A new paradigm for India-Africa
The untapped bilateral trade potential between India and Africa is more than US$42 billion, according to a joint study by the Exim Bank of India and Afreximbank.
A multi-pronged strategy is needed to provide a more holistic and sustainable approach for tapping this untapped potential, said Commerce and Industry Minister Suresh Prabhu while highlighting the joint study.
Any strategy for enhancing bilateral trade between Africa-India will, therefore, critically hinge on the scope for value chain integrations in various manufacturing and services segments, he said during the interactive session on Indo-Africa Strategic Economic Co-operation in New Delhi on 6 Feb 2019.
The Commerce Minister expressed hope that a resurgent Africa and a rising India can create a new paradigm for South-South Cooperation.
He stressed on the need for right kind of investments in Africa, focusing on accessing the market coupled with the development of manufacturing capacities, seeking low-cost labour while focusing on human resource development and exploring the natural resources along with improving the infrastructural facilities.
Bilateral trade between Africa and India had increased to US$78 billion in 2014 and then moderated to US$60 billion 2017 reflecting a commodity price decline. In 2001, it was US$7 billion.
Prabhu said that the impressive growth in Africa-India trade stems from a mix of factors, including a growing stock of foreign direct investment undertaken by African and Indian corporate entities.
These factors also include the deepening economic and political ties illustrated by a number of strategic initiatives, particularly “Focus Africa” launched by the Indian Government in 2002 to boost trade and investment between Africa and India.
Other key drivers include the Government of India’s Duty-Free Tariff Preference Scheme for Least Developed Countries launched in 2008 which has benefitted 34 African countries, Prabhu pointed out.
Speaking on the occasion, Commerce Secretary, Dr. Anup Wadhawan said
African countries account for nearly 40% of operational Lines of Credit (LOC) extended by the Indian Government.
This increase in Indian development assistance is coming at a time when foreign aid of most developed countries has been registering a decline, he added. fiinews.com
