Gov. Martin O’Malley is keen to take the relationship between Maryland and India “to the next level,” said Akhilesh Mahurkar, a director of one of India’s largest business organizations.
“He came across as someone who could take decisions and walk the walk,” said Mahurkar, based on his interaction with O’Malley during Maryland’s November trade mission to India that included about 100 higher education, state and local government and business officials.
Many of the agreements have not yet been executed. For example, following the trade mission, the Federation of Indian Chambers of Commerce and Industry, of which Mahurkar is a member, announced that it will create an India-Maryland center in the state, but the location has not yet been chosen.
Although many details are yet to be determined, three Maryland business leaders who entered into agreements with Indian companies discussed the challenges and opportunities ahead, shedding light on about 10 contracts that were signed by Maryland companies worth a combined value of nearly $60 million.
“I think that the challenges that exist are ones of habit and custom,” said Maryland House Majority Leader Kumar Barve of Montgomery County, one of three Indian-American members of the House of Delegates to participate in the trade mission.
Despite the cultural differences, the business leaders said meeting their Indian counterparts in person helped close the deals that their companies had been previously negotiating.
“Being with the governor and with a trade mission kind of said this is not a fly-by-night company,” said Karl Gumtow, CEO of Baltimore-based cybersecurity company CyberPoint International.
Like many of the other agreements, CyberPoint’s was predicated on the benefits of bringing Indian technology to the United States.
The company signed a $10 million contract with New Delhi-based Appin Security Group to jointly develop security solutions for mobile phones.
The goal of the agreement is to “integrate our two concepts together in a single solution,” said Gumtow. Appin is already selling the product in India and Gumtow said he hopes to launch the product in the United States this summer.
Mukesh Kumar, managing partner of Germantown-based Amarex Clinical Research and a native of New Delhi, said he “doesn’t see many business challenges that you wouldn’t see with businesses here in the USA.”
Amarex and Bangalore-based biotechnology company Scalene Cybernetics Limited agreed to a deal worth between $20 and $50 million based on the achievement of milestones.
Kumar said he hopes to obtain Food and Drug Administration approval of Cytotron, Scalene Cybernetic’s non-invasive cancer and arthritis fighting medical device, by 2014. The product is already sold in Europe.
“The biggest challenge is that the [two countries’] business culture and the regulatory structure are very different,” Kumar said.
He said Amarex’s experience developing original products and dealing with the FDA makes the deal beneficial for both sides. Indian companies are unaware of the risks and time span involved in developing original products, Kumar said.
The Indian pharmaceutical industry is dominated by generic pharmaceutical companies that reproduce medicines developed by other firms and sell them at low cost, Kumar said. If the partnership is successful, Cytotron will be one of the first medical products developed in India and approved for sale in the United States.
The contract between Amarex and Scalene Cybernetics will create regulatory affairs and marketing jobs in Maryland and high-end manufacturing jobs in India, Kumar said.
Amarex has helped other foreign companies navigate the U.S. regulatory system. During a Montgomery County trade mission to South Korea in 2008, Amarex agreed to assist Chungbuk Province to bring its companies’ products to the market, Kumar said.
CyberPoint has a division devoted to helping foreign companies sell their products in the United States because strict regulations make the American market a difficult one to penetrate, says the company website.
Robert Nathan, CEO of Washington-based DataNet Systems Corporation stressed the synergism of his company’s agreement with Hyderabad-based companies Health Management Research Institute and RT MediBus. While the Indian companies have “perfected” medical call center technology, “they know the cultural deficiencies of call centers in India,” Nathan said, referring to difficulties Americans have in understanding the Indian accent.
DataNet is planning on opening a medical call center in Prince George’s County that uses the Indian partners’ technology. It will most likely be located in Upper Marlboro or Cheverly, Nathan said. He is going to India next week to discuss details with the partner companies.
The November 2011 trade mission trip cost the state government $135,000, said Karen Hood, a spokeswoman for the Maryland Department of Business and Economic Development. The figure does not include the expenses of county officials or public university officials. Elected state government officials and business leaders covered their expenses out of pocket, Hood said.
Signe Pringle, a member of the Governor’s International Advisory Council, said that it is premature to judge the success or failure of the numerous contracts that were signed.
Ranjana Khanna, secretary general of the Federation of Indian Chambers of Commerce and Industry, said the mission was successful. As proof, she pointed to the upcoming Indian trade mission to Maryland scheduled for the end of April.
About 30 Indian representatives are expected from the medical, technology and clean energy industries.
Maryland has a trade office in Gurgaon, India, near the capital city of New Delhi. According to the governor’s office, in the first nine months of 2011 there were $341 million in imports and exports to India through the Port of Baltimore, an increase of almost 50 percent from 2010.
The trade mission was Gumtow’s first visit to India. He said that there are many business opportunities involving the sale of Indian technology and products overseas.
He was struck, he said, by the extreme wealth and poverty coexisting side by side, and said he tells people that he “saw some high-highs and some low-lows.”