FOCUS AFRICA

WHY AFRICA
 RAPID ECONOMIC GROWTH
 IMF RAISED ITS GROWTH FORECASTS FOR

AFRICA
 POLITICAL STABILITY
 RISING MIDDLE CLASS
 ABUNDANT NATURAL RESOURCES
 VAST BUSINESS OPPORTUNITIES
GEOGRAPHY
 DEMOGRPAHICS

Total population: 0.819 billion

Population growth: 2.5%
Life expectancy at birth: 52 years
Infant mortality per 1,000 births: 89
Female youth literacy: 67%
Number of people living with 22.3 million
HIV/AIDS
GDP per capita $624
PRESENT SCENARIO OF BILATERAL
TRADE BETWEEN THE NATIONS
 In 2008-09, bilateral trade between the two countries:
◦ South african exports – $5.44 million
◦ Indian exports -$1.97 billion .

 In 2010 the exports to Central Africa amounted to $ 278 milion,

whereas it was $2.6 billion for the rest.

 Exports to Central Africa stood at a meager $278 million.

 While shipments to the South, East and West African regions

were in the range of $2.6 billion during the April-January, 2010,
period.
 2005-06 2006-07 2007-08 2008-09 2009-10
Apr – Dec

India’s 11,892.39 19,770.29 26,467.55 30,295.16 21,712.41

total
trade
with
Africa
Total 7,013.56 8,407.53 11,539.57 11,354.82 7,606.26
exports
from
India to
Africa
Total 4,878.83 11,362.76 14,927.98 18,904.34 14,106.15.
imports
of India
from
Africa
Global trade flows – Export growth

Growth in export volumes

18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
2003 2004 2005 2006 2007 2008

World Developed Developing Africa

Source: UNCTAD (2009), Trade and Development Report, 2009
Global trade flows – Import growth

Growth in import volumes

20%
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
2003 2004 2005 2006 2007 2008

World Developed Developing Africa

Source: UNCTAD (2009), Trade and Development Report, 2009
African trade growth

Exports (value) Imports (value)

700 500

450
600
400

500 350

300
400
250
300
200

200 150

100
100
50

- -
2001 2002 2003 2004 2005 2006 2007 2008 2001 2002 2003 2004 2005 2006 2007 2008
SSA North Africa SSA North Africa

Source: DNA, ITC TradeMap Database, values are in US$ billions

Global FDI flows

Inward FDI inflows, US$m

1,600,000

1,400,000

1,200,000

1,000,000

800,000

600,000

400,000

200,000

-
2000 2001 2002 2003 2004 2005 2006 2007 2008

Developed (incl. Transition) Africa Latin America and Carribean Asia (incl. Oceania)
Source: UNCTAD (2009), FDI Database
African FDI inflows

Inward FDI inflows, US$m

100,000
90,000
80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
-
2000 2001 2002 2003 2004 2005 2006 2007 2008
Eastern Africa Middle Africa Northern Africa Southern Africa Western Africa

Source: UNCTAD (2009), FDI Database

POTENTIAL FOREIGN DIRECT INVESTMENTS IN
AFRICA

 AGRICULTURE

 PHARMACEUTICAL PRODUCTS

 EDUCATION & IT

 COMPUTER HARDWARE AND RELATED PRODUCTS

 CONSTRUCTION MACHINERY AND HEAVY EQUIPMENT

 DIAMONDS AND GEMS AND JEWELERY

 INFORMATION TECHNOLOGY

 ENGINEERING GOODS & COMMUNICATION

FOCUS COUNTRIES
GHANA
 Drugs & Pharmaceuticals
 Cotton yarn Fabrics
 Machinery and Instrument
 Inorganic / Organic Chemicals
 Plastic & Linoleum Products
 Primary & Semi finished iron and steel
 Transport Equipment's
 Glass / Glassware and Ceramic products
SCOPE FOR STRENGHTENING &
DIVERSIFICATION IN
 Food processing
 Textiles & Readymade garments
 Footwear
 Timber & wood products
 Cement plant
 Exploration of mineral services
 Tourism
KENYA
 Machinery & instruments
 Drugs and Pharmaceuticals
 Cotton yarn and fabrics
 Transport Equipment
 Iron and Steel Bars/ Rods
 Auto Components, spares and parts
 Inorganic and Organic chemicals
 Footwear
 Spices
 Glasswear
 Paints
 Cosmetics
OTHER INVESTMENT OPPURTUNITIES IN KENYA

 Sugar
 Textiles
 Cement
 Chemicals
 Light engineering industries
 Food & agro processing
 Tourism
MAURITIUS

 Drugs & Pharmaceuticals

 Dairy products
 Cereals and Preparations
 Meat and meat products
 Rice
OTHER INVESTMENT OPPURTUNITIES IN MAURITIUS

 Telecom
 Water treatment projects
 Irrigation
 Industrial air conditioning
 Light engineering
 Civil construction
NIGERIA

 Drugs & Pharmaceuticals

 Machinery & instruments
 Transport Equipment
 Manufacturer of metals
OTHER INVESTMENT OPPURTUNITIES IN NIGERIA

 RMG Cotton including accessories

 Inorganic &Organic Chemicals
 Paper, wood products
 Plastics and linoleum products
 Transport equipment
SOUTH AFRICA

 Drugs & Pharmaceuticals

 Machinery & instruments
 Transport Equipment
 Auto Components spares and parts
 Leather footwear
 Rice
 Spices
 Plastics
 Iron & Steel bars/rods
 Food processing
TANZANIA

 Drugs & Pharmaceuticals

 Fine Chemicals
 Inorganic Organic chemicals
 Paper wood products
 Manufacture of Metals
 Machinery and Instruments
Measures aimed at boosting trade under FOCUS AFRICA
Programme

 Preferential Trade Agreement / Free Trade Agreement

 Enhanced Interaction

 Institutional Mechanisms

 Trade Missions

 Trade Promotion Measures

 Role of National Centre for Trade Information (NCTI) in

providing useful Trade Information
STRATEGIES FOR PROMOTING INDIAN GOODS IN AFRICA

 India –African Forum.

