Business in Maple land
Canada, the "Gateway to North America," is a country with bountiful economic and business prospects for Indian investors and entrepreneurs...

With an economy almost twice the size of India, a vibrant Canada has developed in tandem with its neighbour the United States, both economically and technologically. The economy of this G8 nation recorded a spectacular growth in its manufacturing, mining and service sectors. In 2004, the UN ranked Canada as the world's 4th best country to live in. With a huge promise of business and trade, Canada beckons...

From physical beauty to world class-cities, Canada is globally acclaimed for its outstanding quality of life and stable political environment. Due to these factors, Canada attracts immigrants from all over the world for business, tourism as well as for permanent citizenship.

Occupying the northern portion of North America and touching the Atlantic, Pacific and Arctic oceans, Canada is the world's second largest country. It has the longest coastline in the world and a total land area of 9,984,670 square km. The Rocky Mountains cover a major part of Western Canada. Population is concentrated in the cities and the southern region due to extreme winter in the north.

Although area covered by farmland is just 8%, they are highly productive. Canada is one of the leading producers of barley, wheat, meat and milk in world. It is also rich in natural resources such as oil and natural gas, copper, gold, iron-ore. Canada is a diverse nation and has a blend of French and British traditions.

English and French are the official languages. Vancouver and Halifax are major ports. Alberta is a major oil producer. Toronto is the financial centre and presents tremendous opportunity for diverse businesses. Other important economic centers are Ottawa, Montreal, Edmonton and Victoria. Increased trade relations between India and Canada has resulted in a big Indo-Canadian community, which is nearly one million. India is the second largest source of immigrants to Canada.

Canadian Prime Minister Paul Martin's visit to India in early 2005 was followed by a trade delegation led by Canadian International Trade Minister Jim Peterson as it is expected that bilateral trade between India and Canada would take a new shape and offer both the countries an increased share.

History
It is believed that thousands of years ago, aboriginal people crossed a land bridge between Siberia and Alaska into North America and settled in Canada. Europeans landed at the Canadian coast in 1497, following which the race for control began between Britain and France. France gained initially, but the British occupied eastern Canada in1867. Britain established the Dominion of Canada by passing the British North America Act.

Provinces of Quebec, Ontario, Nova Scotia and New Brunswick soon joined. Canada was recognised as an independent nation on December 11, 1931. Britain and France eventually worked together in the development and progress of its. Today, the French speaking Quebec displays the French legacy in various ways, not the least being a move towards being an independently governed state. Canada is a constitutional monarchy, and the British monarch is its head of state. Paul Martin of the Liberal Party has been the Prime Minister since 2003.

Economy and business competitiveness
Canada, a leading G-8 country, is one of the healthiest economies in the world. According to World Bank figures, its- GDP stood at US$980 billion in 2004. Real GDP growth is projected to grow by 3.0% in 2005-06 (OECD economic outlook). As of June 2005, inflation rate of the economy stood at 1.5%. Current unemployment rate is 6.7%. The 2005 IMD World Competitiveness Yearbook has ranked Canada at fifth globally for overall competitiveness. With an advanced communications infrastructure, it is a breeding ground for new technologies.

CANADA : ENTREPRENEUR FRIENDLY LAND

Canada is considered as a great place for entrepreneurs. According to KPMG G-7 Competitive Alternatives (2004 edition), Canada ranks as the least-cost country among 11 major economies. Further, Canada ranks first in terms of cost advantages in several manufacturing industries, particularly in R&D intensive sectors such as aerospace, electronics, and biotechnology.

Canada has an energetic and welcoming infrastructure and supports entrepreneurial activity explicitly. According to a World Bank report 'Doing Business in 2005', Canada ranks first among OECD and G-7 countries for the lowest numbers of procedures required to establish new businesses. It requires around three days to start a new business in Canada. Labour costs in Canada are also the lowest amongst G-7.

As Mike Lazaridis, President and Co-CEO, Research in Motion, provider of the successful Blackberry wireless platform, states in favour of Canadian business environment, "Canada offers a positive business environment for high technology firms, with exceptional research and educational institutions and a very attractive quality of life." Undoubtedly, a haven for entrepreneurs.

Total Foreign Direct Investment (FDI) into Canada has tripled since 1990. According to Statistics Canada, FDI has shown an ever-increasing trend reaching $302 billion in 2004. Most of the FDI is pumped into knowledge-based industries and high-tech manufacturing, such as electronics, communications and chemicals. United States is the largest provider of FDI - 65.1% in 2004. The two countries have the world's largest direct investment partnerships with bilateral FDI flow totaling $356.7 billion in 2004.

