Australian company takes a down-to-earth view of India's future

March 2016

Download the PDF version (506 KB)

A Brisbane-based geospatial technology company is helping India plan its future growth.

Geospatial information identifies where natural, built or cultural objects are located relative to the Earth. In today’s interconnected world, combining location with other data helps governments to clarify economic, environmental and social issues such as infrastructure development and conservation, and respond to natural hazards like floods.

AAM Pty Limited specialises in collecting, analysing and delivering geospatial information. Founded in 1959, the firm now has almost 500 professionals and custom aircraft at work in Australia, New Zealand, the Middle East, South East Asia and Africa.

AAM uses airborne laser scanning and high-resolution imagery to analyse everything from expanses of landscape to individual pieces of machinery. It works across mining, oil and gas, infrastructure, utilities, government, forestry, environment, finance and insurance industries.

This expertise is of significant value to India, which continues to grapple with issues such as economic growth, conflicting land use, resource management and infrastructure planning.

AAM is investing $10 million in India over the next three years via a joint venture with Hyderabad-based Skye IT Solutions.

Skye IT Solutions contributes local knowledge and understanding of how to win and undertake geospatial projects in India. By working in a joint venture, AAM India will bring a new level of geographic information system services to South Asia.

Government legislation previously limited the collection of geospatial data within India. Those restrictions were recently lifted, leaving India with the local capacity to process geospatial data, but few resources to design, acquire or tailor the data to meet its requirements.

Over the past decade, AAM has regularly visited India for projects and conferences. While knowing that it wanted a permanent presence in India, timing was vital to deciding when the market had developed to the point where a local presence would enable AAM to capture a larger share of the emerging geospatial market.

David Jonas, AAM Business Development Manager for Asia, says it was during a conference in Hyderabad in January 2014 that the balance tipped from ‘potential’ to ‘happening’ in the local geospatial market, giving AAM the confidence to take the plunge.

‘We wanted a permanent presence in India and considered all possible models,’ Jonas says.

‘With a major presence in South East Asia and having been active in the Indian market for a decade, the AAM brand was well known and trusted in India, and this supported starting our own office.

‘However, we wanted the new venture to be an Indian company, not an Australian company working in India. Launching on our own would have cost more and taken much longer.’

Selecting an existing local partner also gave AAM established infrastructure, legal representation, contacts and business registrations for an immediate start, as well as an existing workflow to help fund the new operation.

‘AAM India is now a self-sufficient entity in the AAM Group,’ says Jonas.

‘It’s managed day-to-day by experienced Indian professionals, and it’s strategic direction is set by combining our Indian colleagues’ local market and business insight with Australians’ global market and technical expertise.’

AAM says the essential ingredients for doing business in India are patience and flexibility. Jonas says this favours Australian firms, which often find themselves competing against other international companies that can’t or won’t make the necessary commitment.

‘Government has a larger influence in India than Australia, and dealing with both elected and administrative forms is essential,’ Jonas says.

‘This shouldn’t bother too many Aussie firms because we’re used to dealing with three levels of government.

‘You need to know your way through the labyrinth of government administration. Local assistance helps to identify the relevant players and advise on how to arrange the appropriate interactions at each stage.

‘For example, we were part of the Austrade delegation in Hyderabad led by Parliamentary Secretary Steve Ciobo in June 2015. We worked closely with Austrade on that ministerial trade visit and it opened doors for us.’

Government projects in India come from open tenders, invited tenders, panelled suppliers or direct award. Because officials may not be familiar with your proposed solutions, Jonas says it is important to explain how your methods will meet their objectives without any risk or adverse consequences to other components of the project or stakeholders.

‘You can’t expect government officials to understand the full nuances and implications of one solution over another,’ says Jonas. ‘They need to be comfortable that you are selling them a viable solution, and that your evidence is based on documentation.

‘Ultimately, however, it falls to trust. Personal relationships set the platform of trust on which the usual commercial documentation of case studies, capability statements and CVs can sit.

‘Aspirational exporters need to be aware that unscrupulous vendors have gone before them to foist expensive, unsuitable or unviable solutions onto government officials.

‘Failed projects reflect poorly on the individuals involved so they’re wary about exposing their department to risk.

‘Your value proposition needs to concentrate on relevance, benefits and certainty, and less on features, technology and trying to impress with irrelevant details.’

Qualification for government tenders is usually defined in the tender documents. Many require a level of Indian content. AAM has won two sizeable government projects by partnering with local companies.

In both tenders, AAM’s solution was the lowest price – not due to cost cutting, but by understanding the project and designing an optimum solution to meet its requirements.

‘As aerial survey is an immature market in India, we’re seeing a wide range of tendered pricing,’ says Jonas.

‘Some are clearly below cost, either due to companies desperately wanting to enter the market or underestimating the challenges of working in India. Other prices are way too high, likely due to international partners including a large risk factor for venturing into the unknown.

‘AAM plans to win projects at the right price by balancing two principles – understanding the market to apply appropriate risk pricing, and understanding the technology to apply cost-effective solutions.’

Although India is renowned as a price-conscious market, Jonas highlights that isn’t the full story.

‘Indian business people respect quality and certainty,’ he says.

‘They want to work with people they can trust to protect their investment and guarantee their project’s success.’

Produced by the Australian Trade and Investment Commission (Austrade). You may reproduce the text without prior permission, though attribution of the source is appreciated. Please note that copyright restrictions do apply to all photographic images and permission must be obtained before reproduction.

For further information, success stories and news visit: www.austrade.gov.au/news or contact the Austrade Corporate Communications Unit Media-Helpline@austrade.gov.au.