 “Focus Africa” initiative by the Commerce

Ministry
 “India Development Initiative” by The Finance

Ministry.
 Funding mechanisms by the Ministry of

External Affairs
 A.P’s deal with Kenya and Uganda.

 Strategic plan of Department of Commerce

reached a benchmark of $8.36 billion by 2010.

 Feasibility and pre-feasibility reports

 Foreign Trade Policy for 2009-14,

announced market-linked incentives for
exports to African countries.

 India’s Exim Bank has extended Lines of

Credit (LOCs) for the COMESA Region to
support export of eligible.
EXHIBITIONS&DELEGATIONS
 2006-07
 INDEE CAIRO together with MACTECH 2006, Cairo, Egypt
 India Pavilion at SAITEX 2006, Johannesburg
 Multi Product Trade Delegation to South Africa, Botswana,Mozambique &
Namibia
 INDIA ENGINEERING MEET , New Delhi
 2007-08

 India Engineering Exhibition (INDEE), Johannesburg

 Multi Product Trade Delegation to Algeria & Morocco
 Tanzania Intl. Trade Fair combined with BSM at Kenya & Uganda
 Indo Africa BSM at Coimbatore
 2008-09

 Multi Product Trade Delegation to SADC & West or North African Countries
 INDUSMACH at Dar-e- Salaam,Tanzania
 Indo Africa Buyer Seller Meet at Kolkata and Mumbai
 2009-10

 Multi Product Trade Delegation to African Countries

 Inndia Pavilion at SISTEP 2009, Casablanca, Morocco
 Indo Africa Buyer Seller Meet at Kolkata and Mumbai
Indian Entities targeting Africa
 Bharti clinches Zain Telecom’s 15-country Africa operations in
$10.7bn buyout

 Bharti calls off $23-bn telecom deal with MTN

 Indian FMCG firms eye Africa as next growth vehicle

 Godrej Consumer Products Ltd is among the early movers with

recent buys in Nigeria and South Africa, while Marico Ltd , Dabur
India and Emami are other firms following this trend

 Vedanta Resources, the metals and mining major, to invest another

$1.5 bn in Zambia

 Indian IT companies eye African markets for business expansion

 Infosys Technologies, offered Finacle 10 and
Finacle Financial Inclusion solution for banking
transformation and power innovation for banks in
East Africa.

 TCS, to enter South Africa in 1995

 The Indian outsourcing company Tata Consultancy

Services has a business unit in South Africa

 Indian Company VNL to Launch Low-Cost, Solar

Base Station targeted at African operators Russell
Southwood
MARKET POTENTIAL IN AFRICA
Products Potential Market
Machine for textile apparel & Leather Tanzania, Kenya & Congo
Products

Medical & Surgical equipments Ethiopia

Motor Vehicles Egypt, South Africa, Algeria

Structural Metal products & parts Nigeria, South Africa, Sudan, Ethiopia,
thereof Namibia

Ovens & Furnaces Nigeria, Tanzania, South Africa

Special Purpose Machinery & Parts Nigeria, Kenya, South Africa, Egypt,
thereof Algeria

Fabricated Metal Products Tanzania, Mozambique, Egypt, Tunisia.

Trade prospects

 Dynamic role in economic growth and development,

economic deregulation and liberalisation, financial and
monetary stabilisation ambitious depreciation relaxing
controls on FDI and free repatriation of investment proceeds
and profits, etc

 The leading sectors attracting FDI in sub saharan Africa

 The sub saharan African countries perceived to be the most

attractive to foreign investors are South Africa, Nigeria,
Botswana, Ivory Coast and Tunisia
Indo-sub saharan Africa co-operation:some obstacles

 Sub -saharan Africa accounted for only 6.3% of india’s exports and 9.0% of
india’s imports in 2006

 Commercial information about several sub saharan African countries is not

readily available

 Lack of knowledge of specific projectssub saharan Africa

 Wrong perceptions exist in sub saharan Africa about the poor quality of Indian
products

 Advisable to have local partners, a mechanism for identifying reliable partners

in sub saharan African countries.

 Need for the buyers and the sellers to directly negotiate with each other
 No direct freight or shipping services to most of the sub
saharan African countries

 Immense mineral wealth and bulk of world reserves of several

minerals

 Other potential of exports from India to sub saharan Africa

include textiles and garments, drugs and pharmaceuticals,
electronic goods, household appliance, bicycles and parts,
automobiles and auto components, gems and jewellery,
foodstuffs, leather and leather goods,rice, tobacco, machine
tools, processed fruits and vegetables and their products,
computer hardware and software scientific instruments, etc
Suggestions
 Identify products on comparative cost advantage on account of
resource endowments and technological capabilities
 Encourage counter trade
 Identify and draw more on each other experience, technology
expertise and resource
 Undertake joint marketing and promotional strategies for common
products
 Engage in joint harnessing of natural resource
 Identify specific projects and areas for setting up of joint ventures
and collaborations especially at the small and medium enter
prose(SME) level
 Create joint research and development
 Encourage people-to-people and institution-to-institution
 Ensure manpower training and human resources development
 institutionalise mechanisms for exchange of commercial intelligence
and information on business opportunities and available
technologies