Introduction: The Brazilian Corporate Landscape
Advantages of working in Brazil
Time zones of North America and Brazil are same, thus helps
in better coordination among the global employees
Growing domestic market
Rapid pace with which IT industry in Brazil is increasing
Massive economic power lies in Brazil, being the 10th
largest economy and also 5th largest country in the world
Brazilians Prefer soft-spoken clients, rather than aggressive
clients to work with
They generally are more comfortable if one knows their
language more clearly. They are not so good at English, thus becomes a cherry
on the top of pie, if any client knows their own native language i.e.
Businesses in Brazil are built and developed based on the
relationships. They give a lot of value to personal connections and contacts
For businesses, its cost is relatively higher but has its own
perks if done correctly
While visiting Brazilian homes, taking a present or flowers
is its tradition. But one thing to be kept in mind is that the gift or flowers
shouldn’t be of black or purple colour as they are used during funerals
During business meetings, exchange of business cards are
necessary for introducing one another. Also having a Portuguese translation of
the business card is highly appreciated
They don’t like the Indian way of negotiating prices
Prefer to develop relations and follow the policy of give
respect and take respect
Boss of the company is give utmost respect and the decisions
of boss are final
Brazilians are particular about their dress code.
Executive-level people generally wear 3-piece suit
In Brazil, its common to hire a middleman in business called
No stress on punctuality, for meetings they usually arrive
In Brazil, Deadlines are not followed strictly and
flexibility is considered in positive sense
JOGO DE CINTURA: Last minute planning, here employees are not
keen on long term planning, they believe in short term planning specifically
today and tomorrow
They appreciate good eye contact and backslapping is very
common among Brazilians
In case of disinterest, they show it by clapping using the
back of one hand and the other hand’s palm
O.K. – using this in Brazil is considered rude way of talking
Greetings and Conversation Etiquettes
Common form of saying hello- “como vai”, “tudo bem”, etc.
When meeting for the first time, it is customary to say “Muito Prazer” meaning
When addressing a person, it is considered appropriate to
address that person with his/her surname or title
Gossips they prefer: Football (they love conversing about
football), songs & music, relationships, etc.
They generally don’t like to talk about politics or religion,
they consider Argentina as their enemy
Backslapping, handshakes, hugging are common form of
Work place & Hierarchy at work
General working hours at
Brazilian offices are from 8:30 till 5 in the evening. For business meetings,
it is required to appoint or schedule the meeting 2-3 weeks before the meeting
and also their meeting are not too formal. They love to socialise and spend
much time understanding each other and building up relations and connections
are a very important aspect for businesses.
Also, the hierarchy in
Brazil is not horizontal, rather it is vertical where the decisions taken by
the head of the office are final.
India Brazil Relations
connection between India and Brazil is five-century old. Historical ties
between both countries can be traced back to the Asian migration to South
America that led to the evolution of the indigenous people of Americas. Between
the 16th -18th centuries, Brazil and Goa, both under Portuguese imperialist
outreach, had bilateral exchanges, which reflected in the flora and fauna, food
and dress as well as folk traditions of Brazil. India’s contribution to farming
in Brazil is significant, the bulk of Brazilian cattle livestock is of Indian
origin. Brazil still imports a major portion of fresh embryos from India to
rejuvenate its cattle breed. Indian embassy opened in Rio de Janeiro on May 3,
1948, which later moved to Brasilia on August 1, 1971. The Brazilian Embassy
has in India has been functional since 1949 and has a Consulate General in
Indian Community in Brazil
The Indian community NRIs
in Brazil is small, numbering about 2000 persons. Many of them live in Sao
Paulo, Rio de Janeiro and Manuas. The community mainly comprises of
professionals and businessmen and some researchers in agriculture, physics,
a bilateral agreement, diplomatic and official passport holders are exempted
from visa for a stay of maximum of 90 days. There are no direct flights between
India and Brazil. Favourable connections are however available via Europe (London,
Frankfurt, Paris, Amsterdam), the US (New York and Chicago) and via Dubai.
is huge Brazilian interest in Indian culture, religion, performing arts and
philosophy. The first forms of Indian Culture to reach Brazil were related to
spirituality, philosophy and religion. Both Brazil and India are cultures in
which people are colourful and noisy. Folkloric celebrations from India find
affinity towards the jolly and colorful nature of the festivities such as the
typical dances and parades of north and northeast of Brazil.
In classical music,
Brazil’s share of classical music goes beyond Sitar, Tabla and other
instruments to create fusion music in collaboration with Brazilian artistes.
There are numerous organizations teaching Yoga, all over Brazil, namely,
Ramakrishna Mission, ISKCON to name a few.
