HSBC became another foreign bank who is closing down its private banking business in India Asia's third-largest economy because of low profit margins.

I have explain about low profit margins in India and how most business areas in India are just not profitable for foreign businesses.

In fact I have also explained in my book Doing Business in India and Understanding pitfalls that without proper understanding the Indian economy gold mine, rushing to the Indian market can be the prime reason for failure. Indian business ad market is just different.

"After a strategic review of the global private banking operations in India, we have decided to close the business," an HSBC Indian spokesman said.

Many foreign wealth managers opened business in India thinking of fast economic growth, only to find themselves confused with the low profit margins.

India's economy has failed to translate into profits for the foreign wealth managers.

Earlier Royal Bank of Scotland & Morgan Stanley have sold their onshore India private banking units.

HSBC would offer private banking clients the choice to move to HSBC Premier, the bank's global retail banking and wealth management platform.

HSBC employs around 32,000 people in India and it offers corporate, retail and investment banking services.

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