Survey calls for measures to double India-Africa trade
The buoyant trade between India and Africa, reckoned at US$ 25 billion in 2006-07, can be doubled to US$ 50 billion in five years if the Government zeros in on a 9-point package of measures, including setting up of an Africa Promotion Council, entering into preferential trade agreements, strengthening trade promotion cells in Indian missions and incentivising exports, particularly project exports, says a FICCI Industry Survey on ‘Strengthening Economic Engagement between India and Africa’.
The FICCI Survey saw the participation from 41 companies many of whom are actively engaged in business with Africa. The participating companies present the entire gamut of industries ranging from automobiles, food processing, ceramics, oil and gas, infrastructure, agri-bio products, farm equipment and machinery, sanitary-ware, electrical equipment and machinery, textiles, apparel and gems and jewellery. The turnover of the companies that participated in the survey ranges from Rs. 2 crore to Rs. 108,000 crore.
To put exports to Africa on a high trajectory, the survey asked the government to strengthen the trade promotion cells and economic sections in the High Commissions in different African countries and provide more, better and updated commercial intelligence.
India should look at entering into preferential trade arrangements with more and more African countries and regions particularly SADC, COMESA and ECOWAS.
India should further enhance the credit lines extended to African countries as this would only lead to more and more exports from the country.
There should be more and more interactions between the Indian and the African business communities. It is only through such meets and conclaves can the two sides explore and formulate policies to help increase trade. Companies have laid a lot of emphasis on having more sector specific business meets
Exports to Africa could be incentivised. Many respondents opined that a special package must be announced by the government to push Indian exports into the African market. Of particular importance here is the promotion of project exports, as these in turn will give boost to capital goods industry, consulting firms and companies providing technology support.
Some of the participants also mentioned that Indian companies should evaluate direct investment opportunities in the African market as well as start imparting training and education on the use and application of technical products such as agricultural machinery and farm implement. This they feel is bound to yield benefits in the long run in the form of greater exports.
It has also been suggested that an ‘Africa Promotion Council’ should be set in a PPP framework. Such a council should further have sub-councils focusing on each of the five regions in the African continent and be the focal point for facilitating industry forays and exports into that region.
FICCI and EXIM bank should organize seminars to make companies aware of the countries where loans on soft terms have not been utilized and what can be done to promote these countries.
Individual country reports should be prepared outlining the current requirements of each country and the future demand trends. Specific project studies should also be made as these can push Indian industry into Africa by making available all the requisite information at one point.