The latest addition to the list of foreign banks wishing to set foot in India is the Royal Bank of Scotland, which has total assets of over $806 billion.
The sudden interest in India follows the Reserve Bank of India's roadmap for according foreign banks greater freedom in India.
Switzerland's UBS, ranked the world's best private bank by EuroMoney magazine, has been preparing itself for India launch. Merrill Lynch and Goldman Sachs too are believed to be showing interest.
It is not known whether they will go alone or partner with an Indian entity in the new venture. Some of the new players are targeting the derivatives market to grow in India. The huge retail space is also an enticing factor.
Merrill Lynch has a joint venture in Indian investment banking space -- DSP Merrill Lynch. Goldman Sachs holds stakes in Kotak Mahindra arms.
US-based GE Capital last week announced its intention to set up a bank last week soon after the banking sector roadmap was unveiled. It already has wide presence in consumer finance through GE Capital India.
The RBI roadmap said the removal of limitations on the operations of wholly-owned subsidiaries of foreign banks and treating them on a par with domestic banks to the extent appropriate will be designed and implemented after reviewing the experience till April 2009.
A total of 33 foreign banks are present in India and had total assets of Rs 1,36,315 crore (Rs 1363.15 billion) as at end-March 2004. Roughly they account for about 7 per cent of the total banking space.
The list of foreign players includes banks like Citibank, Bank of America, Bank of Nova Scotia, ABN-AMRO Bank, Deutsche Bank and JPMorgan Chase Bank, which figure in the top 25 global banks ranked by The Banker magazine.
The other top banks like Credit Suisse Group, Industrial and Commercial Bank of China, are still to start banking business in India.
India is expected to find a place in the strategy of these banks given the country's growth prospects. There have been cases of foreign banks closing shops in India too. Dresdner Bank and Commerzbank fall in this category.
India's GDP is seen growing at a robust pace of around 7 per cent over the next few years, throwing up opportunities for the banking sector to profit from.
The credit of banks in India has risen by over 25 per cent in 2004-05 and the growth momentum is expected to continue over the next few years.
Participation in the growth curve of the Indian economy in the next four years will provide foreign banks a launch pad for greater business expansion when they get more freedom after April 2009.
