Foreign Investment

A Guide to India’s Business Culture and Etiquette

If you’re a foreign investor planning to invest in India, understanding the business culture and etiquette helps you navigate the Cultural Differences. Understanding the values, beliefs, and assumptions is essential for the success of a business. As business is a serious thing in India, it is important to have good business etiquette. In this blog, major aspects of India’s Business Culture and Etiquette have been discussed.

India’s Business Culture and Etiquette

For a foreign business to succeed in India, it has to be mindful of India’s culture, customs, and beliefs. Cultural adaptation and flexibility should be one of the important business strategies. Several cultural discrepancies arise, such as attitude towards the growth of the business, gift-giving customs, significance of things, and style of negotiation while doing business in India. This guide will be helpful in forming a business culture and etiquette strategy in India. Business Behaviours and methods, religious customs, and the importance of family are covered below:

Corporate Social Responsibility (CSR): India is the first country to make CSR mandatory as social and economic issues are very seriously taken in India. CSR involves businesses in national development agenda where businesses invest their profits in poverty, education, rural development, and infrastructure. As per the CSR rule, companies with a net profit of RS. 50 million or more during a fiscal year have to allocate 2% of their average net profit of three years towards CSR.

Importance to environmental issues: India’s business culture gives much importance to the environment. The Indian government has launched several projects for a clean environment, such as the National Mission for Clean Ganga (NMCG)¹. In addition to this, the Indian government provides various subsidies to users of renewable energies such as solar power and wind power. 

Punctuality: Punctuality is one of the essential aspects of doing business in India. If you have a meeting at 10 o’clock, your counterpart may arrive on time or maybe a little early. Being late for the meeting becomes very disrespectful. Further, in case of extended delay, you must request to postpone the meeting to a new time or day. While traveling in a metro-city, one has to be careful about road traffic as it takes much more than the expected time.

Giving Gifts: Giving gifts is a customary part of India’s Business Culture. It is a part of business etiquette. Once the relationship has been established, gifts may be exchanged. However, it is essential to ensure that the gifts are not expensive enough to be considered as a bride or inexpensive to be considered as an insult. Further, whenever you’re invited to a function or a social gathering, you must ensure that you carry a bouquet or some gift for them. The gift should be handed over either in both hands or in the right hand. When giving money as a gift, make sure it is odd in number, such as Rs. 21 or 51 instead of Rs. 20 or 50.

Business Dress Code: Even though you can wear modern formal such as formal shirts, suits, and trousers for work. Traditional clothing is also widely accepted in different parts of India, such as Shirts and trousers for men and a sari or kurta for women.

Cultural Differences: India is a land of culture. India’s Business Culture represents people’s ethics, morals, attitude, and values. Cultural ethics and value vary from place to place within India. 

Business Language and Communication: English is the official language of India and is widely spoken in business. Many Indians are fluent in English, while some do face difficulty in speaking English.

Role of Hierarchy in India: Indian businesses are very hierarchically structured. India’s business culture is such that the decision is generally taken by the highest levels. Unless the company director or senior management does not approve, no decision is likely to be taken.

Greetings and Introductions: As India is a multi-ethnic and multicultural society, one can follow a flexible approach to introductions and greetings. So you can either make a firm handshake or do a namaste.

Small Talk: It is a common habit to engage in small talk after greeting someone. Given the importance of family in India, it is a great way to ask some general questions about family. Remember not to ask too personal questions about family. Questions about family help build trust.

Wrap-Up: In summation, it can be said that India’s Business Culture is a multilingual, multi-ethnic, and pluralistic society. Cultural diversity is something that businesses must beware of. There are more formal and hierarchal relationships between employers and employees. Great value is placed on relationships in India’s Business Culture.

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Read Our Article: The Role of Culture in Business Entry Strategies in India

1. https://nmcg.nic.in/