The rise of the services sector has transformed the structure of the Canadian economy. The economy is divided in two economic sectors, of which five comprise goods-producing industries and fifteen services-producing. While the goods-producing industries account for 33% of the economy, the services sector is much larger, generating around twothirds of gross domestic product.

Total exports of Canada during 2004 increased to $429.13 billion from $400.18 billion in 2003. Imports reached $363.06, with the balance of trade being $66.06 billion in the same year. Canada and the US have the world's largest trade partnership with the bilateral trade between the two economies amounting to $561.5 billion in 2004 (Statistics Canada). As per World Trade Atlas, Canada accounted for 19.5% of total US trade in 2004. Its other major trading partners are - Japan, UK, Netherlands, Germany, China and South Korea.

Key industries
Canadian aerospace industry is the fourth largest in the world, fuelled by innovation, productivity and highly skilled employees. The aerospace industry manufactures aircrafts, engines, structural components, satellites, flight simulators and electronic systems. Some companies that took off in Canada are now leading players in the world market; include Bombardier Aerospace, Pratt & Whitney Canada, CAE and Bell Helicopter Canada. The industry exports nearly 80% of its output.

As per Aerospace Industries Association of Canada (AIAC), gross sales were $21.7 billion in 2004, with exports reaching a record high of $18.3 billion 84% of total sales. Diamonds are a recent discovery that has added sparkle to the Canadian economy. First major discoveries were made in the Northwest territories in 1991, and Ekati the first diamond mine became operational in 1998. Statistics Canada states that Canada is now the world's 3rd largest diamond producing nation showing immense potential.

Agriculture and agri-food sector contributed to over 8% of Canadian GDP. Canadian agri-food exports amounted to $20.4 billion in 2004, with 61% destined for US markets. Biotechnology accounted for roughly 17 percent of all venture capital funding in the country.

Other main industries include processed and unprocessed minerals, food products, wood and paper products, transport equipment, chemicals, fish products and petroleum and natural gas. Main items of export are motor vehicles and parts, industrial machinery, aircraft, telecommunications equipment, chemicals, plastics, fertilizers, wood pulp, timber, crude petroleum, natural gas, electricity, and aluminum.

Indo-canada bilateral trade
The trade relations between India and Canada started on a positive note post 1947, with the aim of enhanced cooperation between Commonwealth nations. But India's nuclear tests at Pokhran hampered bilateral ties. Also, Canadian economy suffered greatly due to oil shocks in the 1970s. Today, India is the largest trading partner of Canada in the entire SAARC region, although the figures are not that impressive. In the year 2004, the total exports of Canada to India aggregated $656 million, about 0.2% to Canada's total exports.

In imports, apparels, organic chemicals and precious metals are the top imported items by Canada, whereas Canada's exports to India comprised paper, fertilizers and electrical machinery. The total Canadian investment in India accounts for just 1.3% of the total investment approvals for the period 1994-2002.

Export Development Canada (EDC), Canada's export credit agency, has provided more than $4 billion as financing and insurance assistance for Canadian goods and services sold in India, including a $250 million deal with Reliance Infocomm. EDC has identified telecom, power, advanced technology, machineries, agri-food, aerospace and infrastructure as sectors for trade opportunities.

Canada and India have together signed a Joint Declaration on Science and Technology (S&T) Cooperation in April 2005. On the occasion, the International Trade Minister Jim Peterson said, "Canada and India are both strongly committed to increasing their science and technology capacities. The two countries have established the Canada-India Business Council and the Indo-Canada Chamber of Commerce to promote commercial and economic relationships. In order to explore new opportunities for business, strategic alliances and venture capital, a Canada-India CEO roundtable is going to be held in Canada towards the end of 2005.

Companies like LEA Associates, a Canadian power consulting firm, already has several projects in India. As far as Indian investments in Canada are concerned, a large number of Indian companies are discovering that it pays to invest in Canada. Early movers to Canada include some big software giants like Tata Consultancy Services, Infosys and HCL Infosystems. Ranbaxy has expanded its operations in Canada in the area of biotechnology.

Besides, wood pulp and paper is also an area where India has made significant investments. Canadian Information, Technology and Communications (ICT) market offers a good scope for Indian software companies. Canada has given rise to global champions like Nortel, Research In Motion (creators of the BlackBerry technology), and Sierra Wireless.

TCS has recently entered into a high profile R&D partnership with Communications Research Centre for advanced telecom research. VSNL has already offered to acquire Teleglobe International Holdings of Canada in line with its vision "to become a leading global player in wholesale voice and bandwidth and enterprise data services," according to N. Srinath, Director, VSNL.

All said and done, India firms have a terrific opportunity for upgraded technologies, as well as for entering the Canadian market in specific areas. Canada is surely the gateway to North America, and Indian companies could not receive a more promising beckoning than this.