India-Finland Business Forum
November 7, 2002, New Delhi

Keynote Address by Hon'ble Mr. Jari Vilén, Minister for Foreign Trade of Finland
 

Your Excellencies, Ladies and Gentlemen, Distinguished Guests,
 
I feel very honoured in having this opportunity to address such an esteemed audience of representatives of government, local authorities and the business community as today. After I took office as the minister responsible for foreign trade in the beginning of this year, I have travelled widely. However, this is my first opportunity to visit South Asia.  I am particularly glad to visit India, a rising global actor, a cradle of religions, a treasure house of cultures traditional and modern, and for us Finns also a country regarded as mystic and adventurous, thanks to our respected Marshal Mannerheim, once President of our Republic. Mannerheim writes in his memoirs about how in the ´20s and ´30s he experienced  quote the land of dreams and wisdom, with its tigers, elephants, temples and flowers unquote.

Obviously, I am not here to hunt tigers like our Marshall did. Today your country appeals as one of the fastest-growing economies in the world and as the world's second largest consumer base. India offers numerous avenues for establishing and further strengthening important business linkages.

Ladies & Gentlemen,

First of all, I would like to thank the Honorable Minister of State for Commerce and Industry, Mr. R. P. Rudy, for hosting my visit with the business delegation. I also want to thank Mr. R.S. Lodha, President of FICCI, for arranging this Finnish-Indian Business Forum in such an outstanding manner with Finpro.

Finnish-Indian relations started to develop after diplomatic relations were established in 1949 and the first resident Finnish Ambassador was appointed to New Delhi in the same year.  The Olympic games of 1952 were especially memorable for both of our countries as they were held in Helsinki, and India won her first Olympic gold medal there.

Economic relations between Finland and India started to develop more rapidly in the 1990s. In fact, during that decade Finnish exports to India grew almost threefold. Also India increased her sales to Finland by a third. There are today almost 30 Finnish companies established and operating in India. The most common set-up is either in the form of an industrial joint venture or a local branch or representative office. More than 70 additional Finnish companies are represented and actively exporting to India by utilizing the services of their appointed local agents, representatives or importers.

Trade between Finland and India has traditionally been in favour of Finland, as the only country of the European Union with such a positive trade balance with India. Trade figures have varied but show an overall trend of steady growth. In 2001 our total trade was USD 271 million, Finnish exports representing USD 194 million and Indian exports USD 77 million.

The main Finnish export items were heavy machinery, ICT-related goods plus products of the wood and paper industry.  India, for her part, exported machinery and equipment, chemicals, jewellery and also textiles. The Indian software business has also succeeded in having a fairly good foothold in the Finnish market.

Interesting new business potential for Finnish products and services in the Indian markets exist for instance in wireless mobile communication, energy and power, environmental technology, biotechnology, and health care.

I am happy to say that when we informed the Finnish business community of this forthcoming visit, the interest was keen. Our business delegation consists of all the major sectors of economic activity with top companies, from industrial giants to small and medium enterprises.

Distinguished Guests,
 
We have followed with great interest the modernisation and the opening up of the Indian economy. However, further steps in the economic reform would enable our two countries to fully utilize the potential for their mutual trade and economic cooperation on a level playing ground.  During this visit we will take up technical issues affecting market access for our businesses.

We are convinced that this scenario for the future gives ample opportunities for both Finnish and Indian companies to deepen their co-operation, with benefits to be shared by the two nations.

Ladies and Gentlemen,

Finland is nowadays best known for her information and telecommunication technologies. Quite often I have been asked how has a remote, small nation with cold, long winters and a curious language been able to achieve such tremendous success? Let me explain very briefly how this happened.
 
Finland has always been an export-oriented economy. At the moment, more than 40 per cent of our GDP comes from exports. Our industrialization started 150 years ago and was based on our most important raw material which is timber. On the basis of timber and some mineral resources we gradually built a prosperous economy based on modern industries, which also enabled us finance a welfare state.  None of this would have been possible without a democratic society. One of the most important resources has been the human capital with 1) a full literacy since 150 years, and 2) full participation of women in the economy and in the political life. Ours is a country of engineers who represent the largest group among university graduates.

Wood-based products and engineering products were the mainstay of our economy until the 1980s,  but a dramatic change has taken place since.  The government took a deliberate decision to turn the country into a high-tech society ready to tackle the challenges of the information age. In the 80’s Finland’s input into research and development was one per cent of GDP, only a third of the figure that USA and Japan had.
 
Today Finland's input in research and development is 3.7 per cent of GDP, second only to Sweden. Out of this, one fifth is financed by the government and the rest by the private sector. We are a world leader in electronic banking. In addition, we now have connected all of Finland´s schools to the Internet.
 
This year, Finland has been ranked by the World Economic Forum as the most competitive economy in the world, and by UNDP´s Human Development Report, as the technologically most advanced country in the world, and also the country with the highest marks in environmental quality. A survey carried out by the UN Conference on Trade and Development (UNCTAD) ranked Finland number six as an investment target among the industrialised countries. A recent survey by Transparency International named Finland as the least corrupt country in the world for the third consecutive year.

Finland's population is only 0.1 per cent of the world's population. Our share of the world's GDP and industrial production is four times that, and our share of the world´s exports seven times. But our share of world's exports of paper industry is 12-13 per cent, and sales of mobile phones 35-40 per cent. In exports of hi-tech, covering also biotechnology, we are among the strong countries. The share of the IT sector in our trade with Asia was last year about a half, for both imports and exports.

The Finnish education system is responsive to the needs of industry and the extent and level of cooperation between research institutions and industry are among the best in the world. Co-operation in research and development is an important part of the business operations of Finnish companies abroad. Finland is an internationally popular choice for post-graduate studies and many companies train their staff in Finland.

We have also reached a high level in health-related know-how. Finnish health care equipment and medical instruments are rapidly conquering new markets. The basis for this success is the massive investment the Finnish government and local governments in Finland have made in the public health system. We also have a thriving private health sector.

We are aware of environmental problems and have developed related science and technology to cope with the challenges. Many visitors to Finland marvel at the seemingly endless forests they see all over. In fact, two thirds of our land area is covered by forests. Scientific management and the highest technology allow us to run our wood-based industries at full capacity and yet maintain this record rate of forest cover. Our wood biomass does not diminish. Nor are our thousands of lakes and rivers suffering of pollution in spite of nearby wood and pulp mills.

Finland has also developed new and interesting solutions in the energy sector required by our cold climate, our energy-intensive production structure and the shortage of indigenous energy sources.

We are part of the euro zone and the internal market of European Union where goods and services move from one country to another without any barriers.

As a northern country Finland can serve as a practical gateway to our neighbouring areas: the Baltic countries and Russia. We have a long experience in dealing with our neighbours. Finland can offer services for companies planning to enter such new markets.

Finland looks forward to both strengthening and broadening her commercial and economic ties with India. This includes investment. Indeed, during this visit we will sign an agreement on the protection and promotion of investments. We hope that it will encourage our investors by giving a higher level of security to their investments in both countries. This coming Monday the 13th Meeting of the Finnish-Indian Joint Commission will take place in New Delhi, and in that meeting our mutual interests in economic cooperation, trade, technology and cultural exchanges will be dealt with in detail.

I trust that during this Finnish-Indian Business Forum new ideas will be presented and many useful new business contacts established for the benefit of both sides.

Thank you for your attention.