International Resources: Global Market Profile: India

Courtesy: Produce Marketing Association

As part of its commitment to providing its members with market analysis and insight, PMA has compiled the following information about India from Attaché Reports submitted by the U.S. Department of Agriculture’s Foreign Agricultural Service, as well as the CIA World Factbook, embassy sites, and business etiquette reference guides.

Entering the Indian Market

Indians prefer to do business with those they know. Relationships are built upon mutual trust and respect. In general, Indians prefer to have long-standing personal relationships prior to doing business. It may be a good idea to go through a third party introduction; this gives you immediate credibility.

Normal office hours are 10:00 a.m. to 5:00 p.m.; however, in some large cities [e.g., Mumbai], some places of business start working earlier to avoid congested traffic while commuting. Increasingly, among the business organizations, there is also a trend towards a longer working day, which can start as early as 7:30 a.m. and last till 8:00 p.m. Normally, lunch is for one hour, between 12:00 p.m. and 2:00 p.m

Most Indians take vacations during the summers [April-June] and mid-December to mid-January. In addition, in Northern and Eastern India, a favorite time for taking vacations is around October, which coincides with Dussehra/ Pooja holidays.

India has a long list of holidays. Some of these--e.g., Independence Day [January 26th], Independence Day [August 15th], Gandhi Jayanti [October 2nd], and Christmas [December 25th]--are observed according to the western calendar. The others, which are Hindu, Sikh or Muslim festivals--e.g., Pongal/ Makar Sankranti, Holi, Idu'l Zuha, Dussehra, Deepawali, Muharram, Guru Nanak Birthday, etc.--follow the lunar calendar. The dates for the latter holidays are not the same in terms of the western calendar, and therefore, it is advisable to contact the local Indian Embassy/Consulate to find out the holiday list for that particular year.

Since India is a culturally diverse country, different parts of the country also celebrate festivals which are regional in nature. Thus, each state also has its own list of holidays. You can get this list from the Tourism Departments of the particular states.

It is common to begin meetings with small talk. In India, inquiring about family shows friendliness. Conversations are a way for your India counterparts to get to know and feel comfortable with you. Small talk is also used to help build relationships. Good conversation topics include politics, cricket, films, and Indian Economic Reform. Indian traditions and history are also welcomed topics. Try to avoid discussing Pakistan, poverty in India, and religions. Religious questions will be welcomed only if they are genuine questions about practices, traditions, or holidays.

Women executives, in senior positions, are a relatively new phenomenon in the Indian business environment. If you are a woman, you will normally find people respectful and courteous, but not very comfortable in working with you for business deals. You may have to make extra efforts to get them to discuss business with you.

Gift giving is customary in business culture. When giving a gift, it is not the value of the gift, but the sincerity with which it is given, that is important to the recipient. If invited to your Indian counterpart's home for a meal, it is not necessary to bring a gift, although one will not be turned down and it will be greatly appreciated. Chocolates are always a good gift. Indians do appreciate a gift which is representative of you or your culture. Do not give frangipani or white flowers as they are used at funerals. Roses are the safest flower choice for gifts. Yellow, green and red are lucky colors, so try to use them to wrap gifts, but never wrap gifts in black or white. A gift from a man should be said to come from both he and his wife/mother/sister or some other female relative. Hindus should not be given gifts made of leather; whereas, Muslims should not be given gifts made of pigskin or alcoholic products. Dogs are considered unclean, so toy dogs or anything with a picture of a dog should be avoided when choosing a gift. Gifts are not opened when received. If you are given a gift, wait until the giver leaves to open it.

Agriculture constitutes 19.9% of India’s GDP and 60% of the country’s labor force.

The most typical imported items found in India’s retail stores (in the city) are fresh apples, grapes, pears, and kiwis. The United States, Brazil, Australia, and Europe are some of the countries India imports from.
India is a major mango exporter. In May of 2007, mangoes from India were exported to the U.S. for the first time. Other major fruits produced in India are bananas, citrus fruits, apples, guava, and papaya.

In the vegetable sector, India is known for their onions, which account for 93% of fresh vegetable exports. Potatoes, tomatoes, cauliflower, and cabbage are other major fresh vegetable commodities.

Doing Business in the Indian Market

First impressions are important. Some differences are simply due to the language barrier; others are due to differences in deeply held traditions and practices. If you maintain a polite, patient and professional manner, the likelihood of committing a serious faux pas will be greatly diminished. To help bridge the gaps, we suggest:

Appointments are mandatory and should be made in advance, preferably by a letter. Making appointments should be done anywhere from one to two months in advance. Reconfirm all meetings the week before and then again the morning of the meeting

It is a good idea to emphasize that you will be in India for a short period of time when scheduling meetings.

The best time to schedule meetings is late in the morning or early afternoon.

