International Trade Committee on Feb. 25th, 2013

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

Madame Papillon, go ahead for five minutes.

[Annick Papillon, NDP, Québec, QC]

Thank you, Mr. Chair.

Despite the extraordinary opportunities in India, the reality is that the vast majority of Canadian businesses are small and medium enterprises. You spoke about that, Mr. Sood. You said that trade services for SMEs needed to be improved because they do not always have the resources they need to make the most of the contracts. Because of their size and their more limited resources, entering a market like India's can be intimidating, even costly.

How can we help SMEs find a niche in the Indian market? Could you please give us more detail about the trade services you told us about earlier?

[Predeep Sood]

As I said, the trade services we have are phenomenal. They are very helpful; they are world class. We have a pretty good presence in India. More is always better and welcome, but we have a fairly good.... All sectors are represented there too; there are no complaints, no problems....

I'll just throw out an idea. The trade services are serving the large and small companies in the same way. Small companies require hand-holding and more time to get to the same end. They need more communication because they can't afford to fly to India every other day. So maybe it is time to look at having an SME-focused trade commission service, whether here or in India, or wherever. But maybe that's what the small and medium-sized enterprises need, because it serves two purposes. That's the area where we've been most successful in. After CEPA and FIPA, probably we'll get into bigger things but that's where we've been most successful. Why not get more SMEs in and why not help more business in that area, which is not regulated? It will help that way.

Secondly, deals eventually happen because of interdependence. I think the more we get into India and the more Indians come here, the more we will have some kind of a relationship building, which will take us very far. That is just a suggestion, and I feel that it's probably one way of doing it.

The other success I can tell you about, in which the federal government is also involved, is with the Ontario Chamber of Commerce. It manages the export market access fund, or EMA fund, which the federal government has given some money to. That fund gives up to $30,000 to any company that qualifies, and they have to spend an equal amount of money to explore a market or to do a show in a new market, and things like that.

The exports under that program were $130 million, and so far the chamber has spent about $13 million. The return is 20 times the investment. If there were a way that we could have more small and medium-sized enterprises access funds like that and directly tabulate how they were performing—because they are supposed to submit their export documents for us to keep track of—I think those kinds of things would help the SMEs enter the market a little more carefully and easily.

[Annick Papillon, NDP, Québec, QC]

Thank you.

[The Chair, Conservative, Rob Merrifield]

Mr. Morin, you have one minute.

[Marc-André Morin, NDP, Laurentides—Labelle, QC]

Mr. McRonald, you are proposing some changes to the Indian dairy industry. Do you think there could be a way of integrating these changes in the actual structure of the Indian dairy industry, or do you think they would have to change the size of their farms or the number of dairy farmers?

[Rick McRonald]

Over time the number of farms will decrease. For any country that has a developed dairy industry, including our own, as the number of farms goes down, the number of animals per farm goes up. Overall, nonetheless, the number of animals goes down, which benefits the environment. As India develops, that's going to happen, no question. It has to happen. But it's not going to happen as fast as we'd like to see. We're going to have to move at the pace that India is comfortable moving.

[The Chair, Conservative, Rob Merrifield]

Thank you very much. Time is short, I know.

Mr. Shory, you're going to try it in a Canadian accent this time. Go ahead.

[Some hon. members]

Oh, oh!

[Devinder Shory, Conservative, Calgary Northeast, AB]

There you go, Mr. Chair. Thank you for your kindness, but my accent will not change.

[Some hon. members]

Oh, oh!

[Devinder Shory, Conservative, Calgary Northeast, AB]

Anyway, I believe that Mr. Madan and Mr. Sood missed making a response to one of my questions. We have more than a million Indo-Canadians living here in Canada. My question is what role can the Indo-Canadian community play in identifying and maximizing market opportunities that could result from an eventual CEPA agreement?

Mr. Sood, you commented on quality being compromised in India when talking about competition with China, etc. We have heard in the committee that there are 25 million people living in India who have the capacity to buy virtually everything and anything. I believe those 25 million, or a majority of them, would not care about the cost or the price, but they would look at quality. So perhaps you can address that as well.

[Pradeep Sood]

On your second question, I totally agree with you. As I told you, Indian innovation is not about sacrificing quality, but giving the right product at the lower price. That's the innovation model of India. So quality, I totally agree with you, is always there. It must always be kept in mind, whether it's for those 25 million people, or whomever, and whether it is for road building or whatever. Quality is a given, and it should be kept that way.

On the question of the diaspora, today, as a live example, you heard Suresh tell you what TiE is doing in building entrepreneurs and financing innovations, and the connectivity that his organization has. I don't think they have been tapped to the maximum potential. I can name other similar organizations.

But there's one thing missing in international trade. We used to have, I don't know how many years back, a meeting every three months, I think, in Ottawa, called Focus India to my knowledge. All the organization heads were invited to that meeting. Some used to participate by phone, some used to come from across the country. At those meetings, we used to exchange ideas with each other and everybody would go up and have two minutes to tell everyone else what their organization was doing. We came to know what was happening and what we could tap into and make connections. It was not purely based on Indo-Canadians but all organizations headed by whoever it might be, but focused on India. So that meeting was totally for India.

I would request that the committee please consider reintroducing that because it was a great meeting. In Ottawa, in a two or three hour long meeting, we used to learn so much about India, what was happening, where it was happening, and who was doing what. That way there was no duplication. If the diaspora were there, they'd know what was happening and then they'd know which role they could play, because the whole diaspora cannot play this role. There are a few organizations that can, but not all of the million Indo Canadians. Certainly, we need that connectivity and ability to learn about India right here rather than going over there and learning. It can certainly be tapped into here.

