India is looking to further diversify its trade to relatively newer markers in Latin America and Caribbean Islands as well as South East Asia.
In this regard, Commerce and Industry Minister Suresh Prabhu is slated to visit Cuba and Panama this week to strengthen trade and investment ties with countries in Latin America and Caribbean Islands. Besides, a major meeting is being planned — likely to be held in late January, 2018 — with the trade Ministers of the 10-member Association of Southeast Asian Nations (ASEAN) bloc.
India’s bilateral trade with Cuba is minuscule at just $43.18 million in 2016-17. Of this, India’s exports to Cuba were worth $41.87 million, and imports from that country were only $1.31 million. The Indian government has provided Line of Credit to Cuba the tune of $173 million for projects including milk powder processing plant, bulk blending fertiliser plant, power co-generation project and wind farm.
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India and Cuba will also look at improving coordination on critical international trade matters including those related to the World Trade Organisation-level negotiations. Mr. Prabhu’s Cuba visit coincides with the (Trade) Fair of Havana in which several Indian export firms are participating. Mr. Prabhu is also expected to meet his counterparts from Cuba, Panama, Barbados, Suriname and Haiti.
On ties with ASEAN member countries, the government said India-ASEAN trade has risen to $70 billion in 2016-17 from $65 billion in 2015-16. The aim now is to ensure that bilateral trade touches $200 billion by 2020. According to industry body Assocham, (India’s) trade deficit with ASEAN had risen from $0.5 billion in 2005-06 to $14.6 billion in 2015-16.
The government also said ASEAN accounted for around 12.5% of investment flows into India since 2000. Foreign Direct Investment (FDI) inflows into India from ASEAN between April 2000 to May 2016 was $49.4 billion, while FDI outflows from India to ASEAN countries, from April 2007 to March 2015, was $38.67 billion, it added.
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ASEAN and India also have a Free Trade Agreement (FTA) to boost investments, as well as trade in goods and services. Besides, India and ASEAN are involved in negotiations for a mega-regional FTA called the Regional Comprehensive Economic Partnership with five other countries including China, Australia, New Zealand, Japan and South Korea. To ensure that Indian firms become a part of regional value chains and production networks, there is an India-initiated Project Development Fund with a corpus of $77 million to improve the prospects of Indian projects in Cambodia, Lao PDR, Myanmar and Vietnam.