The 1st IISS-Citi India Global Forum
India as a Rising Great Power:
Challenges and Opportunities
New Delhi, 18–20 April 2008
OPENING REMARKS
Sir Win Bischoff, Chairman, Citi, US
(Provisional transcript as delivered)
Introduction
Good evening Mr Minister, your Excellencies, ladies and gentlemen. Thank you very much John for your introduction. On behalf of our entire organisation in India it is a great pleasure for me to welcome all of you to the first annual International IISS India Global Forum. We hope hereby to foster a greater understanding of the current economic, business and political dynamics that affect public policy. Somewhat remote you might think from our normal financial objectives, but none the less important for that.
This is the first year of the conference and we certainly hope that it will not be the last. We are honoured to partner in this endeavour with IISS, an esteemed and respected institution that for 50 years has made an important and lasting contribution to the global dialogue around issues of international relations. During this conference we will cast a keen eye towards Indian growing importance as a global economic power, and its influence on public policy internationally.
Market Overview
Tonight I have the distinct privilege of introducing the Commerce and Industry Minister of India, Kamal Nath, to make a few remarks. Before I do so I would like to share a brief overview of this important market from our perspective. I am proud to say that Citi Group has had a special relationship with India for many years. We have been a presence in the Indian market since 1902, the year we opened for business in many markets in Asia, and coincidentally, almost as an afterthought, also in London in the same year. We have witnessed at first hand as the country has grown and prospered, and we are privileged to have been an integral part of that growth story.
We have prospered along with you, and Citi now employs in India more than 22,000 people, and maintains more than 7 million customer accounts. While we are entirely local in our presence, we are proud of our key differentiator in the ability to offer global linkages to help Indian entrepreneurs and corporations navigate outside India, a fact that has been so frequent recently, both in M&A activities, leveraged finance and to raise capital.
SMEs
Among our main achievements, let me just say a word about something that is not as perhaps quite as well known, which is our work with small and medium enterprise (SME) clients, which is such a major driver of the Indian economy and, interestingly enough, a major driver also increasingly of some of the other countries in the other emerging markets. Indeed, SMEs contribute nearly 40% of India’s domestic production, almost 50% of India’s total exports, and 45% of India’s industrial employment. Citi was the first bank to set up a dedicated strategic business unit focused on emerging local corporations. We wanted to participate as a consistent and committed player in the local financial markets rather than as a niche international bank. This strategy has served us well, and we now number amongst our clients well over 2,000 SME clients, with an India footprint over 27 cities.
Also, in line with national priorities, financial inclusion is an integral component of our India strategy. Over the last two years, in partnership with micro finance institutions, we have been able to reach out to over 650,000 un-served or underserved borrowers. We have extended our micro credit programme across 15 states, and we promote micro savings, in part by introducing an innovative zero cost savings product called Pragati.
As part of this effort we have developed biometric ATMs, which through thumbprint recognition, colour coded keys, and voice queues, allows less literate customers to use basic banking services. This is a tremendous effort, which has been initiated here. Through our Citigroup foundation Citi India’s community support programme was launched in 1997 to focus on non-governmental organisations working to provide micro finance to empower under-privileged urban women.
International Business Strategy
India is an important country for our international business strategy. It is one of our largest, most complex, and organically-grown markets. We are committed to being a partner in the cooperative spirit of improving the lives of people in the communities in which we live and work. We will continue to invest here and play a constructive role to facilitate additional economic growth.
Clearly, as one of the leading emerging markets India has become a strong economic player in the world. You know the figures, the annual GDP growth has been 8%, it has a strong growing middle class of more than 300 million people, Indian companies are becoming more ambitious, acquiring companies abroad – Tata in terms of Corus and Jaguar are well-known examples, but only examples of this. India has all the components that are key to stable growth: growing consumption rates, a young population, increasing investment in industrial capacity, innovative entrepreneurs, and a pool of highly skilled workers and, of course, not to be forgotten and very basic, a strong democratic set up, which has stood the test of time. It is because of these factors that we see substantial growth opportunities in India, and the opportunity to build upon the extraordinary economic and international achievements of this country over the past 15 years.
Citi believes that India is maturing towards becoming a major economy, with, I hasten to add, correspondingly greater responsibilities in the global financial system and economy. As India’s largest foreign direct investor in the financial services industry, we look forward to working with the government and the various agencies to attract more foreign direct investment (FDI) into the country.
Minister Nath
One of the strongest advocates within the Indian government for increased FDI and a resounding voice in public policy discussion on many critical issues is our honoured guest, who I have the pleasure of welcoming now. Mr Kamal Nath is India’s Minister for Commerce and Industry, a position that he assumed in 2004. Under his tenure a comprehensive foreign trade policy has been announced, laying out a coherent roadmap with a twin focus on exports, as well as employment. Major bilateral trade initiatives have been taken with countries like China and Pakistan, and there has been significant progress in the area of regional trade developments.
Mr Nath has been recognised for his personal commitment and active efforts to attract foreign companies to India, and to promote free trade, resulting in a substantial increase in FDI in India, a rise in export volumes, contributing to a virtual cycle of commerce and continued economic development. Earlier in his career Minister Nath served as a long-time member of parliament and as Minister of Environment and Forests, where among many other achievements he made a remarkable contribution to the annunciation and development of the National Policy on Ecological Conservation and the Abatement of Pollution. He also served as India’s Textile Minister, where he helped to launch the new Textile Policy.
Additionally, and this is a little plug, he has become an author, and is publishing a book through McGraw Hill, of which I happen to be a director, and I highly recommend that you read it. So it is a distinct honour and privilege to introduce a highly respected minister and a very good friend, Minister Kamal Nath.
