Interview to Kiran Jagtap, Civil Engineer at INDOLINK Consulting

kiran

Kiran Jagtap

“India is a country with diverse cultures, with a lot of contradictions. Instead of comparing it with things at home, foreign companies planning to set up in India should try to accept and adapt to Indian conditions, ways..”

This month we are interviewing Kiran Jagtap who takes care of the industrial set up projects in INDOLINK Consulting. Kiran was born in Karwadi, a small town in Ahmadnagar district in Maharashtra, India. He is a Civil Enginnering Graduate from Pune University with a Post Graduate in Project Management and has been working in industrial and institutional construction projects for the last 10 years.

He’s 35 years old, is married and has a son and has been working with INDOLINK since 2008.

IL: What activities do you carry out in INDOLINK?

KJ: I work as Project Manager for industrial set up projects. I take care of most of the plant construction related activities like: Planning, layout design & finalization, estimation, budgeting, tendering, contracting, liaisoning for construction related permissions/ approvals,  scheduling, quality control, supervision and review, budget control, certification of bills, erection,  project closure and  project handover to client.

IL: What do you like the most of your job?

KJ: Well, what I like most of my job is when we complete the project successfully and then hand it over to the client. It’s very satisfying.

IL: And the least?

KJ: Sometimes you come across situations when you are responsible for the results but you don’t have the required authority to handle it appropriately. This is very stressful, sometime situation may become really tense.

IL: In which projects have you worked so far?

windar-gamesa-hine-bellota in indiaKJ: till date I have handled industrial, residential, institutional as well as infrastructure development projects.  Like medical and engineering universities, infrastructure for food industry like a wine park, a cold storage facility, etc. During my tenure in INDOLINK,  I have handled the construction management of the industrial sites of BELLOTA in Nasik, GAMESA-MADE and HINE in Chennai and WINDAR in Vadodara.

IL: You’ve already worked few years along with our foreign customers, especially Spanish, do you see a lot of difference on the way we are/we work (Indian vs Spanish/Western)? 

KJ: Yes, I see lot of differences, mostly cultural. India is a country with different local cultures, habits, languages, traditions, politics and also the government policies and laws. Many of the things are unpredictable here.  Western people expect everything to be scheduled, which sometimes is impossible to do. This is annoying for them. For example, the time required to obtain license/permissions from government authorities is difficult to predict, whereas customers want to know the date.

IL: What are the main difficulties from your point of view when a foreign company wants to set up a production plant in India?

KJ: The major difficulties I have observed from the foreigners at personal levels are problems with the interaction with the local people, different perception of what’s happening and adjustment to the local social life style.

For the companies the most difficult aspects are to find the right place for the plant, to find the right people (employees) at the place chosen, to understand the local government policies, laws, rules and taxation (there are different authorities for different permissions, approval and taxes) and get the things moving.

IL: What advice would you give to the foreign companies that are thinking of setting up a plant in India?

KJ: India has very good opportunities for the investment and business set ups. It is not an easy task but also not such a difficult or impossible one. The most important thing is to be careful while selecting the local partner, consultant and/or people on key positions. Those right choices  at the beginning will help them to set up the operations smoothly in spite of the challenges and difficulties.

IL: Any interesting experience during execution of the projects that  you would like to share with us?

KJ: Each project executed is unique and full of challenges.  However,  the most interesting for me was Gamesa set-up.  After identifying the factory we just had 4 months to start the production, which initially we said it was impossible. But, when it was clear that deadline couldn’t be postponed, we tried hard and did it on schedule.

IL: What would you suggest to your suggestion to Spanish companies planning to construct its factory in India?

KJ: India is acountry with diverse cultures, with a lot of contradictions. Instead of comparing it with things at home, foreign companies planning to set up in India should try to accept and adapt to Indian conditions, ways…This will make their life much more comfortable.

IL: Any interesting book or movie you advice us to read/watch? 

KJ: I liked the book “you can win” by Shiv Khera and the movie “Chak de! India”.

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Key success factors to setup business in India

This article was published in the ICE (in english Spanish Commercial Information) Economic Bulletin in February 2011.

