French companies in India

Abstract

India is a very diverse and segregated society with an one-off cast system, and Indians have several religions and speak many different languages. Despite all these elements, they were able to build a sustainable form of democracy, which knows how to integrate every category of its population. India is the « biggest democracy in the world » not only for its size, but also for the stability of its institutions and the great intensity of its democratic life. Investing in India is becoming increasingly important for French companies as India is indisputably developing into a key new international player. Facts and figures demonstrate this global interest of India as an investment destination, although some French companies remain timid when it comes to the country’s potential and their local investments. A significant number of French companies have been successful in their start-up attempts, and usually take the lead over the local market after a couple of years, but the time taken to get a return on investment, partly due to the protectionist business environment and local administrative complexities. Therefore, this Franco-Indian relationship although solid and promising, yet doesn’t have the level expected, and we must wonder on their ability to take advantage of the rising Indian Economy. In this report we will demonstrate that even if there are many challenges for French companies to do business in India, there is still a huge potential for market entry and development. The main challenge for foreign firms becomes how to stay in India, successfully, for the long term. In the first part of our report, we make an overview of the Political Relations between India and France, and the history of the French companies in India. In a second part we make a focus on the way for a French company to set up or develop its business in India, showing the potential of the Indian market and the opportunities for the French companies, but also the difficulties they will have to face during this process. Then in a last part we will put a light on some French companies which have already set up their business in India, and show why they succeed or how they fail in implementing their business.