India Culture of Business

By | July 24, 2022

Subchapters:

  • Introduction
  • Addressing
  • Business Meeting
  • Communication
  • Recommendations
  • Public Holidays

Introduction

The following paragraphs offer a basic orientation to the formal and informal rules and customs that apply to conducting business in India. It goes without saying that these standards differ in many ways from what we are used to in our country. The key to success in the territory is finding a capable and trustworthy business representative or partner who will be key in overcoming the many complications given by the significant cultural, mental and linguistic differences of the local environment. When dealing with local sales representatives, partners, project sponsors or clients, and building a personal relationship with them, the following basic lessons can be useful.

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Addressing

In India, personal contact is preferred in business dealings and personal acquaintance and trust play a big role. In order to establish an initial business contact, it is therefore ideal to go to the territory in person – e.g. as part of a visit to a fair, exhibition or conference. Of course, personal recommendation or mediation also works in India, e.g. through already established companies, traders or intermediaries. The Embassy of the Czech Republic in New Delhi can also help with establishing an initial contact, which through a commercial and economic diplomat can forward the contact, arrange a meeting, etc. The PaulTrade Export Support Agency also operates in India, which has commercial offices in Mumbai and Bengaluru. Based on the specific requirements of companies, PaulTrade provides assistance services, consultations in the field of business, establishment of a company, carries out marketing market research, searches for suitable business partners and can possibly verify their interest in the product offered. To verify the market potential for a Czech product or service and to find customers and partners, you can also use local consulting companies, chambers of commerce, or industry associations. An alternative channel for entering the Indian market, especially for smaller sellers, is the use of online marketplaces. E-commerce is extremely widespread in India and the volume of goods sold online is expected to reach USD 70 billion by 2021, mainly through platforms such as Amazon, Flipkart, Snapdeal and eBay. Although India is a traditional and conservative society where face-to-face personal contact is strongly preferred during business negotiations, the corona virus pandemic has forced a certain flexibility and change in social and business practices.

Business meeting

In India, great importance is attached to personal acquaintances, especially in the business and political spheres. Therefore, it is advantageous to arrange the first meeting on the recommendation of an intermediary who is familiar with the Indian businessman. For example, an established Czech company, the Embassy of the Czech Republic, or the PaulTrade office can help with mediation. Meetings are often only confirmed right before the meeting itself, and the dates and times of meetings can change continuously. Even so, I recommend the punctuality that Indian partners expect from their European counterparts. The initial meeting is usually more formal and can be arra

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nged in the morning or afternoon hours of the working week. The right hand greeting is a common practice in India during business negotiations. It is also possible to greet a business partner with the traditional Indian greeting “Namaste” – palms folded in front of the chest with fingers pointing upwards, a sign of bowing and saying the greeting “Namaste”. The Namaste greeting is a safe bet, especially when it comes to greeting women, when depending on the age and status of the woman, it is not always clear whether the classic “handshake” is appropriate. Indians are very tolerant of hierarchy, so it is necessary to be the first to greet the highest-ranking representative of Indian society.

On every occasion, it will be necessary to exchange business cards, which are sufficient to have in the English language. They are passed with both hands, or with the right hand, in writing facing the person in front of you. Accepted business cards need to be given due attention – too careless acceptance and immediate establishment of a business card may not look good. In general, food, drinks and things that are passed to another person are always taken in the right hand. In the Indian concept, the left hand is used for so-called “unclean activities”, such as the toilet or putting on shoes. Gifts are not expected at the first meeting. On the contrary, e.g. at the final meeting where the contract is signed, it is appropriate to give gifts (e.g. Czech glass). At the beginning of the meeting, space is usually given for so-called “small talk”, i.e. questions about current knowledge of India, travel, family, professional and personal interests, etc. It is not recommended to rush or neglect this phase of the meeting, and proceed immediately to business negotiations – if you are not sure of the optimal timing, let your Indian business partner guide you. Be aware that the pace of negotiating and closing deals is generally slower in India than in the West. Indian businessmen prefer personal contact and it is extremely important for them to know their business partners well. Bringing the deal to a successful conclusion will therefore usually require a series of repeated negotiations and frequent personal visits to India. Negotiations with Indian partners are usually very cordial, Indian businessmen know how to skillfully conduct a conversation and will greatly appreciate it when their Czech partner shows interest in their country and shows that they also know something about it. During negotiations, it is necessary to take into account that not every positive expression of the Indian partner is really meant seriously, because it is not in the mentality of Indians to answer something “no”. Therefore, answers like “maybe”, “we’ll see” or “we’ll try” can often indicate that the Indian counterpart is not willing to follow through. Excessive emotions, temperament, irritation or angry reactions are definitely not expressions that will earn you the respect of your counterpart in India. On the contrary, a rational and pragmatic approach, politeness and almost inexhaustible patience are appreciated. In India, it is absolutely crucial that partners maintain face at all times during negotiations – there must be no insult, humiliation or embarrassment.