Author: Mario Gil, Director of INDOLINK Consulting

The present article aims at encouraging executives from small and middle scale European companies to set up business in India. With this objective we present the main variables which make India an attractive business destination, the major obstacles limiting the access to available opportunities and, finally, a few suggestions to avoid those constraints and increase their chances of success in setting operations in this country.

Any internationalization process, regardless of its magnitude or destination, constitutes a major decision in the life of a company, with far reaching implications. Given the difficulties which that decision implies, in the introduction of this paper we present an approach which may break the generic conflict many industrial SMEs face in venturing on their first foreign establishment.

In these links you can find the full article:

CASE STUDY OF A SPANISH SME FROM ELECTRONIC SECTOR IN INDIA

ADD Semiconductor (Advanced Digital Design S.A.)  is a Spanish company set up in 2001 by two professionals from the Zaragoza University with more than 15 years of experience in microelectronic design. ADD develops systems of high efficiency and low cost in one chip (System on Chip) for telecom application and signaling processors. ADD is growing fast and nowadays has 40 employees between Spain, India, China and USA.

In 2009 ADD identified India as a priority market. Along with China and USA, India is one of the biggest markets in this sector. The country has more than 135 millions power meters where the ADD chips are inserted. Compared to the European average of one meter per inhabitant, and making a conservative estimation, in 10 or 12 years India can reach 700 millions of meters.

In addition, India is experiencing a robust development in infrastructures, which is pushing the electronic sector. ADD’s product has several applications such as controlling public lighting,  controlling solar energy panels, home automation, etc.

According to its International Sales Vice-president, Jesús Teijeiro, “we were aware that, for entering the Indian market, our physical presence was required. Speaking the same language and sharing the same culture is basic to do business”.

The basic structure needed by ADD to set up in a country is composed of two people: one Business Development Manager, who must have a good knowledge of the region and the potential customers, and one Application Engineer for giving technical support to their clients.

Instead of choosing the traditional strategy of creating a commercial subsidiary, ADD opted for recruiting these people on a contractual basis through a third party (INDOLINK). Ensuring their full dedication to ADD would guaranty their objective of establishing quickly in the market without the need to create their own legal structure, avoiding several duties and diverse legal, accounting and financial costs.

“At the time of deciding which company was going to support us in our entry strategy we assessed a couple of options. We chose INDOLINK due to its experience with other clients in the industrial sector. We wanted a sound consulting firm that knows how to move fast in the market. The promptness in hiring our technical staff and their Business Centre guaranteed a fast set up at a reasonable cost”.

In September 2009 the recruitment was finalized and the two newly hired professionals joined duty. The experience is being more positive than expected, in less than a year they have got important contacts and brought in the first big sale, “normally it takes between one year and a half to two years to recover the initial investment. In India we hope to recover the investment in our first year working there. We expect our turnover to be around one million Euros in the next financial year. We plan an exponential increase; by 2012 we hope our turnover to reach 5 to 6 million Euros.”

According to ADD, the main causes for their success are, firstly, having a sound and robust technological product very suitable for markets like the Indian. Secondly, recruiting the right people with a deep knowledge of the market, who have effectively conveyed their product value to the client. Finally, the support and orientation provided by INDOLINK to ADD and their local staff.

When compared to other countries, their experience in India shows particularly positive. ”We have been working in China one year prior to India, but it is only now when we are starting to receive the first orders, and they are still much smaller than the Indian orders. We have noticed that the Indian market is more open, more prepared to listen, and there are less idiomatic barriers than in China. ROI is higher in India than in China. We would recommend consolidating first in the Indian market and then trying the Chinese one. In EEUU we are also having good results because it’s a market that is not so price sensitive”.

Currently ADD is recruiting a new engineer and they are planning to continue expanding their staff. In the medium term they will establish a subsidiary company, once their sales confirm their real possibilities in the Indian market.

Recruitment on contractual basis through a third party is a convenient alternative for SME’s that are willing to enter in international markets, but prefers to avoid incorporating a subsidiary company ad hoc.

Advantages of this type of strategy:

SOURCE: INDOLINK

HINE will establish in India with the help of INDOLINK

The Spanish group HINE, founded in 1974 and consisting of seven companies with international presence, has decided to set up in India.

HINE Group, an international leader in designing, manufacturing and integrating hydraulic systems and components, has made the decision based on the size and expectations of rapid growth in wind power sector and other industry sectors in India.

