Why is there a need for Indian Banks presence in Australiain an environment where 80 per cent of Australia's lending market is controlled by the major banks.
The cultural relationship between Australia–India plays a large role. Both these countries belong to the Commonwealth of Nations. As a strategic partner since 2009, Australia and India enjoy strong political, economic and community ties. India is Australia's fifth largest export market, and tenth largest trading partner overall. Investment has grown significantly over the past decade, as have tourist flows between both countries. Complementarity between economies, India's size and growth trajectory, and strong diaspora links all present opportunities for a closer economic partnership. Cricket has also emerged as a strong cultural connection between the two nations, as well as the English language following from British colonisation.
India - A land of opportunities
India is the world's fastest growing major economy, with forecasted growth of 7 per cent in 2017, and between 7.5 per cent and 7.8 per cent growth by 2020. By 2030, India is projected to be the world's third largest economy, currently the 7th largest, and this growth prospects are underpinned by the Indian Government's reform agenda aimed at creating jobs and improving the business environment; productivity catch-up due to urbanisation and a growing, young working-age population; and a continued structural shift from agriculture to services and industry. A key outcome of Prime Minister Turnbull’s April 2017 visit to India was his announcement that the Australian Government would commission an independent India Economic Strategy to identify opportunities for Australian businesses in India, following from this growth aspirations.
The two-way investment growth between Australia and India has seen exponential growth in both value, and in numbers, of companies establishing themselves across both markets. This two-way goods and services trade between Australia and India totalled $19.4 billion in 2015-16. Australian investment in India totalled $10.6 billion at the end of 2015, and Indian investment in Australia $11.6 billion. This represents significant growth on investment levels a decade ago.
Presently, there are more than 50 Australian companies with an established presence in India and South Asia region, involved in mining and resources, construction and design, health and medical, information technology and telecommunication, banking, finance and insurance, education, travel, food and beverage, logistics and a range of retail and business service exports. These companies are committed to the market and identify opportunities not only within India and South Asia, but additionally those they can reach through an enhanced globally competitive position from India. This allows for Indian Banks in Australia to provide financial services to Australian based companies looking to enter the Indian based market or require expertise in investing in India.
Equally encouraging is the growth of investments from India and South Asia into Australia, with India having strong domestic demand, and there is an expectation that this upward trend will continue. Indian investments into Australia as mentioned above has increased 10-folds over the past five years. This has primarily been in the resources and mining sector, agribusiness, education, hospitality, property development, retail and franchising, etc. For sustaining this Indian growth story, there would be an enormous demand for infrastructure development and energy resources such as natural gas and coal, and mineral commodities like gold and copper ore, with these growing demands driving Indian companies towards natural resource rich countries like Australia.
Role of Indian Banks in Australia
‘Follow-the-Customer’ relationship will result in opportunities for Indian Banks in Australia to meet the expectation of an increase in demand for a variety of trade related services and funding requirements for Indian based companies. Indian Banks in Australia will also be in a position to provide financial services, useful information and advice to Indian based companies looking to enter the Australian market. In the long run, this will result in better access or more certainty for Indian based companies to invest in Australia and this will help expand and diversify India’s export base.
Indian Banks in Australia have various products to help finance Indian-based customers or Australian businesses, which include buyers credit, ECB financing, term loans, working capital and trade finance requirements.
India is also the largest source of skilled migration to Australia, and the second largest source of international students. Census 2016 data revealed that Indian population in Australia has grown to 455,389, up from 295,362 recorded in Census 2011, which represents 1.9 per cent of Australia’s population of 24.4 million people. This does not include students studying here in Australia, with over 60,000 Indians studied in Australia in 2016 – an increase of 12.4 per cent from 2015. Over 200,000 Indians travel to Australia each year. Under the New Colombo Plan, 1800 Australian undergraduates are being supported to live, study and undertake work-based learning activities in India during the 2015-17 period. This all highlights the importance and the need for Indian Banks having a presence in Australia to serve the community.
Mr. Pankaj Kumar,
Union Bank of India,
Union Bank of India, Sydney branch started its journey in April 2009. Back then, it established a Representative Office which was later upgraded to Branch Office on 29.03.2016, in the presence of Shri Arun Jaitley, Finance Minister of India.
Union Bank of India was established on 11th November 1919 with its headquarters in the city of Bombay (now Mumbai).
The Head Office building of the Bank in Mumbai was inaugurated by Mahatma Gandhi in the year 1921. On the occasion he said:
"We should have the ability to carry on a big bank, to manage efficiently crore of rupees in the course of our national activities. Though we have not many banks amongst us, it does not follow that we are not capable of efficiently managing crore and tens of crore of rupees."
His prescient words anticipated the growth of the bank that has taken place in the decades that followed. The Bank now operates through over 4200+ branches across the country and has branches at International financial hubs like Hong kong, Dubai, Antwerp and Sydney. Union Bank has established its own subsidiary in London. The Bank's core values of prudent management without ignoring opportunities is reflected in the fact that the Bank has shown uninterrupted profit during all 96 years of its operations.
Global Business of Union bank of India is USD 105.31 Billion. The Bank has a large clientele base of over 57 million.
Union Bank of India, Sydney branch is giving more thrust on funding to Real Estate, Mining, Agriculture and services sector to become part of growth of Australian economy.
Union Bank has been playing a very proactive role in the economic growth of India and it extends credit for the requirements of different sectors of economy. Industries, exports, trading, agriculture, infrastructure and the individual segments are sectors in which the bank has deployed credit to spur economic growth and to earn from a well-diversified portfolio of assets.
Disclaimer: The thoughts and opinions expressed here are those by the contributors alone and do not represent the views of any other organisation, the forum moderator or that of Aei4eiA.
Please send in your feedback/comment (if any) to firstname.lastname@example.org
Email us: email@example.com
Connect with us:
Leveraging 'People' Power of Sustainability