Latin America: India’s next frontier

by Dave

Latin America (orthographic projection)
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I think the India-Latin America trade corridor is one of the last frontiers in business. India does more trade with Africa – 2-way flows about $40 billlion, which has  a fraction of the overall GDP($2,5Tn at PPP) compared to Latin America (almost $6Tn at PPP)  – 2-way flows about $16billion. So, the future potential is quite rosy.

via Latin Business Chronicle:

“We are very upbeat about Latin America and view it as the next frontier of growth,” says Harshul Asnani, head of Latin America and US West operations for BPO company TechMahindra.

The rapid growth in IT and network spending, increased mobile/broadband penetration and large scale consolidation in the telecoms sector in Latin America offers “vast potential” for a specialized telecom-focused systems integrator like Tech Mahindra, he says.

Omar Momin, vice president of strategy and M&A at Godrej Industries, also sees strong Latin America potential. “There are tremendous opportunities in Latin America that fit in with our strategic objectives,” he says. “These emerging markets have characteristics and consumer demographics similar to India with significant middle of the pyramid populations. They also hold tremendous potential in terms of growth in the coming decade and give the Godrej Group an opportunity to serve the needs of Latin American consumers better.”

One of the reasons why India´s trade with Latin America is below potential is the inadequate attention Indian business have paid to this region in the past,” says R. Viswanathan, India’s ambassador to Argentina, Uruguay and Paraguay and his country’s top Latin America expert. “Now this is changing. [Indians] are impressed by the strength and resilience of Latin American markets which have withstood the U.S. crisis and are marching ahead despite the gloom in Europe.”

In terms of sectors, he predicts that Indian investment will grow in IT, agribusiness, mining and petroleum in the coming years.

Meanwhile, lighting products manufacturer Havells Sylvania is also looking at expanding. “We are open to new proposals and are looking at both organic and inorganic growth in Latin America [along the] lines …Havells in India has aggressively grown from year to year,” says Kapil Gulati, the Costa Rica-based general manager and director of the Americas for Havells Sylvania. “We plan to initiate assembly operations in a few countries.”