Commerce and Industry Minister Anand Sharma believes the Comprehensive Economic Cooperation Agreement, which is being negotiated by both countries, would enhance trade growth for both merchandise goods as well as services.
"I believe that this (trade target) is achievable," he told Malaysian journalists in an interview at his office in New Delhi last week, ahead of his two-day visit to Kuala Lumpur today.
Bilateral trade totalled US$10 billion between 2008 and 2009, up from US$2.94 billion in 2003-2004.
"There have been enormous opportunities for Indian companies in Malaysia. To date, there are 100 companies already present in Malaysia, of which 60 are involved in IT (information technology)."
Likewise, Malaysian companies have invested US$4.5 billion (RM14.5 billion) in the republic, mostly in construction and real estate as well as infrastructure, highways and light-rail trains.
"We hope more Malaysian companies will come to invest in the country. We have an investment friendly regime, with liberal FDI (foreign direct investment) policies in place."
India's FDI in May 2010 rose 5.6 per cent to US$2.21 billion compared with US$2.09 billion in the corresponding month in 2009.
"We are spending US$550 billion (RM1.8 trillion) on infrastructure, and in the coming decade India will be spending US$1.7 trillion (RM5.5 trillion) on infrastructure."
Sharma explained that most of the infrastructure projects will be undertaken in a PPP (private-public partnership) mode, which would continue to enable strong Malaysian participation in the construction sector.
"It is for Malaysian companies to identify the role they want to be in - they are now mostly in construction of highways, involved in consortium of airports, in transport sector and metro."
New Delhi's swanky new address, its US$2.5 billion (RM8 billion) Indira Gandhi International Airport (IGI) Terminal 3, touted to be one of the 10 largest in the world, will be operated by Malaysia Airports Holdings Bhd (MAHB) for the next 30 years.
Commercial relations have also been good, despite last year's slight dip due to the global contraction in trade.
Investments from both sides have gained momentum, led by Maxis Communications in Aircel, Axiata Group in IDEA Cellular, Khazanah Nasional Bhd in Infrastructure Development Finance Company (IDFC), Apollo Hospitals and Yes Bank, an Indian private bank.
Prime Minister Datuk Seri Najib Razak's visit to India early this year, identified the priority areas of engagement and the need to elevate relations - ranging from trade and investment to science and technology, railways, defence and new areas such as biotechnology.
On CECA, Sharma said an early conclusion embracing trade, investment and services will help improve Malaysia-India ties.
"Discussions are moving in the right direction and will be concluded in 2010.
"We have a mandate to take forward the negotiations and try to complete by 2010, it is moving in the right direction. We are optimistic."
Sharma is meeting International Trade and Industry Minister Datuk Seri Mustapa Mohamed today.
One of the highlights of his visit to Kuala Lumpur will be the launch of the CEO's Forum in Kuala Lumpur.
India has also signed a regional free trade agreement (FTA) with Asean, where trade has grown in excess of US$45 billion (RM145 billion).
Malaysia is among the first three Asean countries to implement the India-Asean Trade in Goods Agreement effective from January 1 2010.
It is now engaged with the regional bloc to come up with a trade pact on services.
In line with its Look East Policy, India is also engaged in a Comprehensive Economic Partnership in East Asia which involves Asean, Australia, China, Japan, South Korea and New Zealand.
India and Malaysia have enjoyed strong historical ties, Sharma said, and this goes back to after both countries got their independence from the British in the last century.
"We have seen exponential growth as our countries work together in a regional and multilateral framework."
Excerpts of the interview
Q: The bilateral CECA is up for a mid-term review. What is your current assessment? How do you see it boosting investments in Malaysia ?
Sharma: We are reviewing the progress of CECA negotiations on July 7 2010. We hope to provide further fillip and direction to these negotiations so that we are able to conclude by this year-end. The bilateral CECA will open up enormous opportunities for bilateral flow of goods, services and investments.
Q: What is the role India has in mind in shaping Malaysia's services sector? What are the sub-services sectors in which India could participate?
Sharma: Malaysia is a growing economy with huge services needs. India, on the other hand, has strength in financial, IT, banking and insurance, etc ... sectors that can meet the demand. We are also keen to provide services of professionals in Malaysia .
Q: Which sectors offer the most potential for Malaysia to invest in India and vice-versa?
Sharma: India offers opportunities to Malaysian companies in the field of infrastructure and manufacturing. Malaysian companies have already taken advantage of the potential in some sectors such as construction. Malaysian construction companies' largest presence outside Malaysia is in India. Malaysian companies should also look at investing in India's core infrastructure sectors and the manufacturing sector.
Q. How can India and Malaysia work together to drive more trade between India and the Asean countries?
Sharma: Malaysia is among the first 3 Asean countries to implement the India-Asean Trade in Goods Agreement from January 1 2010.
As the coordinating country for India-Asean negotiations, Malaysia needs to play an active role in the conclusion and signing of a liberal Services and Investment Agreement between India and the Asean during this year.
No comments:
Post a Comment