Mr Steven Klein, CEO HSBC Switzerland
Mr Amitabh Malhotra, MD & Head Global banking, HSBC India
Ms Helen Belopolsky, Head Geopolical Risk, HSBC
My colleague DCM Anoop Dhingra,
Mr Sanjiv Nayar, President ASSOCHAM,
Captains of Swiss & Indian Industry,
President CA Chapter of ICAI, Mr Shivang,
Ladies and Gentlemen,
Good evening,
Thank you to HSBC Switzerland and India, for organizing today’s event. My special thanks to Raghav Handa for his steadfast approach in ensuring that we meet before WEF Davos 2025 for the second dialogue with Swiss Investors in Zurich.
2. Post our first meet last year, two important developments took place. The first one is the signing of the India-EFTA Trade and Economic Partnership Agreement (TEPA) in March this year.
3. You would recall my expressing strong optimism in early conclusion of this FTA at last year’s event. I am glad that we could bridge the gap between our two sides by looking at future prospects and not by continuously getting mired into contentious issues of the past 16 years.
4. There were strong reasons for my optimism. A strong commitment to our common values and shared prosperity, a deep understanding of complementarities that exist between our two economic structures, and global headwinds that have adversely affected supply chains.
5. I am confident that there is a consensus in political and business leaderships on the Swiss side about the future prospects emerging out of this FTA. We hope for early operationalization of the agreement which is, no doubt, a historic milestone in our bilateral trade and investment relationship.
6. This forward-looking Agreement has given us a definite road map and framework for our businesses and industries to forge mutually beneficial partnerships, opening up exciting new avenues for collaboration and growth.
7. India sees the potential benefits of cutting-edge technology and investment from EFTA countries, which are crucial for realizing our vision of becoming a global manufacturing hub with job opportunities for our youth. With its dynamic economy, a business friendly environment and vast market potential, India has emerged as a fertile ground for investors looking for new avenues.
8. Friends, the second important development is the conduct of general elections in India during April-June this year. This was the greatest celebration of democracy on the planet. Indian electorate expressed through a peaceful exercise its faith in the forward looking policies of the government led by PM Modi. By re-electeing the previous administration, it chose political continuity in India.
9. India is firmly treading a path of unprecedented growth and development. This, we believe, will not only bring prosperity to Indian masses, but will also be an engine of global growth. India’s progress is World’s progress.
10. As the world's fastest-growing major economy, India offers a stable political climate, a large and youthful workforce (65% below 35 years), and an abiding commitment to economic reforms. I will briefly discuss some of the ground-breaking reforms undertaken by India to strengthen this ecosystem and the opportunities it presents for global investors and collaborators.
11. As you know, India is at present the fifth-largest economy, with a current GDP of nearly USD 4 trillion and it is set to be the third-largest economy by 2028. It achieved a growth rate of 8.2%, surpassing its own estimate of 7.3% last year.
12. In my opinion, there are two parallel developments in the past decade, that have catapulted, so to say, India into this unenviable growth trajectory. First is development of demand-driven physical and digital infrastructure and second structural and legal reforms undertaken for ease of doing business in India- for both India and foreign industry.
13. I acknowledge our traditional weakness in physical infrastructure in the past. This was a major cause of high logistics costs for the businesses and in fructuous expenditure for the economy. But this is changing rapidly. To cite a few examples of the scale and pace of the development, which any visitor to India can vouch for-
-Developing both domestic and international airports of highest standards-
-Laying of rail lines and new high speed rails
-Ports- International and Inland
14. Under the PM Gati Shakti Plan, 16 Ministries, covering Railways, Roadways, airports, ports, waterways and logistics sectors have been brought together on a single platform, for integrated planning and coordinated implementation of infrastructure connectivity projects. It is a GIS technology based platform for real-time online monitoring and tracking of infrastructure and connectivity projects leading to seamless multimodal connectivity and logistics efficiency.
15. The National Logistics Policy aims to reduce logistics costs to GDP from 13-14% of GDP to a single-digit percentage so as to bring India among top 25 countries in Logistics Performance Index (LPI) by 2030. Presently we are at 38 position.
16. The National Industrial Corridor Programme aims to develop futuristic industrial cities to compete with manufacturing and investment benchmarks. Along the As many as 100 Industrial smart cities have been planned and designed to international standards with plug n play infrastructure, single window clearance processes, multimodal connectivity, transparent e/Land management system and complete handholding support from the government.
