How Indian companies can expand into Europe via Luxembourg

When Selvaraj Alagumalai first arrived in Luxembourg in 1988 for a one-year IT project, he did not imagine that this small European nation would become his home for over three decades. Nevertheless, in 1997, he became the first Indian entrepreneur to establish an IT company in Luxembourg. Today, as founder of Fouress Systems and IndoLux Hub, and recently appointed Honorary Consul of India to Luxembourg, he is uniquely positioned to guide Indian businesses seeking a foothold in Europe.

What made you establish your IT company in Luxembourg?

Selvaraj Alagumalai: When I came here for the first time, I simply fell in love with the country. I returned in 1992 to work in the banking sector and brought my family with me. Five years later, I started my own IT company, Fouress Systems. We serve retail and private banks, providing support services for their products. Now, most of the banks in Luxembourg know me. That is how relationships developed here — through trust and long-term commitment.

With the recent signature of the EU-India Free Trade Agreement, are you seeing increased interest in Luxembourg from Indian companies?

Absolutely. Since the finalisation of the EU-India Free Trade Agreement, I have received quite a lot of enquiries from Indian businesses asking how to explore the European market. As Honorary Consul of India, part of my role is to highlight what Luxembourg has to offer Indian companies.

There is also a growing number of Indians living in Luxembourg who create their own companies. Many, like me, have started to work here and want stay. So they develop their own businesses, and most of them are doing well.

Why is Luxembourg an ideal European base for Indian companies?

Luxembourg is obviously a small country, and people often ask me what opportunities they can find here. My answer is always: use Luxembourg as your European business hub and expand further from there.

Many companies might not find their main customer base directly in Luxembourg, but the location is excellent: you can reach a big part of the European continent with a few hours’ drive or a 1-1.5-hour flight. It is easy to move around. Luxembourg is a multilingual, multicultural environment, which makes it comfortable to work with different nationalities and cultures.

Luxembourg is a multilingual, multicultural environment, which makes it comfortable to work with different nationalities and cultures. The real advantage, however, is the support ecosystem.
Selvaraj Alagumalai, Honorary Consul of India to Luxembourg

The real advantage, however, is the support ecosystem. There is strong backing from the Luxembourg government and from organisations such as Luxinnovation, Luxembourg’s national innovation agency, and the Luxembourg House of Financial Technology (LHoFT). They all provide comprehensive support to new businesses setting up in Luxembourg. Companies can conduct their research and innovation here, secure intellectual property for their products and then expand their business across Europe. For Indian companies looking to explore Europe, Luxembourg offers the ideal starting point.

What challenges should Indian companies be aware of when setting up in Luxembourg?

Setting up a business in Luxembourg is straightforward, though opening a bank account can take time — that is something companies should prepare for. Other than that, I mainly see opportunities. Luxembourg can be a little slow in some ways, but things work out for the long term. After 30 years here, I understand how Luxembourg works. Patience and building relationships are key.

What advice would you give to Indian entrepreneurs considering Luxembourg?

I always try to pass on what I have learned to fellow entrepreneurs and anyone who asks for help. My advice is simple: Luxembourg rewards those who think long-term. Build relationships, leverage the innovation support available from organisations like Luxinnovation, and use Luxembourg as your gateway to the European market. The opportunities are there for those willing to invest the time.