Population (2019): 83.13 million
GDP (2019): US$ 3.84 trillion
World Bank “Ease of Doing Business” Rank (2019): 29
Bilateral Trade with India (Apr-Feb, 2019-20): US$ 21.98 billion
Germany is the largest economy in Europe with a GDP of US$ 3.84 trillion. The country excels in innovation, with 277 international patents per one million inhabitants – more than anywhere else in the world. It also leads the world in automobile manufacturing, transportation infrastructure, and green technology.
In addition, Germany is an attractive gateway for international companies to enter Europe. Despite the relatively higher cost of doing business in Germany, it stands out for its central geographical location, modern finance system, and highly developed infrastructure.
You can take advantage of the prompt connections for your goods and employees with Germany’s web of roads, railways and international airports. The airport in Frankfurt is a key aviation hub, while the Port of Hamburg is the third largest container port in Europe.
The German economy’s core strengths are in manufacturing and exports, backed by a highly-skilled workforce. Since the mid-1990s, manufacturing’s share of Germany’s GDP has generally held steady at 22-23%.
Your business can capitalise on the reliability of this sector and provide outsourcing services to German manufacturers in the areas of aerospace, food, furniture, medical technology, and offshore wind energy.
Germany has one of the most competitive and innovative manufacturing industry sectors. The sector accounts for a large share of the German economy, at 21% and 7.7 million jobs.
In the European Union, German firms account for over a quarter of manufacturing turnover and for over a tenth of global exports of manufacturing products.
The German government recognises that the digitalisation of manufacturing, also known as advanced manufacturing or Industry 4.0, is vital to maintain its lead in the manufacturing space. The aim of the government’s “Industrie 4.0” initiative is to increase manufacturing productivity levels by up to 50% and halve the amount of resources required.
The foundation of the country’s manufacturing success is built on very proficient, small and medium-sized companies called the Mittelstand that emphasise “making things”. They account for around 70% of all manufacturing exports and almost 80% of employment.
Your business can seize opportunities in the range of German industries that include automotive, chemicals, electrical equipment, and machinery.
In addition, there are many opportunities for foreign companies to co-create technology solutions with German companies. You can partner key German industry clusters and research institutes, such as Fraunhofer IPA, for intellectual property transfer and co-development.
Germany is a top e-commerce market in the European Union. Its e-commerce revenues of US$ 71.4 billion in 2019 are expected to show an annual growth (CAGR 2020-2025) of 6% resulting in estimated revenue of US$ 117.01 billion by 2025.
This is driven by its large population of 82 million, high Internet penetration rate and millions of consumers making online purchases regularly. In addition, the buyers are savvy online shoppers who have high levels of purchasing power. User penetration for the German e-commerce market is expected to hit nearly 81.9% by 2025.
Besides the attractive German e-commerce market, businesses can consider Germany as a springboard to ease entry into other European markets. Germany is positioned in the centre of continental Europe with a web of interconnected transportation options for swift connections. In the e-commerce world, shipment time is crucial for customers.
On the other hand, if you are an e-commerce solution provider, or offer warehousing or logistics services, you can tap into opportunities to provide the capabilities, solutions and networks for German firms into Asia.
Germany is a key connecting hub in Europe for both physical goods and virtual data, offering you opportunities in areas like data centres, infrastructure, and logistics.
Germany has a large infrastructure and construction market estimated at € 55.6 billion in 2016. The market is projected to reach €70.3 billion by 2021, according to Timetric’s Infrastructure Intelligence Center.
In the virtual data space, Germany is building the foundation for a digital future with plans to introduce the new 5G mobile communications standard by 2025.
In the meantime, the German government will expand the deployment of fibre optic infrastructure, as well as mobile communications capacities in central and rural regions. The goal is for 98% of households in Germany to have an internet connection with a minimum of 100 megabits per second by 2022.
You can also consider partnering German firms to identify technology demand for Asia infrastructure projects across various infrastructure verticals like buildings, renewables, and transport, and utilities.
Germany is a major trader in key commodities, and electronics products and components. Its top commodity exports are gold, petroleum gas, silver and refined petroleum, and wheat.
This presents opportunities for businesses in the commodity trading sector, like brokers, exchanges, financiers, price reporting agencies, and trade platforms.
Germany’s sizeable € 191.5 billion electronics and micro-technology industry employs 872,000 people. It boasts an exceptional number of renowned R&D institutes and world-leading manufacturers and suppliers in the electrical and electronic space.
German electrical and electronics firms manufacture more than 100,000 different products and systems. These include automation systems, electrical household appliances, and electronic medical equipment.
Your business can seek opportunities for partnerships with German and European Union electronics traders and distributors. You can consider expanding into Europe through a partnership with emerging business-to-business online trading platforms in Germany and the European Union.
Germany has a vibrant startup ecosystem concentrated in Berlin and other tech hubs. There are an estimated 1,800 German technology companies in 2017, with more than half of the startups found in Berlin, Hamburg, Hannover, Rhine Ruhr, Munich, and Stuttgart.
The German government has thrown its support behind the technology sector with the Digital Agenda 2020 initiative, aimed at making Germany the “No. 1 digital growth country in Europe
Germany is India’s eighth largest trading partner overall and the largest trading partner in Europe. India was ranked 28th in Germany’s global trade during 2019. Total trade between the two countries was recorded at US$ 20.98 billion in 2019-20 , with India’s imports at US$ 12.39 billion and exports at US$ 8.58 billion.
