At this point, RPC operated five factories in Australia and Southeast Asia, designing and delivering composite components – including the likes of train fronts and interiors – for passenger rail projects. In Australia, RPC is a key supplier to the passenger rail Industry for projects such as Vlocity, Xtapolis, Next Generation Trams (NGT) in Victoria and the Perth and Sydney metros.
Meanwhile, its customer was expanding its operations in India, building rolling stock to support the transformation of local and global rail systems. It sought RPC’s capabilities, which were unmatched in India. However, under the government’s ‘Made in India’ policy, a local manufacturing presence was required to bid for Indian rail projects.
De-risking RPC’s market entry
RPC’s Managing Director, Tony Caristo, says that RPC initially weighed the merits of setting up in India without existing contracts and explored options to de-risk its entry. Rather than invest upfront in building and setting up its own plant, RPC took a phased expansion approach.
The first step was partnering with a local composite manufacturer. Tony says this involved “bringing RPC’s supervision and technical expertise into their factory and servicing our existing customer”, as well as setting up an entity in India (RPC India) to bid for local opportunities. Alongside its customer, RPC India submitted winning bids on three contracts, including for India’s mass and regional rapid transport systems.
As contract works began, the partnership increased its manufacturing capacity and RPC hired local staff. At that time, Tony says that RPC’s approach was to “set up the partnership, learn how to operate in India, and once we had more confidence, decide what our next steps would be.”
Tony says, “Our local partner helped RPC set up, open bank accounts, introduce us to the right people and understand local government requirements, like having clear signage for visiting officials. We also engaged advisory firms to assist our local staff with our company secretarial and mandatory needs and had the support of auditors and accountants.”
After five years, RPC considered a joint venture partnership with its local partner; however, the complexities of decision-making meant that it did not proceed. In the absence of an alternative option, RPC is establishing a standalone operation under RPC India.
“We’re about to sign a lease and aiming to have our plant running within six to eight months to support new projects we’re bidding on right now,” Tony says. “That’s the journey we’ve been on—get familiar, get confidence, and now go it alone.”
Building market knowledge and confidence
As RPC expanded in India and navigated the local market and regulatory settings, how it worked had to change. Tony says important lessons along the way helped RPC adapt its operations.
For Tony, one learning was that financial regulations could be more restrictive than in other locations like Singapore and Australia. For example, all money moving in and out of India goes through the Bank of India, requiring precise documentation to avoid processing delays.
“We were importing product from Europe but paying suppliers through our company. Instead, we realised monies should go directly to the person importing it into India which would have made payments faster and easier,” Tony says.
RPC has been a CommBank client for ten years, using bank guarantees and lending facilities to support RPC’s activities in Australia. Tony says that RPC was able to leverage “a lot of good contacts and support” through CommBank’s Australian team. CommBank facilitated introductions to government and banking contacts, with RPC still using that network today. This included the local Australian embassy, the Department of Foreign Affairs and Trade and Indian banks, among others.
Another key factor for RPC is recognising the cultural differences when doing business in India. For example, RPC received initial, surprising feedback from its local partner that it was too contractually focused which may be hindering negotiations.
This highlighted that a mutual appreciation of business culture helps underpin good partnerships and find common ground. For Tony, “finding partners that also understand the Western way of doing things is as important.”
Part of a growing, global manufacturing centre
While RPC supplies to multiple sectors, including defence and infrastructure, servicing passenger rail manufacturing projects in, and from, India presents a significant strategic opportunity for the business.
According to Tony, RPC is now in discussions with a range of global train manufacturers building the next generation of stock for Indian railways. He says that the size and market opportunity in India is multiples of Australia.
“To put it into perspective, an Australian project might be an eight-year program for 240 cars, where we see single Indian projects for over a thousand cars in three years.” He adds that the market is highly competitive, and India offers distinct advantages such as cost efficiencies for labour.
That’s a key reason why RPC is focused on building its manufacturing footprint in India over the next five years. Tony says that these attributes are crucial to success for RPC and any businesses entering or expanding into India.
“To grow in India, you need at least three things—perseverance, patience and partnerships. Each will help you learn how to operate and maintain commitment over the long term because it won’t happen overnight,” Tony concluded.
