Pawlenty plans trade mission to India

In a quest to expand Minnesota trade with one of the world's hottest economies, Gov. Tim Pawlenty announced plans Tuesday to lead a trade mission to India in October.

Pawlenty described India as a nation with a middle class about the size of the entire U.S. population, yet state officials say it lags at 22nd place among Minnesota export markets.

Pawlenty, his wife and about 30 business leaders will travel to New Delhi, Bangalore and Mumbai.

"Strong economic growth is unleashing a wave of demand in India," Pawlenty said in a prepared statement. "From consumer goods to professional services, high-tech to health care, machinery to processed foods, the prospects are abundant."

Many Minnesota companies already do business in India and are looking to do more.

"My expectations in India are that [our business there] will grow probably 2 to 3 times over the next five to 10 years," said Bill Simser, Asia business development director for Imation Corp., based in Oakdale. "It's certainly worth tens of millions [of dollars] to Imation over time."

Imation, a data storage company with $1.58 billion in sales, has done business in India for decades through its Singapore office. Last year, it created an Indian subsidiary, which now has eight employees and several sales offices in India.

Scotch tape maker 3M Co. already has 700 workers and three tape and abrasives plants in Bangalore, Pondicherry, and Ahmedabad, India. On Tuesday, CEO George Buckley announced that 3M is building one more, in western India.

Golden Valley-based Pentair Inc., which has 400 workers, 500,000 square feet of factory and its Global Center for Design and Research in India, is another likely candidate for the trip. "India is an essential piece of our Asia-Pacific strategy," Pentair spokeswoman Rachael Jarosh said. India has mandated that all commercial buildings set up rain collection systems, and Pentair has won filtration contracts there as a result.

Triple-booked

Indian companies are equally eager to do business with American firms, said Prakash Puram, CEO of Bloomington-based software firm IXMatch.

"The world looks to America for creativity, innovation and brand names," said Puram, an Indian immigrant who sits on the U.S. Department of Commerce Export Council. Puram traveled to India in December as part of a U.S. trade delegation to meet with the companies that provide IT support and customer service to dozens of big U.S. concerns.

"Three of us went from my company and we were, at times, triple-booked," Puram said.

Minnesota Trade Office chief Tony Lorusso is leaving this week for India to arrange meetings and exhibitions for what will be several dozen Minnesota companies in October.

"India needs to invest in roads, telecommunications, energy systems and distribution," Lorusso said. "We want Minnesota on the cusp of delivering those products and services."

India has been trying for years to shake the reputation of a bureaucratic, red-tape-bound country that has tremendous physical and human resources but still struggles to deliver crops to market and feed its children.

Part of the attraction for Minnesota companies is India's burgeoning middle class, which now numbers 250 million to 300 million, according to Robin Elsham, managing director of India BPO Consulting, a research and consulting firm in Mendota Heights. "And if you look at the spending on health care in India, underway or planned for the next decade, there is tremendous investment," Elsham said.

That combination of forces led Starkey Laboratories, the hearing-aid manufacturer based in Eden Prairie, to open its first factory in India in April. Starkey has had a distributor in India since 1998.

That factory, in New Delhi, will help the company meet local demand for sales and treatments, said Philip Lyons, director of international sales and marketing. The factory opened with 70 employees.

"It's a country growing out of its skin every 10 minutes," Lyons said. "It's just an unbelievable market for us."

Companies such as Medtronic already sell millions of dollars worth of medical products annually to India. Golden Valley-based Alquest Inc. does clinical trials in India for medical device companies.

Growing concern

The India initiative coincides with growing concern over India's role in "outsourcing" by American companies. India's large number of English speakers has made it a favorite for call centers and telecommunications jobs.

A bill aimed at requiring operators at foreign call centers to disclose their location if requested, and to provide a U.S. number if personal or financial information is sought, has been introduced in the Minnesota Legislature.

Pawlenty said he shares those concerns but suggested that such a law might send the wrong signal.

"We have to be careful about making Minnesota insular," Pawlenty said. "When you're a small place, you don't want to close doors."

The mission will be Pawlenty's fourth big business trip. He went to China in 2005, Poland and the Czech Republic in 2004 and Canada in 2003.

Minnesota companies interested in participating must apply by May 31. Applications are available online at www.export minnesota.com.

Star Tribune staff writers Dee DePass, H.J. Cummins, Janet Moore and Neal St. Anthony contributed to this report. Dane Smith • 651-292-0164 • rdsmith@startribune.com