It is likely that, after a certain time, business meetings will be accompanied by an invitation to dinner or a business lunch. On these occasions, the primary topic will not be business, but rather a deeper understanding of the business partner. As for dining itself, keep in mind that Hindus are not allowed to eat beef, as the cow is considered a sacred animal in their religion. Naturally, the Muslim minority in India does not eat pork. Strict separation of portions into vegetarian and non-vegetarian is completely natural and common in communal dining in India. Muslims, as well as devout Hindus, often strictly avoid alcohol, which may not be served at all in some restaurants. After all, the sale of alcohol is significantly restricted and regulated in India. On the other hand, very expensive alcohol (especially whiskey) is popular among wealthy Indians. Alcohol as a gift for an Indian partner thus requires that you know him to a certain extent and be able to judge whether it is a suitable gift in his case. Indians expect more formal attire from their Western business partners during negotiations, i.e. for men a suit or at least a jacket (smart casual), and for women a business suit. In traditional industries such as banking, a suit and tie is required. It is not recommended to wear skirts that are too short or showy necklines. Depending on the season or the weather, e.g. in the hot summer months, it is permissible to put away the jacket and conduct the meeting in a shirt. Given that certain segments of Indian society are still very conservative and hierarchically oriented, your negotiating team should be composed of high-ranking and socially well-situated representatives of Czech society. Definitely, junior company representatives should not be sent to meet senior representatives of an Indian company. Ideally, the head of the negotiation team should be the director/executive of the Czech company, or at least his representative, or a high-ranking manager of the company. This will show the importance of the meeting and respect. Indian corporate middle management does not have the authority to decide on the conclusion of important business transactions – only the top executive management of the company has this authority. Therefore, try to deal with the highest-ranking company representative – you can usually recognize him by the fact that he is the first to enter the door at the meeting, starts the meeting or sits in the middle of the meeting table, and his colleagues show him respect in every possible way.

Communication

The advantage when dealing with Indian business partners is that most of them have a very good knowledge of English and the high availability of information sources, including, for example, business legislation, in this language. However, due to the specific accent of Indians and slightly different vocabulary, Indian English can sometimes be more difficult for us to understand. It is not necessary to provide an interpreter for a business meeting if you are confident in English and have already gotten used to the specific Indian accent. When addressing people, it is recommended – especially at first – to be addressed formally by the last name, e.g. Mr. Kumar, etc. Indians in the local hierarchical society tolerate their titles, so we recommend addressing partners by their functional title, e.g. doctor or professor, etc. In the later stages of negotiations, it is possible that you will be offered a less formal address by your Indian partner and more ease. Visit Animalerts for more information about India culture and traditions.

As already said, Indians want to get to know their business partner, and therefore they will ask him a large number of personal questions about family, children, social status, etc. It is necessary to be tolerant of this questioning and patiently answer all kinds of questions that may not be related to business not related at all. At the same time, it is good to show an appropriate interest in the personal life of the Indian counterpart, to remember, for example, the names of his children, and at the next meeting to ask how they are doing. Indian partners will appreciate the interest and knowledge of Indian realities on the part of Western partners, previous knowledge and, for example, traveling around India can thus benefit the building of trust and a relationship with an Indian partner. On the contrary, we do not recommend too open and especially critical discussions about Indian politics, religious and ethnic problems and other sensitive topics. It is also necessary to keep in mind that the post-colonial syndrome is still rooted to some extent in India. This can lead to a certain oversensitivity of the locals, who may interpret overly confident or domineering behavior on the part of white, Western visitors, as superiority or arrogance. We recommend continuing to call Indian cities by their post-colonial names (e.g. Bombay is called Mumbai).

After establishing personal contact, all commonly used forms can be used for communication, including extended communication via e-mail. Undoubtedly, the most widespread form of communication in the country is currently via the WhatsApp mobile application, even in business or official relations. With the corona virus pandemic, communication through various video conferencing platforms, which are currently widely used for business meetings, webinars, etc., has fully penetrated into India as well.

Recommendation

Before traveling to India for a business meeting, it is definitely worth studying and researching this exotic territory, local rules, culture and customs, which are very different from our standards, as carefully as possible. It is necessary to know at least the basic cultural realities and differences, and to respect them – this way you will gain the recognition of the locals. Be aware of the exceptionally high number of public and national holidays, some of which may last for several days, and may make it impossible to carry out business negotiations on a given date. It is very useful to have a local mediator or cultural guide who can give advice and offer an Indian perspective. It is necessary to be adaptable and flexible – negotiations will not always develop according to your wishes. If at all possible, plan to visit India a few days longer than is absolutely necessary to complete the negotiations. Meetings can be canceled or moved, the time reserve will also come in handy for related social events (dinners, lunches, festivals, time for building relationships, etc.). A too short visit or neglecting social events can give Indian partners the impression that the Indian market is not very important to you. Build relationships with key decision-makers, whether they are your business partners, important clients or representatives of the government and civil administration.

Public Holidays

A large number of holidays are celebrated in India, which is due to the multi-ethnic and multi-religious nature of the country. There is no uniform or exhaustive list for the whole of India. The 3 most important national holidays are: Republic Day (January 26), Independence Day (August 15) and Mahatma Gandhi’s Birthday (October 2). For the majority of the population, which is made up of Hindus, the main holidays are Diwali and Holi, the date of which is variable. An exhaustive list of Indian holidays and other information is available, for example, on Wikipedia.

India Culture of Business