17. Semicon India Mission, another strategic initiative launched in 2021, focuses on boosting the domestic semiconductor industry, reducing dependence on imports and strengthening India's position in the global supply chain. It has earmarked Financial incentives worth USD 10 billion to incentivize the semiconductor and display manufacturing ecosystem.
18. On digital infrastructure front, noting short of a revolution has taken place in India. Jan Dhan, Aadhar, Mobile, the JAM trinity, as we call it, has really allowed services to be delivered most efficiently and with least cost. Opening of over 500 million bank accounts has brought masses into formal economy. Aadhar, Unique digital identity for 1.4 billion people is the largest such digital database which has been created to seamlessly provide and access services. And thirdly, 1.2 billion mobile phones out of which 750 million are smart phones, Deep internet penetration with 850 million users.
19. We are witnessing a digital and fintech revolution driven by JAM. The surge in Innovation has democratized financial services, making them more accessible and efficient across the nation. It has changed the way we manage, invest and transact our money.
20. With the Unified Payment Interface (UPI) and mobile wallets, the ease and speed of digital transactions have become integral to the lives of millions, even in the country's remotest corners. In October last month, we made 16.5 billion UPI transactions valued at 278 Billion USD. This revolution of sorts has been possible due to the drastic reduction in data costs, which are amongst the lowest globally. And we are targeting a USD 1 trillion digital economy by FY 2026.
21. Similarly, the healthcare and life-sciences sector, which is of particular interest to Swiss investors, is one of the largest employers in India, worth nearly USD 372 billion. The introduction of tele-medicine and e-health facilities is further expected to create about 3 million more jobs in coming years. This sector offers immense potential for beneficial partnerships through a combination of Swiss leadership in R&D and Innovation and India's expertise in developing scalable and cost-effective solutions.
22. The other strand is reforms undertaken for ease of doing business. Last year, queries were made about simplification of taxation for businesses. To this end, the Government introduced the Goods and Services Tax (GST) in 2017, one of the most significant indirect tax reforms implemented in the history of Independent India. GST replaced all indirect taxes levied on goods and services by the Central and State Governments and unified the compliance framework by drastically reducing compliance costs and helping companies invest those funds in business development.
23. Other major reform is introduction of the new "Insolvency and Bankruptcy Code" (IBC) in 2016 has not only transformed our country's approach to insolvency but also empowered India to emerge as a key player in the global economic arena, paving the way for a more robust and promising economic future.
24. Historically, India faced substantial challenges in dealing with insolvency and debt recovery. Lengthy legal proceedings and inefficient frameworks hindered the resolution of distressed assets, creating uncertainties for businesses, lenders, and investors alike. This climate, understandably, posed difficulties for foreign investors who might have otherwise seen India as an attractive, high-potential market.
25. The new IBC legislation, aimed to create a more predictable, timely, and fair mechanism for resolving insolvency, has established a structured framework for resolving distressed assets, with a strong emphasis on inclusivity and accessibility. This predictability and fairness provide a sense of security and confidence for foreign and domestic investors.
26. The results are evident. In terms of Foreign Direct Investment (FDI), India has emerged as a favourable destination globally. India received around USD 1.1 trillion in FDI in the last 24 years, from April 2000 to June 2024. Switzerland has invested around USD 10.7 billion in India and is our 12th largest FDI partner.
27. To streamline processes and facilitate investments in India, Government has launched the National Single Window System, a one-stop digital platform for all investor approvals – over 660 at the Centre level & 6000 at the State level. Businesses can now identify and apply for approvals and clearances online. They can track their applications, seek clarifications, submit replies to queries to concerned agencies, and download approval certificates through this platform itself.
28. This year, Swiss companies, big groups as well as SMEs, from various sectors have invested in India by starting or expanding their manufacturing facilities, Representative Offices, Subsidiaries, and acquisitions. Among the bigger ones, Zurich Insurance Group entered the Indian general insurance market with Kotak Mahindra Bank by acquiring a 70% stake in Kotak Mahindra General Insurance Company Limited for USD 670 million. This is India's largest FDI in non-life insurers by any foreign company. Zurich Airport is also investing USD 650 Mn to build a greenfield airport in NOIDA near Delhi, slated to open in end of this year.
29. Friends, during my interactions at business events, seminars and other engagements, I find growing interest in India. Many of Swiss companies are already doing business with India successfully and after TEPA, are working on expansion projects and many others are seriously planning to enter India. I invite you all to seize the moment, visit India to understand firsthand the enormity of development exercise being undertaken and the speed at which this is happening. Be a part of this unprecedented growth story, for shared prosperity.
I thank you.
