See more investments into India: Indo-German Chamber

Indian Prime Minister Narendra Modi is all set to visit Germany from April 9 and Duetshe land is looking forward to his visit.

Although it is not his first visit to the country what makes it special is the fact that India is the partner country at the Hannover fair.

Speaking to CNBC-TV18'S Sanjay Suri, Bernhard Steinrucke, director general, Indo-German Chamber of Commerce said for decades now German companies have been active in India.

There are more than 1000 German companies in India employing hundred thousands of people. Moreover, they are highly profitable and so they reinvest but that is not seen as foreign direct investment, he added.

According to him investment of German companies much bigger than that of British or Japanese or Korean companies.

Investments made by German companies into India have always paid off and so they have reinvested. Going forward too they are waiting to make further investments once the market picks up, said Steinruckle.

Below is the transcript of Bernhard Steinrucke's interview with CNBC-TV18's Sanjay Suri.

Q: What are you expectations from PM Modi's visit?
A: German companies have been very active in India for decades. They were always the front runners actually whether it was after the second World War or whether it was when the reforms started in 1991 or after the Asia crisis in 2003.

Q: The popular impression is that it is British companies in the lead.

A: No, look at the numbers. More than 1,000 German companies active in India employing hundreds of thousands of people, big investments in many fields, market leaders and when you look at the proper investment including reinvestment then certainly the investment of German companies in India is much bigger than British companies or even like Japanese or Korean.

Q: We are talking Foreign Direct Investment (FDI) here.

A: We are talking FDI but you have to look also at the reinvestment. German companies are highly profitable in India and so they reinvest their profits and this does not show as FDI, that is the problem. So the numbers per se may not look as big but if you only look at the market capitalisation of the 20 odd German companies listed at the Indian stock exchanges then you will what numbers we are talking about, we are talking about billions of Euros.

Q: Now with the Modi government in, is there going to be yet more investment, are we going to see more new investment or more reinvestment?

A: I am sure we are going to see more investment but also there we have a challenge because German companies have been doing so well after 2003-2004, they basically had almost 10 years success after success, and in 2010-2011 they decided to expand and to invest. Today I am invited almost every month for a new factory opening. So from that angle German companies have invested, they now have the capacity and now they wait for the market to pick up again. Actually that is the right thing to do, when it is more quiet, then you invest so you are ready when the boom comes and therefore I can tell you many German companies are ready.

Q: People compare India and China always. How many German companies are investing in China relative to India? What is the level of optimism with investments in India in relation to China?

A: I am not a Chinese expert. German companies no doubt have invested big in China because China as you know had started their reforms some 15 years earlier than India and from that angle German companies are there and are big there. Of course, China has impressive developments.

On the other hand India will be growing faster than China in just another 2-3 years as per the latest research by the World Bank and IMF. From that angle India is a very important market for the German companies and therefore as we always say don't talk about India or China, talk about India and China. At the moment as per my feeling the focus is more on India rather than on China because in China German companies have already invested so much that now India I think is more attractive.

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