Posted: 2016-06-13 09:11:35 by
Hong Kong and Singapore are serving as a gateway of opportunities attracting an ever increasing number of countries including India to be a preferred platform for new business start-up or to expand the already existing business and taking it to global levels! Earlier the trend for setting up companies was in London and New York and now it is shifting towards Hong Kong and Singapore.
Indian Companies too are raising money and setting up holding companies or setting up headquarters in Hong Kong and Singapore. The ease of operations, tax regulations, fund raising and several other advantages are working well towards considering these countries as the hub for new ventures and global expansion by the Indian companies.
Hong Kong and Singapore are ranked 3rd and 1st respectively in ease of doing business index globally, so there is an advantage for companies in India to have a holding company or headquarter in Hong Kong and Singapore.
Global companies that are planning to enter India for expansion plans, setting up of new businesses and FDIs that are planning to invest in Indian Infrastructure and Real estate story will find tough to bear fruit in India due to long and aching procedures laid down by government, clumsy processes, faulty logistics and double taxation rules. Thus making the efforts futile for the global companies to enter Indian market and benefit from the opportunity.
Hong Kong and Singapore is easy solution to enter Indian Markets.Procedures in India will get smooth and easier with time but to take the advantage of growing Indian economy the global companies and financial institutions that are planning to invest in India should -refer to use Hong Kong and Singapore as the gateway to enter India. Foreign Direct Investment (FDI) interested to invest in India can use Hong Kong and Singapore to route billions of dollars investment
Moreover, the ease of mobility to and from Hong Kong and Singapore has made them extremely viable for trading and business purpose. A whooping 3.5 billion people base over Asian nations can be covered within 5 hours of traveling radius from Hong Kong apart from connecting to the seven million residents within the country itself. Besides the internal travel time is reduced largely owing to the new high speed trains and a project
connecting Hong Kong to Macau via Sea Bridge that shall be completed soon.
Singapore witnesses highest traffic on sea being the world’s largest and busiest bunkering and trans-shipment port thus making it most preferred place for commodity trading. The sprawling sea lanes connecting Singapore to India makes India more at ease in transporting requisite goods and focusing on Singapore as a handpicked location for business expansion plans.
The cosmopolitan culture of Hong Kong along with its huge capital flow volumes ranked amongst top five in the world, entrepreneur culture, easy portability, freedom of speech, low tax rates, easy availability of internet and higher mobile penetration are all contributing largely for it to be chosen as the central place for global operations.
Likewise Singapore is also a preferred location owing to quick business registration process, half corporate tax rates as compared to India, definitive Double Taxation Avoidance (DTA) treaty, port and cargo handling efficiency, USD 1.4 trillion of wealth under management, superior technology and speedy connectivity between the nations. The turnaround time of Singapore court is also far less than the Indian courts also making it an arbitration capital for Indian legal disputes.
According to BCG, together Singapore (USD 1.4 trillion) and Hong Kong ($2.2 trillion) are poised to overtake global leader Switzerland ($3.7 trillion) by 2015 in terms of wealth under management.
Several Indian giants like HCL, Wipro, Adani’s, Tata’s, Accenture and many others have identified this opportunity and extended their arms into these regions. While HCL has shifted its research and development center to Singapore, JSW steel has opened a new coal trading division there to meet a massive requirement of 20 million tons of coal. The Singapore commodity exchange (SGX) is the fastest growing exchange in the world thus attracting many Indian companies to dig their fortune here. Serving as the largest oil trade center in Asia, Singapore also attracted Reliance being India’s largest oil refiner to start crude and fuel trading.
Similarly Hong Kong is captivating many SME’s from all over the world catering to varied industries such as IT, Real Estate, Engineering and Financial technology with an estimated 600-800 new companies functioning with Hong Kong as their global base.Of these SME’s, a surprising 80 percent of the entrepreneurs are non-residents of Hong Kong and belong to different nationalities realizing the country to be a gateway to their world. Established companies such as Accenture has launched their fin-tech accelerator program here while Indian SME’s like Smart Homes are conveniently headquartered at Hong Kong making it their global operation hub and penetrating into various countries from here expanding their real estate business . Currently SME’s from over the world account for 90% of Hong Kong’s GDP making it evidently one of the strongest gateway to the world for most of the countries.
Irrespective of the sector the company is dealing in, both the regions are increasingly becoming the financial base and headquarters for Indian start-ups, SME & MNC’srealizing well that the potential to expand at requisite pace and more favorable conditions can only be explored to its zenith being stationed here.
I perceive both regions to play a major role in opening the doors of the world for India due to the ease of doing business in these regions as compared to India. The favorable tax treaties and absence of bureaucracy and supportive initiatives from government within these countries makes it easier to connect to global clients at large and rapidly expand businesses. Besides the cargo handling efficiency and exports rule in these countries are more flexible and favorable compelling more Indian companies to function from Singapore and Hong Kong.
The twenty first century is witnessing the glory of Asia, rising as the fastest growing economy across the world with Singapore and Hong Kong marking the silver lining and serving as the global base for several Indian start up’s , SME’s and multinational companies!