Always send a detailed agenda in advance. Send back-up materials and charts and other data as well. This allows everyone to review and become comfortable with the material prior to the meeting.

Power Points are a good medium for discussing business.

Follow up a meeting with an overview of what was discussed and the next steps

This is a hierarchical culture, so greet the eldest or most senior person first. Also when leaving a group, each person must be bid farewell individually

Shaking hands is common, especially in the large cities among the more educated who are accustomed to dealing with westerners.

Men may shake hands with other men and women may shake hands with other women; however there are seldom handshakes between men and women because of religious beliefs. If you are uncertain, wait for them to extend their hand.

Titles are very important. Always use professional titles. If you have a university degree or any honor, put it on your business card.

Business cards are exchanged using your right hand after the initial handshake and greeting. Be sure to present the text facing the recipient. Also receive business cards with the right hand

Business attire is conservative. Men should wear dark colored business suits. Women should dress conservatively in suits or dresses

The weather often determines clothing. In the hotter parts of the country, dress is less formal, although dressing as suggested above for the first meeting will indicate respect. Ask your counterpart what is appropriate to wear.

In India, business lunches are preferred to dinners. Also remember, Hindus do not eat beef and Muslims do not eat pork

The word "no" has harsh implications in India. Evasive refusals are more common, and are considered more polite. Never directly refuse an invitation, a vague "I’ll try" is an acceptable refusal.

Since they do not like to give negative answers, Indians may give an affirmative answer but be deliberately vague about any specific details. This will require you to look for non-verbal cues, such as a reluctance to commit to an actual time for a meeting or an enthusiastic response.

Decisions are reached by the person with the most authority, and decision making is a slow process.

Bargaining is common in India. Most Indians expect concessions in both price and terms. It is acceptable to expect concessions in return for those you grant.

Try not to appear overly legalistic during negotiations. In general, Indians do not trust the legal system and someone's word is sufficient to reach an agreement.

Beckoning someone with the palm up and wagging one finger can be construed as in insult, rather use your whole hand with the palm downward and make a scooping motion

Standing with your hands on your hips will be interpreted as an angry, aggressive posture.

Whistling is impolite and winking may be interpreted as either an insult or a sexual proposition.

Never point your feet at a person. Feet are considered unclean. If your shoes or feet touch another person, apologize.

These ideas may help you focus your product approach. India is a country with a long standing tradition of vegetarianism. Religion plays a major role in the diet of many Indians. Due to the fact India is a crossroad to the East, many foreign influences have seeped into the culinary culture.

Desire for freshness is always very high while shopping for food. Many people in India go food shopping daily. Traditional spices and ingredients are also important in cooking and taste preferences. Trying new foods is common in India; however, if tailored to traditional Indian tastes, acceptance of food will be higher. Casual dining is where most Western style foods can be found

Fruits and vegetables are viewed as seasonal commodities in India. Availability is not always guaranteed. It is common that consumers adjust their diets to the seasons.

Indians are cost oriented due to the lack of great amounts of disposable income. The reluctance to pay premium for commodities might jeopardize a sale. Also there is a large agro-industry that can supply commodities at competitive prices. The demand for high-value food items coincides with the Festival of Lights (from October to December). Many foods are imported, especially nuts, candy and fruits. It is advisable to introduce new items to the market during this time span.

Exporters to India must be aware that the refrigeration system, both in homes and in transportation vehicles, is lacking. Many homes in India do not have a refrigerator. Also while shopping, many consumers visit multiple stores. One store might be for fruits and vegetables, one for dairy and yet another for meat. Quality is very important, so when shopping, many Indians go to places that are reliable or trustworthy.

Before coming to India, use the many sources of information, for example, the Foreign Agricultural Service, state agricultural offices, and state/regional trade organizations.

Be patient regarding requests for documentation, ingredients lists, production process, and quality assurance.

Respond to such requests with diligence and in a timely fashion.

This is a basic statute established to protect consumers against adulterated foods, and it encompasses food colors and preservatives, pesticide residues, packaging, labeling, and regulation of sales. This is similar to the Federal Food, Drug, and Cosmetics Act of the United States’ Food and Drug Administration. PFA standards and regulations apply equally to domestic and imported products. The PFA Act and Rules, and recent notifications are available at: http://mohfw.nic.in/pfa.htm

This established standards for weights and measures to regulate interstate trade and commerce in goods that are sold or distributed by weight, measure, or number. The Rules formed under the Act require labeling regarding the nature of the commodity, the name and address of the manufacturer, quantity, date of manufacture, best-before date, and the MRP. These labeling requirements apply equally to imported and domestically packaged foods.

These legislative measures regulate imports of planting seeds and agricultural products into India. These can be accessed from: www.plantquarantineindia.org/PQO_amendments.htm