[Devinder Shory, Conservative, Calgary Northeast, AB]

Thank you, Mr. Sood. Thank you for cutting out our trip to India.

[Voices]

Oh, oh!

[Devinder Shory, Conservative, Calgary Northeast, AB]

Mr. Madan, you wanted to make a comment.

[Suresh Madan]

Yes, Mr. Shory, I fully agree that the Indo-Canadian community has a much greater responsibility to bridge the trade and our relationship with India. To that effect, the Indus Entrepreneurs organization has three chapters in Canada, whereby we are connecting over 400 different entrepreneurs with 16 chapters in India, where we have about 3,000 entrepreneurs who are members of these chapters. We routinely provide introductions, mentor each other, and provide a forum to discuss our business ideas and how we can benefit from each other's technologies and markets, and from opportunities with each other.

We also organize an annual conference in the Silicon Valley. Entrepreneurs from Canada and from India meet and share and exchange ideas. In fact, subsequent to these conferences, we have had many trips from Indian entrepreneurs who come here to explore opportunities. Similarly, Canadian entrepreneurs have gone to India and have explored opportunities.

We recognize that to do business in India you need to have joint ventures and partnerships. The best way to enter into these partnerships is to meet like-minded people and have an exchange of ideas, and to meet them over a number of months before you get into bed with them. We are encouraging and promoting that.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

Ms. St-Denis, you have the floor.

[Lise St-Denis, Liberal, Saint-Maurice—Champlain, QC]

I would like to ask a question about youth.

In your country, there is a growing number of people pursuing university studies. Your population is growing at an incredible rate. Young people today must be quite different from those of previous generations.

What is the attitude of young people toward trade projects with other countries? Do they see it as an opportunity to immigrate more easily or is it the opposite, and they deny the situation and withdraw inward?

I saw a documentary that showed just how many problems youth in China have. It said that industrial growth in China was not fast enough for the number of young people looking for work or going to university.

Are you facing the same problem? With respect to exchanges with other countries, do young people have any specific or different attitude, or do they simply let the central government impose its decision on them?

[Suresh Madan]

A huge priority for India, as well as Canada, is opportunities for youth. It's important, especially when the job environment and job opportunities in many larger companies, as well as in governments and government agencies, are declining.

The opportunities for youth will come through youth starting out on their own. That gives a special impetus to the need to promote entrepreneurship: educating youth on how to start their own business ideas, how to be productive in their society, and how to be employers rather than employees. It means educating, networking, mentoring, harnessing these ideas, and providing them initial microfinancing and seed money so their ideas see the light of day and they ultimately incorporate.

In Canada, especially in Toronto, I think we have built a system whereby we've been able to do quite well in encouraging youth to think as job creators rather than job seekers. That opportunity can be available to youth in India, who will be way more interested, both in starting a business for the Indian market and in starting a business for a global market, whether it is done by being there or by immigrating.

[Predeep Sood]

On the question of attitude, it's like any youth. Yes, in watching television and in doing a lot of other things of the western world, their attitude is also changing, but being educated and being productive is still the cornerstone for Indian youth. Education remains a very high priority in India. When you see students coming overseas, it's very often because they cannot get admission to the university of their choice in India, even if they have marks of 95%. There are a lot of students who have marks of over 90% to 95%, but they cannot get admission.

So as for movement, all the youth from India I think would come to Canada. They would all come here. They love to move. I don't think Indian youth have that problem. They are fairly versatile. I can't talk for everybody, but they would like to go out and study, to go out and learn. That's very traditional in India. It's something that is looked at as a very positive thing for anybody in India, wherever they may be, so I would say that it's unlike China, and Indian youth I think are different.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

Now we'll move to Mr. Shipley, who will be the last.

[Bev Shipley, Conservative, Lambton—Kent—Middlesex, ON]

I just have a couple of quick ones before we wrap up.

To Mr. McRonald, you talked about there being, I think, three artificial insemination units in India at this time that have been set up in partnership. We understand that it's by partnership that they have to work. Did you use the trade commissioner services at all when you went in?

[Rick McRonald]

Yes. What I said was that three members of CLGA have partnerships in India.

When we talk about the diaspora, I mentioned in my opening comments that the three big artificial insemination companies had members of the Indian diaspora as employees and they were thoroughly frustrated. But when things began to change in India and the demand was there, they've since led the way, and it's through the Indian Canadians that they've made these arrangements and actually gone in and set up partnerships with existing artificial insemination companies in India.

Yes, they do use the trade commissioner service, as the association does, and we get excellent service.

And I should say that these companies, all of the CLGA members, are SMEs by definition. So the services they have received and continue to receive through the trade commissioner service are excellent.

[Bev Shipley, Conservative, Lambton—Kent—Middlesex, ON]

I just have two quick follow-up questions. You mentioned there really was no benchmark in terms of genetic evaluation being used or set up in India. You also mentioned that they wanted to preserve some select breeds some times. First, are there enough of those select breeds to justify the cost that would be involved in developing that genetic pool?

Second, what is the quality of animal they're looking for? Are they looking for the frozen semen or the embryos that are of commercial value, or are they actually looking to spend money on higher-end genetics that we would be able to benchmark and then provide that type of service evaluation and market to them?