While the surging growth of China has been a centre of attention in recent years, there is another rapidly growing market on Australia's other doorstep, India.
The Indian market is expanding rapidly - and opening opportunities for a wide range of Australian exporters.
India has a population of more than a billion people. There are six cities with over 4 million people - Delhi, Mumbai, Chennai, Kolkata, Bangalore and Hyderabad - and 23 with more than one million.
The middle-income group is one of the fastest growing in the world and now numbers more than 200 million people.
Current trade between Australia and India is worth about $2.7 billion, with a surplus in Australia's favour. Australia's exports are mainly raw materials such as coal, ore, wool and cotton, while import from India include fabrics, clothing, metals and gems.
The following markets are just a few examples of the opportunities that are expected to arise over the next few years:
Housing construction also is expected to generate ongoing demand. The growth of the urban population has accelerated and a United Nations study has forecast that it is likely to increase further over the next decade.
India is giving high priority to the transport infrastructure sector, particularly roads, ports, railways and airports. While primary responsibility for development and management of transport infrastructure has traditionally rested with the central and state governments, it is increasingly opening up to private sector involvement.
The Confederation of Indian Industries (CII) estimates that the nation's environment market will expand from $US2 billion to $US7 billion by 2010. There is growing demand for both products and services.
In particular, the Pollution Control Equipment market is expected to continue to grow by about 10-12% annually and is already valued at US$3 billion. This is as a result of increased government efforts to reduce industrial pollution. There are also opportunities in the automotive market, water/wastewater and solid waste management.
Food and agribusiness
Although India is a major producer of agricultural, horticultural, dairy, meat, fish and related products, its processed food industry is less developed when compared to other countries in the region. It is estimated that only about 2% of its fruit/vegetable production is processed. There are opportunities in areas such as processing, packaging, technology and distribution, cold chain and post harvest logistics.
As Indian society changes there is also a growing market for the snack and convenience food segment. It is estimated that the average Indian spends about 50% of his household budget on food items.
Health, Medical Equipment and Biotechnology
Following the phenomenal success of its information technology industry, India is fast emerging as an important player in the biotechnology sector with a large pool of scientific talent available at a reasonable cost and a wealth of R&D institutions.
There is also demand for medical infrastructure as the Indian Government struggles to meet the needs of the population. Health care spending is estimated to be about US$30billion pa. As India's society changes its disease profile changes as well. Treatment for lifestyle diseases is expected to become a major market in the future and will require heavy investment in equipment and technology.
Mining equipment and services
India is a large market for mining equipment and services and offers a wide range of opportunities to overseas exporters and investors. The mining equipment market was estimated to be worth $US2 billion at the end of 2005. There is also significant demand for used or reconditioned equipment at the right price.
As the Indian manufacturing sector continues to grow at a healthy 9% pa there is an increased demand for machine tools, particularly in the automotive, auto components and consumable durables sector. It is estimated that the machine tool market grew to US$770 million in 2005 with imports accounting for over 60% of the market. Most of the local industry is located in the South and West regions of India, with HMT being the largest local player with about 40% local share.
Ai Group's assistance into India
For more information on the opportunities in your sector, firstname.lastname@example.org
For further information about trade links with India contact Ai Group National Manager - Trade and Export Development, Louise McGrath.
Many foreigners may not be familiar with the terms "crore" and "lakhs" which are used regularly in India's financial jargon. These terms have also been used throughout this page. Please note that a lakh equals 100,000 and a crore equals 10 million.