaged in counselling/advisory field as well as in hotels and restaurants. A White Paper on French Companies Making in India, prepared by the French Embassy was released by Amitabh Kant, Secretary, Department of Industrial Policy and Promotion, Ministry of Commerce & Industry, Government of India on March 23, 2015. The White Paper was launched at an interactive session, jointly organized by FICCI (Federation of Indian Chambers of Commerce & Industry) and the French Embassy in the presence of CEOs of leading French companies in India. The paper giving the reasons of growth of French investments in India says that there are several factors behind the growth of French establishments in India - the relatively closed nature of the Indian market and high custom duties, which in turn demands localization of production center; the size, the growth and the advantages of the Indian market (notably the not so expensive labor); and at last the specialization of a certain number of big French Enterprises in sectors where it is more suitable to manufacture the product locally rather than importing the finished product from somewhere else.  India however continues to remain a risky market for French SMEs and ETIs (small sole proprietorship companies), considering the local business environment. For ease of doing business in India, Kant said that there was a need to converge and integrate technology across government departments and the first step towards this end was the eBiz platform, which aims to create a business and investor friendly ecosystem in India by making all business and investment related clearances and compliances available on a 24x7 single portal with an integrated payment gateway. Kant informed that India was opening up its FDI (Foreign Direct Investment) regime. Sectors such as railways, defence, construction, insurance and medical devices have already been opened up for FDI and urged the businesspersons to suggest ways to further enhance FDI.  Presenting the synopsis of the White Paper, Francois Richier, Ambassador of France in India, said that French establishments continue to grow in India. Linked to 394 major French conglomerates, there are now 1051 establishments or French entities in India, which are subsidiaries of either the companies or the Groups based in France. These numbers are undergoing a constant increase as the research data is from the year 2013, which actually reflects the data of 2012, and a list of 750 establishments linked to 350 parent companies.  

This article was published on March 24, 2015.