India currently produces wind turbines with a capacity of 4,000 MW per year and all predictions indicate that both the number and power of generators will increase in coming years.

HINE Hydraulics India Pvt. Ltd. will initially supply to the plant Gamesa-Made has recently installed in India. HINE relies on its technological leadership and higher quality standards to rapidly expand its customer base.

INDOLINK is supporting HINE in its venture in India. Currently we are working on the formation of its subsidiary in India which will be located in Chennai.

The HINE Group, whose founder was recently honored for his long and successful business career, has other overseas establishments in China, USA, UK and Brazil.

Source: INDOLINK Consulting

INDOLINK has been chosen by WINDAR (Daniel Alonso Group) to assist them in setting up their subsidiary in India

The company WINDAR located in Avilés (Spain), owned by Daniel Alonso Group (70%) and Gamesa (30%); will set up by 2011 a wind turbine tower factory in northwest India. The factory will be similar to the one which Windar has in Avilés, which eight years ago required an investment of 12 million euros, will occupy an area of 20,000 square meters plus a large field of open space for the storage of materials and finished products.

The Spanish industrial group, Daniel Alonso, with a turnover of  450 million € and more than 2,000 employees, has a proven industrial experience in providing global solutions to the manufacturing sectors of cement, energy, environmental, metalworking, shipbuilding, petrochemical and steel industries that they have been developing since 1958.

The industrial growth experienced by India in recent years and its expected current and future development, make of this country a base of strategic importance. The set up of WINDAR in India is for Daniel Alonso Group, a firm step in their approach to this country.

This is the first plant that WINDAR establishes outside the Spanish territory. Orlando Alonso, CEO of the group explained that the aim is that the Avilés plant will satisfy the entire European market and North Africa. The other two Spanish plants will supply the domestic market. The Indian subsidiary will only cater to the Indian market: “It’s a new market that we will add, never subtract from which we already have,” he said.

India is the sixth largest consumer of energy, with an installed capacity of around 160,000 MW, of which 15,000 are for renewable energy. Nevertheless, the country still has an energy deficit of between 8 and 12%, which together with its industrial development and rising household consumption requires huge investments in power generation in all its possible sources.

The Government of India plans to add 100,000 MW in the coming years, of which 10% will account for renewable energies, where the wind represents 70%.

Given the importance of the project, the magnitude of the investments to be made and the complexity of this kind of process, WINDAR needed advice from a reliable company with proven experience in production plants in India. That is why Windar has selected INDOLINK, to support them in various stages of its set up in this country. INDOLINK has worked in recent years in the successful establishment of GAMESA in India and currently works on setting up some of its major suppliers.

Fuente: INDOLINK Consulting

Gamesa inaugurates their Wind Turbine Factory in India

On 9th February, a delegation of Gamesa led by the President and Chief Executive of Gamesa, Jorge Calvet and Ramesh Kymal, Managing Director of Gamesa India, officially inaugurated their first factory in India.

The factory is located in Red Hills, a few kilometers from Chennai. Mr. Kymal pointed out that Gamesa will produce all the components of the wind turbines in India, except for the blades.

Gamesa factory in Chennai

 Gamesa presently employs about 100 people and estimates to increase the staff to 200 by the end of this year.

Additionally Gamesa will invest in the creation of Wind parks in India. The Spanish company has started to acquire land in Coimbatore and Theni for the development of the parks. They expect to create a capacity of 50MW and 85 MW respectively.

INDOLINK has assisted Gamesa in their setup process in India. The services rendered include strategic consultancy, location study, recruitment of key personnel and refurbishment of the factory. INDOLINK was present in the event through their delegate in Chennai.

Gamesa factory in Chennai

NETEX opens branch in Pune, India

Company / Institution: NETEX

Year and place: 2008, Pune

Sector: Information Technology

Services provided: Company formation

NETEX was established in 1997 to develop applications and E-learning services for corporations, universities among others. It is a young and dynamic company that after carrying out strategic thinking in 2006 decided to internationalize and become a global company.

Out of its reflection India came as one of the key countries where to be implemented. The advantages offered by India are the availability of qualified personnel at competitive cost, market diversification and a change of mentality towards a multilingual company that develops its work in different languages.

Indolink has made the establishment of NETEX subsidiary in India.

Netex