The connection between the cultures can be observed in social
media as well. In 2002 after Google purchased Orkut to compete with Myspace and
Facebook, the site lost its appeal in almost every country except India and
Brazil which generated most of Orkut’s revenue.
Indian cinema is popular among Brazilian people. A
commemorative stamp was issued by the Brazilian Post in May 2014 on “100 years
of Indian Cinema”. Several Brazilian actresses and models have also worked in
Bollywood. Caminhos das India (paths of India), an Indian themed Brazilian soap
opera filmed in Agra and Jodhpur, is a Brazilian Indian love story, and is
extremely popular in Brazil. It is being re-telecast on the popular Brazilian
India- Brazil Bilateral Two-way Investments
Investments have been
happening both ways between India and Brazil. While Brazilian companies have
invested in areas such as automobiles, IT, mining, energy, biofuels, footwear
sectors in India, the Indian companies have focused in sectors such as IT,
Pharmaceutical, Energy, agri-business, mining, engineering/auto sectors. Major
Indian companies in Brazil are such as TCS, Wipro, Infosys, Cadilla, Mahindra,
L, Renuka Sugars, United Phosphorus, and Polaris. The major Brazilian
player operating in India are Marco Polo (automobiles), Vale (biggest mining
company), Stefanini (IT), Gerdau (Steel).
Figures – 2016 (USD in Billion)
Growth % of Export
Growth % of Import
Brazil’s trade with
Brazil’s total global
India-Brazil trade remained low in 2016. However, this must be seen in
the context of overall decline in Brazil’s global trade which was down to even
less than year 2008 levels when it was USD 370 billion- the period when
Brazil’s trade started to rapidly increase. Brazil’s total trade even attained
a high of USD 481 billion in 2013, at the height of Brazil’s growth but the
recent years’ sharp economic and political turmoil has greatly affected the
country’s overall growth and trade. Consequently, sharp declines in import of
diesel from India and the world in general, is the main reason for the current
low trade figures. Despite this, India sustained its position among the top
trade partners of Brazil and slipped only one spot to 11th position. With an
economic recovery expected in 2017, trade may begin to pick up in the coming
Brazil and India signed an
agreement in 2003 for defence cooperation which was ratified by Brazil in 2006.
The agreement calls for cooperation in defence related matters, especially in
the field of Research and Development, acquisition and logistic support between
the two countries. Defence Wing was established in the Embassy of India,
Brasilia on 24 December 2007 and Brazil opened its Defence Wing in the Embassy
of Brazil, New Delhi on 14 April 2009.
About 55 Brazilians went to India
under ITEC programme to get trained in communications, management, defence etc.
in the last eight years. ITEC courses are gaining popularity amongst
Brazilians, and many students have enrolled for the current session.
Indian Pharmaceutical Industry in Brazil
Before 1999, not one
Indian pharmaceutical firm had established operations in Latin America.
Pre?1999, Indian firms without a local base worked through traders and
distributors to bring their products, which were predominantly APIs or other
pharmaceutical inputs, to the market. In the pre?1999 period, Indian APIs
accounted for an almost insignificant proportion of imports in this category,
ranging around 2.5 per cent of total imports. The rapid entry – via Greenfield
investments, joint?ventures, acquisitions or licensing agreements – of 11
Indian pharmaceutical firms in Brazil post 1999, provides a valuable example of
emerging patterns in FDI from India to Brazil.
The entry of Indian
pharmaceutical firms in the Brazil pharmaceutical market can best be understood
through analysis of some important characteristics:
First, in terms of
location, Indian investment in the Latin American region is overwhelmingly
concentrated in the Brazilian market. With over half of all Indian
pharmaceutical companies in Latin America located in Brazil, and Brazil serving
as the first stop for companies establishing operations in the region, Brazil
became the headquarters of Indian pharmaceutical activity in the region.
The second major common
characteristic of Indian FDI in the Brazilian pharmaceutical market is the mode
of entry used by firms. Indian pharmaceutical companies expanding in the region
chose to do so predominantly through Greenfield investments, as opposed to
acquisition, licensing, mergers or joint ventures. Reticence to acquire in the
region may reflect a dearth of significant trade history through which to
establish potential partners, combined by significant geographical distance,
which increases the complexity of principal agent problems for Indian firms in
Establishment of Generics
The most important
catalyst for Indian investment and activity in Brazil, however, was the
establishment of a generics category in 1999.In the year before the law was
passed, no Indian firm had local activities in the region. In the year
following the generics law, five Indian companies established subsidiaries in
Brazil, all pursuing market?seeking strategies. The creation of the generics
category opened doors for Indian firms with a historical strength in
manufacturing generic finished formulations.
