The Finnish Begin

After East Asia and America, Northwest Europe is blooming to become the next
big destination for the Indian ICT industry. Finland, most famous for being
Nokia's cradle, has, in the last decade, seen rapid economic growth. Though
forests are still Finland's most crucial resource, the engineering and high
technology industries led by Nokia have long been the leading lights of its
success story.

There has now begun a major drive to offer Indian companies a great deal of
opportunity for locating there. Invest in Finland is a national organization
based in Helsinki, promoting FDI in Finland. Funded by the ministry of trade and
technology, it offers Indian ICT companies assistance to come and set up shop,
primarily to do research. According to Taneli Saari, director, location
services, Invest in Finland, "Finland is the hub of ICT research in
Europe." Though this agency offers helpful information on business
environment and investment conditions, and selecting the best business partners
and locations, Saari says, "We are not saying just give us your money. We
are saying give us your ideas, and we will help you turn them into success
stories."

Finland is an excellent Northern European center in terms of access to
growing markets, excellence in technological know-how and top-level business
environment. Maximum potential for expansion and growth of trade and investment
lies in areas like software, security, telecommunications, mobile and wireless
solutions and biotechnology. Finland's most important export market is
Germany, followed by UK, USA, Sweden and Russia.

As per the World Economic Forum's Global Competitiveness Report, 2004
Finland ranks first in growth competitiveness and is ranked second in business
competitiveness after the USA. Said to be a relatively easy market to enter,
foreign companies are welcome and treated on an equal footing with Finnish
companies. The rapid company registration process and R&D funding make
Finland a worthwhile investment.According to Vesa Kaasalainen, director, Tampere
International Business Office, "To come and start operations in Finland one
does not need any local partners or a license-just come and start
operations."

Finland has a multi-lingual workforce with English in wide use. The current
29% corporate tax too is being brought down to 26% in 2005. Coupled with the
sophisticated infrastructure and competitive operating costs as compared to
other European countries, the Finnish government offers an attractive business
environment. These initiatives are supported by the Finnish government's
technology-based economic policy to increase R&D expenditure by Euro 235 mn,
i.e. 5% annually, on average.

The real goldmine here lies for the SMEs, who can obtain special development
aid for improving their competitiveness. They are entitled to tax relief on
fixed assets in certain development regions. Also, the National Technology
Agency of Finland (Tekes) provides them grants for research and development that
lead to internationally competitive products, processes and services. "Last
year the Finnish government gave away Euro 330 mn in investment grants to such
companies", informed Saari.

Indian companies like Blue Star Infotech, Tata group, Wipro and Zensar
Technologies are already cashing in on first mover advantages. Expanding further
on its strategy of offering global execution model, Wipro established a
development center in Tampere, Finland, in 2003.

With near-shoring being the need of the hour, the Indian industry only stands
to gain from accepting the warm welcom extended it to capture bigger projects
serving an European clientele

Jasmine Kaur with inputs from
Ibrahim Ahmad