New horizons of opportunity between India and Singapore

Separated by the vast Indian Ocean, but bound by shared culture and history, Singapore and India enjoy a close relationship. Ties between the two have only deepened in recent years, with an appreciation of economic complementarities and shared strategic interests. 

The two economies have long enjoyed a strong trading partnership, and in recent years, stronger government-to-government collaboration has helped strengthen ties between the business communities and resulted in record flows of capital. 

India-Singapore economic ties were in the spotlight at DBS Bank’s inaugural India-Singapore Business Gateway forum, held on 21 November 2025, which featured insights from the bank’s business leaders, senior DBS economists, government agencies such the Singapore Business Federation and Enterprise Singapore, as well as DBS’ ecosystem partners and clients. 

In keeping with the theme for the forum—Unlocking Two-Way Opportunities—the discussions were focused on the deepening economic and strategic relationship between India and Singapore, resulting opportunities for Small and Medium enterprises (SMEs) on both sides, and guidance on how to navigate the complexities of doing businesses in new markets for first-time entrants.

An established familiarity

Singapore is India’s largest source of foreign direct investment (FDI). Over the past 25 years, it has invested US$175 billion in India, accounting for almost a quarter of all FDI inflows¹.  As of 2025, one of Singapore’s two sovereign wealth funds, Temasek, has committed to invest up to USD10 billion in India in the near term, building atop its already-significant USD40 billion portfolio, emphasising its long-term perspective on the market². 

Trade ties between the two countries also remain strong. Singapore accounted for 27.8% of India’s trade with ASEAN in 2024-25. Hundreds of SMEs in both economies trade extensively with one another, and this includes chemicals, computers and other electronics, machinery, plastics, transport equipment and pharmaceuticals, among others.

Singapore-India ties have strengthened over the years, and are set to deepen further with the Comprehensive Strategic Partnership between the two countries. Key areas of collaboration include digital, healthcare, sustainability and connectivity.

Opportunities in India

Among the key discussion points at the event were the prospects resulting from India’s changing regulatory landscape and macroeconomic developments. 

Over the next 15 years, its economy is set to grow at an average 6.7%, outpacing growth in China and the ASEAN-6, placing the country on track to become an US$11 trillion economy—the third largest in the world—by 2040³.  

Another factor behind India’s growth prospects is its demographic dividend—a labour market that is younger and more educated than in regional peers, noted Radhika Rao, a senior economist at DBS. 

Accompanying the sound macro fundamentals and the favourable demographics is the government’s strong push for manufacturing. A string of reforms, laws, policies and initiatives have been undertaken to encourage both domestic and foreign companies to boost manufacturing activity in India, panelists said.

For these reasons, India continues to receive FDI inflows. India received US$81.04 billion in FDI inflows in FY2024-2025, a 14 percent increase over the previous year⁴.  A key development in this space is the emergence of Gujarat International Finance Tec-City (GIFT City), a special economic zone and the country’s first international financial services centre, which is expected to serve as a key node for channelling FDI from MNCs and foreign entities into India. 

Next stage of growth

Between now and 2040, DBS sees India supplementing its growth agenda through a four “D” framework: development, diversification, digitalisation and decarbonisation. 

From investments in infrastructure to support economic development, to the rapid pace of digitalisation cutting across multiple sectors, there are strong growth areas for Singaporean SMEs to tap on. 

India is also looking to diversify its manufacturing sector towards high-value, innovation-led production and the increased use of automation and robotics. Semiconductors have emerged as a key priority for India, for instance. In 2025, the country approved 10 semiconductor projects totalling US$18.2 billion in investments to accelerate its nascent chip-making industry⁵.  

The sector is set to benefit from an existing pool of Indian engineering talent, as well as the support of the Singapore’s developed semiconductor ecosystem, forum participants said. In 2024, both countries signed an MoU that would supply Indian firms with access to Singaporean technology and supply chains, while a 2025 MoU established a skills centre for advanced manufacturing in the southern city of Chennai⁶.  The two partners are also working on a “green lane” to streamline semiconductor trade.

Navigating India with DBS 

The myriad opportunities aside, forum participants also spoke to the various challenges of doing business in India—from dealing with different bureaucratic norms and structures, to understanding the regulatory landscape, and appreciating local nuances. 

With its strong roots and its wide network in India, DBS is well-placed to play a supporting role, helping facilitate two-way investment and trade.

Since making its foray into India in 1994, DBS India has evolved into a mainstay in the market. It is the first foreign bank to operate as a wholly-owned locally-incorporated subsidiary, which enables it to provide holistic coverage to corporates across the country—from large multinationals to SMEs. It is also the first foreign bank in the country to get government agency business, which means that its customers can make GST payments through the bank, making it easier to conduct business. 

Additionally, DBS offers liquidity management, trade and supply chain finance, treasury solutions, factoring and cross-border onboarding services, all of which are critical to SMEs. 

While India is not an easy market to navigate for new entrants,  the right partners can provide the right kind of support. DBS brings to the table its global expertise and a vast network that have empowered Singaporean businesses to make the most of the opportunities in this rapidly expanding market. 

[1] High Commission of India in Singapore
[2] https://www.temasek.com.sg/en/news-and-resources/stories/future/temasek-is-stepping-up-the-pace-to-grow-its-us-40-billion-india-
[3] https://www.dbs.com.sg/wrapperapi/generic/download-pdf?pdf_path=content/article/pdf/AIO/102025/251030_insights_india.pdf
[4] https://www.pib.gov.in/PressReleasePage.aspx?PRID=2131716
[5] https://www.cnbc.com/2025/09/23/india-is-betting-18-billion-to-build-a-chip-powerhouse-heres-what-it-means.html 
[6] https://www.straitstimes.com/asia/south-asia/singaporean-firms-see-growing-opportunities-in-indias-chips-sector