India wants to compete with China in Russia

Over the past twenty years, India has come a long way to become a technology hub for many industries, offering the best engineering talent and digital technologies at a competitive price. Lets look at what is being made in India today and how they have managed to localise and promote their brands so well.
Made in India
The Indian economy is one of the most dynamic in the world, having begun its rapid growth in the late 1990s. And despite being hit by the 2008 crisis and then the pandemic, the country has managed to become one of the world's manufacturing hubs. And in the most promising areas: electronics, semiconductors, drones.
With the advent of Prime Minister Narendra Modi's flagship "Make in India" programme, protective tariffs on imported goods, increased subsidies for locally produced goods and powerful government support programmes have been launched. The ruling Bharatiya Janata Party has pledged to make India the world's third-largest economy by 2030. And it seems to be up to the task.
"Such an economic policy, combined with the main competitive advantage - human capital (and India's population is 1.4 billion, with about 60 per cent in the 15-64 age group) - allows us not only to follow global trends, but also to influence their creation," says Alikhan Khashiyev, vice president of Synergy Corporation.

It may not be obvious to everyone in Russia, but India is no longer just a back office for international companies. Global aerospace companies rely on Indian engineers. India's IT sector has become the talk of the town: it now accounts for around 10% of the country's GDP. Indian companies that outsource services have no competition in the global market.
Over the past two decades, India has attracted almost a trillion dollars in foreign direct investment (FDI), says Anastasia Prikladova, associate professor at the Department of International Business at the Plekhanov Russian University of Economics. For example, investment inflows into the automotive industry will increase from $1.6 billion to $7 billion by 2022.
Thanks to the broad diversification of national companies, this success is being projected into other sectors of the economy. The Tata Group, for example, is not only involved in the production of cars, but also in metallurgy, energy, chemicals, food, IT and telecommunications. But it is worth looking at the automobile industry separately.
Last year, India overtook Japan for the first time to become the world's third-largest car market after China and the United States. In 2022, 4.25 million vehicles, including passenger cars and commercial vehicles, were sold in India. This growth has been achieved mainly by meeting unmet demand.
India now offers full cycle services in vehicle design, electric motor development, in-car infotainment systems and autonomous driving algorithms. The leading national automotive companies are Tata Motors, Mahindra & Mahindra and Bajaj Auto.
According to Elena Afanasyeva, Associate Professor at the Department of Industrial Thermal Power Engineering at Moscow Polytechnic University and an engineer, Tata Motors is a prime example of how a local car manufacturer from a third world country has become a major international company, influencing global market leaders.
Mahindra & Mahindra is another well-known car brand with a strong presence in both domestic and international markets. The company produces a wide range of models (from compact cars to powerful SUVs). In the 1960s, they worked with French steelmakers, then with the Americans - to produce tractor equipment. And in the 1990s, they signed a new agreement with Ford to add passenger cars to their range.
Bajaj Auto is a leading manufacturer of two and three-wheel vehicles: motorcycles and scooters. Founded in 1945, the company began as an importer of Italian scooters, but within a few decades had entered the global scooter market. Four million motorcycles and hundreds of thousands of three-wheeled scooters are produced annually at several Bajaj factories in India (another is in Indonesia).
Until recently, only one in ten Indians owned a mobile phone. By 2023, that figure will rise to 71%. Total 'smartphoneization' has become one of the manifestations of the digital revolution - another major initiative of Prime Minister Narendra Modi.
Now, India is increasing its electronics exports to the US and UK, indicating growing competition with China. For example, if in November 2021 all electronics exports from India to the US were 2.51% of those from China, by 2023 the share will have risen to 7.65%. For the UK, the figure rises from 4.79 to 10%. Exports to Australia, Canada and New Zealand will also increase.
Bloomberg notes that the Indian government is creating attractive conditions for electronics manufacturers - reducing taxes, simplifying the process of acquiring land. The country is home to Samsung's largest mobile phone plant. And by the end of this year, India will have the first domestically produced semiconductor chip in the country's history.
The Indian company Micromax, for example, is one of the world's largest manufacturers of mobile devices. According to Afanasyeva, the main advantage of the company's products is that they are inexpensive and have relatively high technical features. Micromax focuses primarily on young people and people with low incomes. Incidentally, the company came to Russia in 2014 and introduced a wide range of low-cost phones to our market.
Tata Consultancy Services (TCS), Wipro and Infosys Technologies also have strong positions in the IT and electronics manufacturing sectors. According to Prikladova, this industry concentration can be explained by the key competence of the Indian economy - highly qualified IT specialists with relatively low salaries.
The Indian market is highly fragmented. 69 per cent is made up of unorganised small and medium-sized enterprises, but there are also major players such as consumer electronics company Bajaj Electricals Ltd. and the Godrej Group, IFB Home Appliances and Electronics Mart India.
As Prikladova notes, the success of Indian companies is based primarily on the high capacity of the market. But the main condition for demand for products is affordability. Indian companies are able to meet this requirement thanks to low production costs (cheap labour and economies of scale) and distribution efficiency (due to high population density).
Indians in Russia
In Russia, increased demand for solvents is leading to greater competition in the market. "As a result, increasing production volumes is currently a virtually impossible task. At the same time, the entry of Indian companies is complicated by the fact that Russian consumers are not familiar with their brands," says Prikladova.
Even Chinese goods are somewhat sceptical about their quality, despite the scale of their presence in Russia. The expert recalled the situation with Iranian car deliveries in 2022. Despite the shortage and relatively low prices, they never became popular.
According to Khashiyev, Russian consumers should be prepared for goods from India, product marketing should be tailored to our target group, and a large-scale advertising campaign should be conducted.
And if companies can offer products at low prices with an acceptable level of quality, they will be able to occupy their niche. But for the time being, Indian-branded equipment is something unknown and not very clear to the Russian consumer, experts say.