Swedish firms to raise investment, tap new sectors

December 5th, 2011 - 7:59 pm ICT by IANS  

New Delhi, Dec 5 (IANS) Swedish companies, both old and new in India, are likely to invest around $400 million (SEK 2.7 billion) in the next two years, especially in sectors such as auto, engineering and Information Technology, and tap new areas like healthcare and energy, according to a survey.

“The estimated planned investments for 2011-2013 will nearly be tripled, amounting to approximately SEK 2.7 billion,”
as compared to SEK 1 billion (approx $148 million) during 2009-11, said the fourth Business Climate Survey conducted by the Swedish Chamber of Commerce in India along with the Swedish Trade Council and the Embassy of Sweden here Monday.

“For the period of 2009-2011, the value of capital investments made by the companies exceeded SEK 1 billion in total,” it said.

Of the 137 Swedish companies surveyed, 96 percent said they were planning to increase their activities in India in the next three years — an increase of four percent compared to 2010.

The companies have on an average raised their revenues by 31 percent in the financial year 2010-2011 from 2009-2010.

“India with its continuous and strong growth during the last few years is becoming increasingly attractive and important to Swedish companies,” said Anders Malmstrom, Sweden’s trade commissioner to India.

He said the English language used in India was a highly favourable factor for these companies.

Malmstrom said: “Swedish companies also plan to tap sectors such as healthcare and energy which will increase employment opportunities even further.”

According to the survey, the companies cited bureaucracy and corruption as major challenges which make it difficult for Swedish companies to operate in India.

“Bureaucracy, corruption and taxation system, they are all linked to each other. If these things are done away with, confidence of Swedish investors will even be better,” said Lars-Olof Lindgren, ambassador of Sweden to India.

The common bottlenecks encountered by the companies were registration as a legal entity (72 percent), acquisition of land for commercial use (32 percent) and “financial challenges” (28 percent).

Also, the companies find that 53 percent of the blue collar and 39 percent of the white collar workforce are not “skilled enough”.

The Swedish companies well known in India include telecom equipment manufacturer Ericsson and compressor and machinery maker Atlas Copco.

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