India-South Africa commercial alliance meeting in India

Friday, 22 August 2003, 07:00 Hrs
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JOHANNESBURG: The third meeting of the India-South Africa Commercial Alliance (ISACA) will take place in Delhi on Tuesday.

Led by Alistair Ruiters, the director general of the South African Department of Trade and Industries (DTI), the meeting will provide an opportunity to prepare some pacts to be ratified during a visit by President Thabo Mbeki in October.

ISACA was first mooted in 1997 after then Indian prime minister I.K. Gujral visited South Africa to promote co-operation between the private sector of the two countries.

"The meeting next week will include consultations and discussions between Commerce Secretary Deepak Chatterjee and Ruiters," Indian Consul-General Suresh Goel told IANS.

Chatterjee led the Indian delegation during the second ISACA meeting held here in June last year.

"There will be presentations made by the Indian Trade Promotion Organisation, which is a trade promotion agency working under the Commerce Ministry in India.

"There will also be presentations made by the private sector on co-operation in different areas of interest."

These areas include engineering, pharmaceuticals, chemicals, information technology, investment, joint ventures, technology transfers, food processing, the small and medium enterprises sector, tourism and entertainment and project exports.

"We expect that there will be representatives from the two sides who will be able to interact with each other effectively in order to see how things can happen in future."

Elaborating on a few areas, Goel said: "The engineering sector will also include the automotive sector. There is a possibility of us seeing how we can work on supplying the South African sector with auto ancillaries.

Many Indian companies are suppliers of the ancillaries to original equipment manufacturers like BMW and Mercedes in Germany and Ford in the U.S. They import directly from India, and since many of these vehicles are also manufactured in South Africa, we can think of tie-ups.

"In pharmaceuticals, the strength of Indian companies has been established. Ranbaxy, Cipla and others are here already and others are also looking at South Africa, not only as a market, but also as an important base in the region."

Goel said there were also South African companies interested in joint manufacturing partnerships with Indian manufacturers.

The advantages that South Africa has in terms of the Africa Growth and Opportunities Act (AGOA) to export without restrictions to the US could benefit Indian manufacturers of textiles as well.

India could also benefit from South African technologies such as power distribution.

"Eskom (the electricity distribution body) in South Africa has done very good work and perhaps they could co-operate in seeing how the power sector in India can benefit.

"Another example here is Sasol, which has the ownership of the technology for coal to oil conversion."

Goel said apart from the traditional trade between India and South Africa, there was great potential for working together through investments and technology tie-ups.

ISACA would be looking at these in a very comprehensive way to see how private sector can co-operate with government support on both sides.

Goel conceded that ISACA efforts in the past had not been very encouraging.

"But the good thing is that this has been recognised by both India and South Africa, as has been the need to reactivate and rejuvenate the private sector to carry this process further.

"Having had 10 years of the democratic government in South Africa as well as the 10 years of South Africa and India having re-established diplomatic relations, there is greater recognition that we have built the basis and really need to carry this forward now.

"My interaction with the officials and the private sector in South Africa has shown that they want to do things with India, particularly because there are competitive advantages, such as pharmaceuticals that are cheaper than anywhere else in the world."

Goel said that much greater vigor has been added to the ISACA discussions because they are taking place on the eve of the presidential visit in October.

"Both sides are equally cognisant of the fact that we must show results during this meeting."

During a bilateral meeting in Pretoria last month, both External Affairs Minister Yashwant Sinha and South African Foreign Affairs Minister Nkosazana Dlamini-Zuma urged officials to conclude agreements that had been initiated urgently, so that they could be inked during the visit by Mbeki.

Goel said one of the matters to receive priority attention would be further negotiations on the preferential trade agreement between the two countries so that a framework agreement could be signed during the October visit.

This framework agreement would clearly specify and lay out the political commitment of the two countries to the process with a definitive time framework for it to go into operation early next year.

Source: IANS
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