India, Africa trade ties take quantum leap

India and Africa on Saturday vowed to strengthen trade-related capacity by concluding cooperation agreements between India and African Regional Economic Communities (RECs) even as both sides joined hands for a speedy conclusion of the Doha round of global trade talks.

This was decided at a meeting between Commerce and Industry Minister Anand Sharma and the trade ministers of all African countries. The meeting was held against the backdrop of the Prime Minister Manmohan Singh’s visit to Ethopia, which starts on May 23. This would be the first such visit by an India head of state.

“We take note of the great potentials for mutually beneficial trade between Africa and India, and agree on the need to strengthen the trade relationship between the two sides through, the building of trade related capacity and the conclusion of trade cooperation agreements between India and African RECs,” said a joint statement. The meeting took place on the sidelines of the India-Africa Forum Summit organised by the Confederation of Indian Industry.

Both sides discussed the contentious issue of subsidies to cotton farmers in developed countries which is adversely impacting the livelihoods of poor African countries that rely heavily on cotton farming, especially Burkina Faso, Benin, Chad and Mali, which is also referred as the Cotton Four or C-4 Group in trade parlance.

“We are committed to the core principles of Special and Differential Treatment and obtaining more preferential treatment for all LDCs (least developed countries). We acknowledge the common platform shared by India with the African Group on the issue of subsidies to cotton farmers in developed countries,” the statement said.

It was also decided that trade ministers would meet prior to every India-Africa forum summit and the ‘India-Africa trade ministers’ dialogue’ would be an annual event. This was done keeping in view of the increasing trade and investment flows between India and Africa.

India –Africa investments reached $90 billion while bilateral trade topped $46 billion in 2010. Both sides on Saturday agreed to increase trade to $70 billion by 2015 with greater focus on infrastructure, energy and capacity building. India is particularly focused on Nigeria and Sudan for greater cooperation on energy. India is heavily dependent on these two countries for securing oil.

India on Saturday also offered duty free tariff preference scheme for 33 least developed countries in Africa, which covers 94 per cent of India’s total tariff lines. India and Africa is also jointly setting up ‘Africa-India Institute of Foreign Trade’ in Kampala, Uganda.