IndusView has predicted that bilateral trade between India and Europe would reach $100bn by 2010, fuelled by the fervent mergers and acquisitions activity between the regions.

Last year, Indian companies spent about $10bn on overseas acquisitions, with Europe accounting for 42% of the companies acquired. India received investment of almost $20bn, half of which was private equity.


But factors that are due to come into play in 2007 are set to put 2006’s economic growth in the shade, according to Bundeep Singh Rangar, chairman of IndusView.

“While 2006 was an incredible year of firsts for India, such as Infosys’ listing on the Nasdaq-100 and record growth in foreign cash reserves and gross domestic product, this is just scratching the surface of the country’s potential,” he said. “Thanks to factors such as the approval of 150 special economic zones and the ongoing development of the relationships between Indian leaders and those from overseas, 2007 promises to be a landmark year in India’s history.”

Mr Rangar also predicted that external Indian investment would rise in 2007, as European companies became viable targets for organisations looking to strengthen their portfolios and take advantage of the highly skilled labour force at their disposal.

“With Indian companies investing $2bn in the UK alone in 2006, 2007 could see a European land grab as Indian prospectors search out ways for them to improve their footing on the international stage,” said Mr Rangar. “With many industries reporting astonishing growth in 2006 – such as 28% in IT, 35% in consumer finance and 42% in healthcare – there is certain to be more investment overseas, meaning more jobs, healthy economies and increased trade.

“In 2007, we don’t just expect this growth to be sustained; we expect it to continue on its path and eventually take India into the top five economies in the world.”