How is the Indian consumer banking market different from that across the world?

The Indian consumer banking market has been growing at 30 per cent year-on-year. Despite this, the credit to gross domestic product (GDP) is relatively lower compared with other geographies, where it is as high as 70 per cent. India can still grow 10 times.

The consumer finance market in India is at a jump-off point. The Indian market is very competitive because you have existing foreign banks, private banks, new foreign banks and public sector banks.

Everybody wants a share of this market. We have been in India for over 150 years. China is a significant market for us, but India is a critical market. India is the second most profitable market in the world. It contributes around 16 per cent to the bank's revenues.

Is your consumer banking business in India being restructured?

We are moving to a customer-led focus, where products are being designed keeping various customer segments in mind. From being a broad-based credit card provider, we have now become selective and are focusing on the middle and upper income groups.

The unsecured market has become commoditised, with too many players operating in that segment. The profitability in this business is under pressure. When too many players focus on the same business segment, there is a chance of a bubble, as was seen in Hong Kong, Korea and Taiwan. This business is not so attractive in the absence of any entry barriers. We will continue with the business, but will be selective.

Since 2004, we have increased our focus on small and medium enterprises (SMEs) and wealth management. These are expected to be the fastest-growing sectors in the next decade. We have a market share of about 5 per cent in the SME business. We work with the top 5 lakh SMEs in India.

The demographic changes in India are creating a demand for wealth management services. We have competitive advantage when it comes to products and services. Wealth management needs sophistication and we have it.

The proposed acquisition of Amex will give us increased footprint in the country and the acquisition of UTI Securities will give us distribution points to expand our wealth management business.

You had to call off the UBS deal for regulatory reasons. What's the status of your asset management business now?

We are awaiting regulatory clearances. The regulations differ in various geographies and I guess that helps in keeping you young. On the asset management business, we have called for fresh bids.

RBI has a branch licensing policy in place, whereby banks are being granted branch licences in rural centres. How does this fit in your business strategy?

We work closely with the governments in the countries that we operate, contributing to their development process. The rural banking business will be a combination of agriculture credit, microfinance and banking services. Indian agriculture, in many ways, replicates that of China.

The main issue is the absence of cold chain. But we are taking combinations from other markets and exploring ways of working with corporates to put that piece in place.

The British trade and investment minister called RBI a protectionist, citing its refusal to clear Standard Chartered branch applications...

We have been in India and other markets for about 150 years. We have been applying for distribution networks across the world, understanding the regulations and accepting the regulatory restrictions. We are a long-term player.

Are you hopeful of the Indian banking sector liberalising in 2009?

In 2009, if the banking segment liberalises, we would be happy. But if it does not, will Standard Chartered be less happy? No. We believe that patience pays. For instance, we have been operating in China for 150 years. But it was only in 2004 that we got a licence to do local business. We are patient visionaries.