Huge opportunity for business in India’s fintech space, UKIBC says

The UK India Business Council sees opportunities for trade, investment and collaboration with India across financial technology (fintech), food and drink, electric vehicles (EV) and other sectors.

A report published by the industry lobby group, in collaboration with the UK’s International Trade Department, titled Opportunities for UK Regions in India: An Analysis of Key Sectors for Collaboration, said both nations share major synergies – both in shared areas of strength such as the digital sector, and in areas with complementarity.

“For example, the UK is a world leader in advanced manufacturing and engineering technology, while India is home to an abundant, highly skilled workforce and is driving its own manufacturing agenda under the Make in India initiative,” the report said.

The partnership between both countries will grow as negotiations for a free trade agreement get underway. Negotiations for a trade agreement between both nations began in January this year and the agreement is expected to be signed by Diwali.

“India is home to various clusters where certain sectors are stronger than in other areas. Particularly in the case of India, such is the size and diversity of the country between states, it is important that UK businesses are aware of the clusters that suit their sector and objectives. This report seeks to identify the regional strengths of both countries and highlight synergies to enable businesses in certain sectors and regions to succeed in the UK-India Economic Corridor, it said.

The industry lobby group sees opportunities for businesses in India’s fintech sector, where mobile internet usage is increasing rapidly. As the younger demographic is used to using mobile devices and is eager to try new products and services, the rapid adoption of new payment solutions entering the fintech industry can be quite pleasant, it said.

However, the report warned that rapidly changing regulations due to the evolving nature of the sector pose cost-related challenges for businesses. Moreover, the fintech sector is still governed by banking regulations, and India has yet to come up with its own guidelines for the industry.

India’s food processing industry could also be another area of ​​interest, as the country currently processes 10 percent of its agricultural output, providing a huge opportunity to improve processing and attract investment.

Sometimes products or ingredients that are generally accepted globally are not allowed in India, and items such as alcoholic beverages incur high import duties of up to 150 percent.

The report further said that while the EV transition in India will take time, it will open up a range of opportunities for companies in the battery supply chain, automotive industry, services, charging infrastructure and power grid.

“The efficient, affordable and skilled workforce in the Indian automotive industry can benefit investors. Furthermore, India’s electric mobility ancillary sector is expanding rapidly, bringing significant benefits to companies, which consider India as a manufacturing hub for worldwide operations. It is undoubtedly beneficial for any foreign player to participate to maximize the market’s potential, it said.

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