Germany is the 7th largest foreign direct investor in India since April 2000. Germany’s total FDI in India from April 2000 until September 2020 amounted to US$ 12.39 billion.
A Fast-Track System for German companies has been set up in the Department of Industrial Policy and Promotion (DIPP). To facilitate the entry of German Mittelstand (Medium Sized Companies) in India, the Embassy of India, Berlin runs the Make in India Mittelstand (MIIM) Programme since September 2015. Currently, 117 German Mittelstand (MSMEs) companies are being facilitated through the MIIM Programme for market entry and investment in India.
Indo-German Science & Technology cooperation started with the signing of the Intergovernmental S&T Cooperation Agreement in 1971 and 1974. There are more than 150 joint S&T research projects and 70 direct partnerships between Universities of both countries. India’s scientific establishments have close partnerships with German R&D institutions, including the Max Planck Society, Fraunhofer Laboratories and the Alexander von Humboldt Foundation.
India and Germany have a long tradition of academic and cultural exchange. Max Mueller was the first scholar of Indo-European languages to translate and publish the Upanishads and the Rigveda. There has been growing interest in Germany in Indian dance, music and literature, as well as motion picture and TV industry, in particular Bollywood. Indian films and artists regularly feature at the Berlin International Film Festival and at festivals across Germany. German interest in the Indian philosophy and languages resulted in the setting up of the first Chair of Indology at the University of Bonn in 1818. The Government of India has funded 31 short term rotating chairs of Indian studies in German Universities so far.
There are nearly 1.5 lakh Indians and people of Indian origin (2017 figures) in Germany. The Indian diaspora mainly comprises of professionals, technocrats, businessmen/traders and nurses. There has been an increase in the last few years in the number of qualified Indian professionals in Germany in the fields of IT, banking, finance, etc. There are a number of Indian organizations and associations active on the business/cultural front, cementing ties between India and Germany at the people-to-people level. More than 15,000 Indian students are pursuing various courses in Germany.
Machinery; organic chemicals; electrical equipment; apparel and clothing, knitted or not knitted; vehicles; articles of iron and steel; footwear; articles of leather, saddlery and harness; pharmaceutical products.
According to ITC Trade Map, India currently has an untapped export potential of US$ 6.4 billion to Germany led by motor vehicles, medicaments, silver jewellery and t-shirts.
Machinery; electrical equipment; optical and photographic; vehicles; plastics, organic chemicals; miscellaneous chemicals products; iron and steel; articles of iron and steel; commodities n.e.s.
Indian embassy in Germany
Address: Tiergartenstr.17 10785 Berlin, Germany Telephone: 0049-30-257950 Fax:030 26557000 Website: https://indianembassyberlin.gov.in/ E-mail: dcm.berlin@mea.gov.in
Germany Trade & Invest (GTAI)
Germany Trade & Invest (GTAI) is the economic development agency of the Federal Republic of Germany. Address: Friedrichstr. 60 10117 Berlin Telephone: +49 30 200 099 150 Contact: Achim Hartig Managing Director, Investor Consulting E-mail:achim.hartig@gtai.com Website: www.gtai.de
Frankfurt Economic Development GmbH
Frankfurt Economic Development is the first point of contact for Frankfurt’s businesses, founders and companies planning to set up in the city, irrespective of their size. Address: Hanauer Landstrasse 126-128 60314 Frankfurt am Main Telephone: +49 69 212-38548 Contact: Polly Yu Project Director, Competence Center Asia E-mail: polly.yu@frankfurt-business.net
FrankfurtRheinMain GmbH
FrankfurtRheinMain GmbH is the International Marketing of the Region, a company comprised of districts, towns and cities in the FrankfurtRheinMain region. Its task is to present and actively market the numerous strengths of our region. Address: Unterschweinsstiege 8 Main Airport Center 60549 Frankfurt Telephone: +49 69 6860 38 68 Contact: Sibylle Yaakov Vice-President, Head of Global Marketing E-mail: sibylle.yaakov@frm-united.com
Hamburg Invest
Hamburg Invest is the one-stop agency for relocation and investment in Hamburg as well as the main partner of Hamburg’s business sector on all topics relating to business development. Address: Wexstraße 7 20355 Hamburg Telephone: +49 40 22 70 19 – 475 Contact: Lee Lee Ong Project Director, International Investments (South East Asia/South Asia) E-mail: leelee.ong@hamburg-invest.com
Saxony Economic Development Corp. Wirtschaftsförderung Sachsen GmbH (WFS)
The Saxony Economic Development Corporation (WFS – Wirtschaftsförderung Sachsen GmbH) promotes Saxony as a business location and advises potential investors comprehensively from the initial idea all the way to the implementation of their relocation projects. Address: Bertolt-Brecht-Allee 22 01309 Dresden Telephone: +49 351 2138 211 Contact: Andreas Lippert Vice-President, Inward Investment E-mail: andreas.lippert@wfs.saxony.de
Sources: https://indianembassyberlin.gov.in/
https://exportpotential.intracen.org/#/products/gap-chart?fromMarker=i&exporter=699&toMarker=j&market=276
https://www.enterprisesg.gov.sg/overseas-markets/europe/germany/market-profile
https://commerce-app.gov.in/eidb/iecnttopn.asp
Stay ahead in the dynamic world of trade and commerce with India Business & Trade's weekly newsletter.