Businesses in Singapore see India as a bright spot, with Singapore's direct investments in the country crossing Singapore dollars 15.24 billion (US$11 billion), despite a generally weak economic outlook for most of Asia, a media report said today.
Investment by firms in India is on the rise, and companies with a presence in the country say the region's second-largest economy is a challenging market to break into but offers rich rewards.
India's gross domestic product (GDP) exceeded $2 trillion in 2014, according to World Bank data. After taking 60 years to reach the $1 trillion mark, the Indian economy added the next trillion in just seven years, the Straits Times reports.
Singapore's direct investments in India have been rising steadily every year, going up from Singapore dollar 9.56 billion in 2009 to Singapore dollar 15.24 billion in 2013.
Firms in the construction and wholesale and retail trade sectors contributed most to the increase, said national trade promotion agency International Enterprise Singapore.
Manufacturing, financial and insurance services, as well as professional, scientific and technical administrative and support services firms, have also been taking big strides into the Indian market.
Singapore and India have been strengthening their economic links in recent years.
Small and medium-sized enterprises (SMEs) with operations in India are optimistic that its economy is on the brink of lift-off, even as Asia remains mired in a slowdown.
Oil and gas equipment supplier Chase Resource Management sees India as a bright spot amid the downbeat oil market. Its operations have since expanded substantially, and 60 per cent to 70 per cent of the company's business is now generated through India.
"There is still a lot of (oil and gas) work happening on the east coast, and a lot of tenders that we have been bidding for and winning," said director Jayanthi Manian, an Indian origin businesswoman in Singapore. "It is not as bad as other markets in Asia," she added.
"India is an interesting market and shaping up well for us. We are open to teaming up with other Singapore companies keen on the infrastructure sector there," said Manian. However, she noted that Singapore firms tend to hesitate over venturing into India.
"A lot of Singapore companies are scared of moving into India. It is a totally different working culture, and it takes a lot of patience to work there," Manian said.
Vivian Singh, president and chief executive of the personal computer and flash memory manufacturer Strontium Technology, said despite the hurdles, the payoffs can be significant. "In the past, it was important to have a warehouse in every state, but e-commerce is growing fast in India and this helps companies like us," said Singh. India contributes about 30 to 35 per cent of the company's sales which came in at about Singapore dollar 350 million last year."