Deputy Minister Aziz Pahad to host Indian Counterpart, Minister of State for External Affairs Anand Sharma

Tshwane - South African Deputy Foreign Minister Aziz Pahad will hold bilateral political and economic discussions with his Indian counterpart, Minister of State for External Affairs Anand Sharma in Tshwane on Friday, 24 March 2006.

Discussions between Deputy Minister Pahad and his counterpart come within the context of South Africa's priority to promote South-South co-operation for increased market access, trade and investment. In this regard, South Africa together with India and Brazil constitutes the India-Brazil-South Africa (IBSA) Forum, a historic partnership of countries of the South that aims to achieve the afore-listed objectives in the interests of eradicating poverty and underdevelopment while creating a better life for all people of the South.

Issues on the agenda of discussions between Deputy Minister Pahad and Minister of State for External Affairs, Anand Sharma are expected to include, among others:

  • The status of bilateral political and economic discussions between both countries that are governed through the Joint Ministerial Commission and the South Africa - India CEO's Business Forum;
  • A briefing on developments in the SADC region and the Indian sub-continent, including the first India-SADC Forum scheduled for Namibia in April 2006;
  • Developments in the operationalisation of the institutions of the African Union and the implementation of NEPAD, including the current status of the Pan-African e-connectivity project; and
  • Developments within IBSA.

Bilateral Economic Relations

CEO's Business Forum

The Indo-South Africa CEOs Business Forum was launched in October 2004, after President Kalam's State Visit to South Africa. Consisting of several Indian and South African businesses, this Forum aims to assist in stimulating trade and investment between the two countries.

The launch of the Indo-South Africa CEO Forum was attended by leaders of a number of top companies from both countries, amongst them Mr Ratan Tata who is also a member of President Mbeki's International Economic Advisory Council.

The second meeting of the CEOs Forum in Mumbai on 2 May 2005, identified the following areas of co-operation: Mining & minerals, gems & jewellery, power generation, infrastructure development, information and communication technology, pharmaceuticals, HIV/AIDS, and tourism. It was proposed that Working Groups be set up for the areas that have not been covered by the existing Working Groups. The Working Groups that are already in place include ITC, Energy, Infrastructure, Education and Skill Development, Mining, Auto components and Tourism.

Economic Relations

The main Indian products exported to South Africa are: motor-cars and vehicles for the transport of goods, rice, medicaments, cotton, yarn finished leather goods, machinery and instruments, handmade yarn fabrics, spices, handicrafts and handmade carpets.

Main products imported from South Africa are chemicals, gold, silver, coal and briquettes, iron and steel, inorganic and organic fertiliser, pulp and waste paper, and precious and semi-precious stones.

Trade between South Africa and India continues to grow. In 2005, total bilateral trade approached a level of R14.5 billion, with imports from India at R7.02 billion and exports to India at R7.5 billion. India currently ranks as South Africa's 13th most important export market and the 13th most important import market.

The sheer size of the Indian economy (14th largest manufacturing economy in the world) gives it an influential position in the global market in which South Africa has a key interest. Since South Africa and India have similar developmental challenges, their collective capacity in bargaining and voicing concerns that affect their economies in international forums is made highly effective. As a key emerging regional economy, India provides a platform for the re-integration of the South African economy with that of South Asia.

Opportunities for closer co-operation in the following sectors have been identified and form part of South Africa's trade development agenda in India:

Capital equipment (construction and related infrastructure): SA Airports companies made a successful bid for the upgrading of the Mamba Airport. (However, there is some controversy around this bid concerning the tender process.) During the President's Visit to India, former Minister of External Affairs, Mr. Yashwant Sinha expressed India interests on receiving assistance in areas of electricity/power generation as well as mining technology.

Agro-processed products: SA firms wish to share expertise in food processing with India.

Autos and components: TATA Motors has already established a presence in South Africa and Mahindra Motors has also expressed interest to commence exporting vehicles to South Africa.

Services: Engineering and financial services are increasingly attracting attention.

ICT: India's information communication technology prowess (software development) has attracted attention and South Africa has begun to engage relevant firms. Tie-ups and memoranda of understanding have been signed between the two nations. South Africa views India's technical pool in ICT as holding promise for future co-operation between the two countries. Co-operation in space technology offers further opportunities.

Science and Technology: India's technical manpower pool has been noted as providing impetus for closer co-operation with South Africa, especially in software development. Other areas of assistance are Biopharma and Biotechnology as noted by the President during the visit to the Center for Cellular and Molecular Biology (CCMB) in Hyderabad in October 2003.

Health: South Africa would like to learn more about the traditional knowledge system development (institutionalising traditional knowledge in medicines)

SMME: Co-operation in SMME development, jewellery and between the two countries' CSIRs is ongoing.

Issued by Ronnie Mamoepa on 082 990 4853

Department of Foreign Affairs
Private Bag X152

23 March 2006

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