India exports bulk drugs
(pharmaceutical raw materials known as API) to Latin America. These companies
in Latin America manufacture Pharmacy products. Bulk drugs exports are over
$300 million worth. This helps Latin American manufacturers reduce their cost
of production, thanks to the low-cost inputs from India. Apart from this, Indian
pharmaceuticals are never a competition or threat to the Latin American
industry, which has been hurt badly by the large-scale entry of Chinese
manufactured products in many sectors.
The success that Brazilian
generics companies have enjoyed has been shared by Indian companies which are
both competitors and suppliers to Brazilian generics companies. Indian firms
competed with national firms for the newly formed generics market. At the same
time, they became key suppliers of APIs for local generic producers,
integrating themselves into both the final step of the supply chain and
becoming suppliers to their competitors.
New directions in Indian strategy: from
generics to similares
Two major differences
distinguish the regulation of generic and branded generics products in
Brazil. Generics labelling is distinct; packaging must prominently display a
“G” and the name of the active ingredient, while similares may be labelled
with a commercial name. In terms of distribution, generics products are offered
to customers by a pharmacist. Similares, by contrast, are prescribed by a
doctor using the product’s commercial name.
Many Indian EMNCs first
focused on registering products in the generics category,
avoiding similares and trusting that competitively priced goods could
win over locally produced generics. Other firms pursued pure similares
strategies, avoiding generics. A third group focused on APIs.
The firm Glenmark, for
example, markets APIs, generics and similares, but most of its revenue is
generated through sales in APIs. Although Ranbaxy recently moved into
the similares segment and is also present across all segments, it
derives most revenues from generics. Only two firms, Cellofarm and Torrent,
achieved similares?based business models.
A pure Similares model:
In 1999, Torrent entered
Brazil focusing exclusively on the similares segment and targeting
Brazilian doctors and the wider public:
In building a brand,
Torrent targeted the medical community. It established a lecture series,
“Corações e Mentes”, or “Hearts and Minds,” in cities across the country. In
addition, it minimized its offering of products, registering primarily in
cardiovascular and central nervous system segments and only introducing
products not offered by Brazilian competitors.
As a result of its public
relations, focus on the medical community and
pure similares strategy, the Brazilian market provided Torrent a
significant portion of its foreign generated revenue during the mid?2000’s.
By 2017, it is the largest Indian generics player, with revenue growing
by 25 per cent in April-December to INR 484 Cr.
Sector in Brazil
India & Brazil have
started investing in one another’s countries. Over the years they have
developed synergy in their businesses. Brazil exports crude oil, agricultural
products such as coffee, sugar, etc. to India whereas Indians have started
joint ventures in the field of IT sector in Brazil. Many Multi-National
companies such as Wipro, Infosys, and TCS have started capturing the market of
TCS: One of the India’s largest IT Company, has started joint
ventures in Brazil. Initially TCS established a development centre in Tambore,
in Sao Paulo and slowly entered into the service industry by focussing on cloud
computing, mobile internet, big data, ERP systems, IT sourcing etc. In 2002,
TCS started a joint venture with 51%-49% venture through group TBA.
Infosys: Infosys also started focussing on doing business in Brazil,
by starting with the establishment of development centre in Nova Lima in 2009,
similar to other IT firms started joint ventures and acquisitions to establish
IT business in Brazil. In 2012, Infosys acquired Lodestone, speciality in SAP
system. Gradually it started giving IT services in Brazil focussing on ERP
systems, BPO, SAP based consultancy, etc.
Wipro: Wipro started to do business in Brazil since 2007 by
providing IT services similar to other Multi-national IT firms such as Big
Data, Oracle, SAP, Analytics, cloud computing, etc.
Like other IT firms it
also started acquisitions in Brazil such as acquiring the company Enable- a
retail consulting firm.
Tech Mahindra: Tech Mahindra also started acquisitions by acquiring
51% share in IT Complex, a Brazilian SAP consulting company in 2013. This
acquisition was mainly for enhancing the service portfolio in Brazil focussing
majorly on BPO & Cloud computing. Partner with “Equinix” for sharing data
centre platforms & also for entering and expanding its business in Brazil.
Similarly many IT firms
started eyeing on Brazil for providing a portfolio of IT services. Recently it
signed an agreement with IBM for cloud based application and many other joint
ventures and acquisitions started soaring up. Brazil is among the top 10
countries which are acing in IT growth. Currently Brazil is the 7th largest in
IT Sector market across the world beating India in 8th position. In America
too, the market of IT sector contributed by Brazil is around 49%, thus
dominating the market. The current rate of growth of IT sector in Brazil is
around 6.7% and rate of investment growth is 4.04%. Its market cap is around