Austria Attracting Indian SMEs

Austria, one of the richest countries of the European Union (EU), has strong trade ties with other European nations. In recent times, the Austrian economy has been growing at a steady pace, with its gross domestic product (GDP) growth rate hovering around 1.6% in 2008.

Austria is geographically close to several developed economies in Europe, such as Germany, Italy and Switzerland. It is also a preferred trade destination owing to its optimal access to the European market.

The present Austrian government has outlined a comprehensive economic reform programme to create a business-friendly environment in the country. It has also initiated efforts to strengthen Austria’s position as a lucrative investment destination. Motivated by the steps taken by the Austrian government to increase foreign direct investment (FDI) in the country, a growing number of Indian SMEs are entering the Austrian market to gain maximum profits.

Indo-Austrian trade relations

Austria’s proximity to the thriving EU countries makes it a strategic link for Indian SMEs eyeing expansion in Europe. As a result, bilateral trade between India and Austria has grown at a healthy rate in the past few years. Notably, total trade between India and Austria was pegged at $769.02 million in 2007-08, significantly higher than $587.09 million recorded in 2006-07.

India imports transport equipment, paper, machinery, steel, Chemicals Products and metals from Austria. While India’s export basket for Austria comprises coffee, leather and leather goods, chemicals, textiles, jewellery and precious stones.

Industry Experts believe that there is ample scope for mutual cooperation between Indian and Austrian SMEs in areas like food processing, biotechnology, tourism, steel and pharmaceuticals. Indian SMEs can also forge strategic tie-ups with their Austrian counterparts to gain technical expertise in fields like electronics, nanotechnology and telecommunications.

forums

To promote bilateral trade between India and Austria, governments of both countries have set up a Joint Economic Commission (JEC), which is actively involved in enhancing trade volumes between the two countries. There is also the Austria-India Interest Group (AIBIG) in Vienna that promotes trade ties between Indian and Austrian SMEs.

In 2007, an agreement on science and technology (S&T) cooperation was signed between India and Austria to take the bilateral relations to the next level. These efforts are expected to play a major role in strengthening Indo-Austrian trade relations in the near future.