Bank of Baroda, the fifth largest bank in India, today opened a representative office in the heart of Sydney's central business district, becoming only the second Indian bank to establish a presence in Australia.
State Bank of India, India's largest commercial bank, had opened a branch in Australia on April 21, 2004, becoming the first Indian bank to have a presence in this country.
Lighting the traditional lamp, Indian Minister of State for Finance Pawan Kumar Bansal said: "It is the banking sector which is the driving force for India's economic growth. The Bank of Baroda with 64 overseas branches has been ambitious to move out, compete and be an equal player in the world economy."
There are 19 Indian banks that have 188 branches abroad and 29 foreign banks have a presence in India through their 268 branches.
Emphasising the growing importance of Australia-India relations, the minister said: "We have to move from cricket to economy as Australia becomes an important bilateral trading partner. With many more Indian banks coming here and Australian banks going to India, together we can charter the path of common prosperity."
Bank of Baroda celebrates its centenary year in 2008 and Australia becomes the 22nd country across six continents where it has an office. It is hoping to soon open an office in New Zealand.
Welcoming the bank to "the hurly burly of Australian banking system", Australian Prudential Regulation Authority (APRA) Chairman John Laker said: "Their presence as a representative office is likely to be only a stepping stone to a full-fledged participation in the market here. If that was the case, the competition provided by another Indian bank here would be a positive benefit. The bank's initiative is further confirmation of the importance of the bilateral trade and economic relationship between the two countries."
Two-way trade between India and Australia totalled over A$10 billion in 2006, with India becoming Australia's 11th largest merchandise trading partner. Australia exported A$1,528 million worth of services to India in 2006.
According to the Federation of Indian Chambers of Commerce and Industry, Australia is India's eighth largest overseas investor with over A$1 billion approved for around 140 joint ventures.
According to Invest Australia, Indian investment in Australia is also worth around A$1 billion, making Australia the ninth most important destination for Indian foreign direct investment.
"Setting up the representative office is only a beginning and we are hoping to get a licence from APRA for a full-fledged branch in the future," said Bank of Baroda's Chairman and Managing Director Anil K Khandelwal.
Bank of Baroda has a network of over 2,800 branches and offices, and about 700 ATMs.
The growing expatriate Indian community in Australia has long felt the need for more Indian banks here because they find it difficult to send remittances back home.