'Indo-Africa trade: Lack of financing, poor infra major issues'
New Delhi: Lack of financing and poor infrastructure facilities are the two major constraints in enhancing trade and investment between India and Africa, a report said on Tuesday.
Although the bilateral trade and investment between the two has increased exponentially, "yet it is far away from the true potential", the joint CII-WTO report said.
India-Africa bilateral trade has grown from USD 1 billion in 2001 to around USD 50 billion in 2011-12.
India and Africa together account for a huge market of 2.2 billion people with a combined GDP of more than USD 3 trillion.
There has also been a surge in Indian private investment in Africa with big ticket investments in the telecommunications, IT, energy, and automobiles sectors.
"Lack of financing and poor infrastructure facilities are the two key constraints in India-Africa bilateral trade and investment," the report said.
It has listed few concerns of African traders that includes access to Indian buyers and trade finance.
On the other hand, transport and logistics costs and poor business environments are cited as major difficulties by Indian traders.
The report has suggested several steps to boost trade and investment between India and Africa. It said that to sustain the trade growth, there is an urgent need to broaden the trade basket.
It also suggested to increase cooperation between small and medium enterprises to enhance trade.
"...The commercial wings of Indian embassies in Africa can play a facilitating role by providing in-country research on market expansion opportunities available to Indian exporters," it said.
India's investment-led trade approach could help sustain the dynamic trade growth between India and Africa, and help extend trade both in terms of the number of partners involved and also the range of goods and services traded, it added.
"Investments for joint ventures between the countries would best open up the route for enhancing goods trade," it said, adding that greater cooperation in agriculture and agro-processing would have a great bearing on the food security situation in both Africa and India.