We are among the top investors in India

Written by Suman Tarafdar | Updated: Jun 28 2009, 06:47am hrs
Philippe Welti
The relations between Switzerland and India have never just been about the majestic Alps, lovely lakes and valleys - all of which have been definite musts for at least one school of Bollywood film-making. Of late, it is as much about precision machinery and not just watches but even giant ones making multiple facets of components that are making out daily life tick. Bilateral trade between India and Switzerland was worth 3.5 billion Swiss francs last year, though the growth of Swiss exports to India declined by 3.5%, largely attributable to the global economic downturn. Indian exports continued their upswing however means India will be able to seek details of bank accounts kept by citizens who are believed to have evaded taxes in India and deposited the money in overseas bank accounts. Recently appointed Ambassador Philippe Welti speaks to Suman Tarafdar on various issues pertaining to the two countries. Excerpts:

How is the relationship between India and Switzerland at the moment Where are the synergies working best

The structure of the relationship is complex, especially as Switzerland is highly globalised and is ideal for operating in Europe as it is not just central but also well integrated. There are huge synergies in the knowledge sectors, especially pharma, biotech, chemicals, IT, nanotech, life sciences.

What steps are being taken to address Indias concerns on bank accounts held by Indians in Switzerland Has their been any official communication from the Indian side

The Indian government has officially filed a request with the Swiss authorities for negotiations aiming at revision of the existing DTAA, which is the legal framework for specific request concerning bank account data release. The Swiss government has declared in general, its readiness to revise the existing DTAA with a view to fully adapt it to the standard of the OECD model convention.

Are there initiatives that the Swiss government is taking to enhance the ties between the two countries

The Swiss government is launching a project this year to provide vocational training to Indian students. Called Vocational Education and Training (VET), it is already operational in countries such as Singapore and the US and will be in place in India from September this year. The programme will offer opportunities for staff of about half a dozen Swiss companies based in India, who will be offered a dual education system, including apprenticeships in companies. The Swiss government is expected to invest nearly 1,00,000 Swiss francs in programme.

Any other initiatives in the offing

Switzerland has been active in India in various fields. An Indo-Swiss Joint Research Programme (ISJRP) was founded in 2004 by the Swiss State Secretariat of Education and Research and the Indian Department of Science and Technology with the goal of furthering cooperation in strategic scientific and technical areas relevant to Switzerland and India. The Swiss Development Cooperation (SDC) is working in western part of India in the area of adaptation to climate change. SDC is also active in the field of enhancing the energy efficiency in commercial buildings and small enterprises.

What is the extent of Swiss investment in India

We conducted a survey of Swiss companies operating in India and they have been positive in their response. Switzerland ranks among the top 10 investors in India. 160 Swiss companies have JVs or subsidiaries in the country. They employ about 20,000 staff in India. The largest employers are Nestle, ABB, Holcim. The main areas where Swiss companies are operating are largely at the high end of the value chain, in machinery, industrial equipment, production, financial services and food processing. Of late, there is an increased interest in SMEs as well.

What are the main challenges that Swiss companies entering India face

Setting up in India takes considerable time as the laws here are quite complex. Moreover, they also differ from state to state. Tax regulations can often be contradictory too.

Tourism from India declined in 2008 after many years. Is there anything the Swiss authorities are doing to boost this

In 2008, there was a decline by just 3% in overnight stays, about 3,30,000 last year. In the few years before this, the growth had been in double digits. It is still a preferred destination for honeymooners. Indian tourists largely opt for a tour and their favourite destinations continue to be Lucerne, Interlaken and Geneva.

Are the Swiss also looking at India as a destination for cultural tourism Or something more

The Swiss tourist is a discriminating one. The concentration is on the high end of the price bracket. Indian tourism has a lot of potential, and Agra is the first choice as destination for most Swiss tourists, followed by Rajasthan, Goa, Kerala and the Himalayas, where they go for trekking. India could try to encourage targeted tourism as some other countries have done.