Idaho finds opportunity in India

For a mere $15,000, Idaho has put its foot in the door of a market with such obvious potential it’s amazing hardly any other state has thought to do the same thing.

India, with its one billion-plus population, has just begun to emerge as one of the world’s economic giants. Gross domestic product is growing at a rate of 8 percent, with cities like Hyderabad and Bangalore becoming global high-technology centers. The country’s rapidly growing middle class is already buying automobiles and other goods once beyond reach. India may well eclipse the United States in economic output in another generation or so if its legendary bureaucracy does not get in the way.

Meanwhile, the U.S. and India did $26.8 billion worth of business with each other in 2005, with a regrettable imbalance of more than $10 billion in India’s favor.

President Bush visited India in March in a successful bid to improve an often strained relationship. Despite the trade imbalance, he said, Americans should welcome closer economic ties with India.

Idaho was already on the case, thanks to serendipity and hard work.

Roger Madsen, director of the Department of Commerce & Labor, met Nikhil Behl when the state was negotiating work force development funds for an HPshopping.com service center in Boise, which opened last year. He manages the Boise operation.

Behl is the son of Prem Behl, the owner of Exhibitions India, which conducts trade shows, among them India’s largest telecommunications conference. He represents trade organizations from Hong Kong and Israel. For that $15,000, Prem has agreed to do the same for Idaho. Madsen and John Sandy, top aide to Gov. Jim Risch, signed the deal on a visit earlier this month to India.

Madsen was in India last year speaking to an Indo-U.S. economic summit about emerging energy technology research in Idaho. In March, a trade delegation from India spent a week in Boise.

“There seems to be a real desire to build up a relationship,” says department spokesman Bob Fick, adding “India is a market we really cannot afford not to cash in on.”

Although Idaho exports to India are negligible, about $9.5 million last year, the potential is significant for state semiconductor and construction companies.

Fick notes India lacks the infrastructure it will need to become an economic power.

“The field would be wide open for a company like Washington Group International,” he says.

Idaho has been increasingly alert to overseas business opportunities.

The Legislature this year doubled to $600,000 the budget supporting state international trade activity. Between $50,000 and $75,000 will finance additional trade missions; most of the rest will fund overseas trade offices and representatives like Behl. Idaho has trade operations in China, Japan, Taiwan, South Korea and Mexico.

Fick says representatives from California, in Boise for a recent conference on work force training, were so impressed with Idaho’s network they asked for more information. California, with one of the largest economies in the world, let alone the U.S., has no overseas trade offices.

“I was stunned,” Fick says.

Washington has some catching up to do as well, at least as far as India. The state most dependent upon trade has seven trade offices in six countries but nothing in India. Although state governors have made several trade missions to Asia in recent years — Gov. Chris Gregoire heads for South Korea and Taiwan next month — none has touched base with India.

Last year, India was Washington’s 19th largest export market. State companies sold $424 million in goods and services, with Boeing Co. aircraft representing by far the bulk of those deals. Fruit, surprisingly, was second, with exports of $23.4 million.

Mark Calhoon, managing director of international trade in the Department of Community, Trade and Economic Development, says a trade mission had tentatively been scheduled for next fall, but the latest word is the trip will likely not happen. He notes the Trade Development Alliance of Greater Seattle plans a trip to Mumbai, Bangalore and New Delhi later this year.

“It’s definitely on our radar screen,” Calhoon says. “There are great opportunities there.”

Yes, and so far it’s been Idaho that has shown the hustle to take advantage. Good for Boise.