Indo Africa Summit- Opportunity For Indian MSME In Africa

Indo Africa Summit-Opportunity For Indian MSME In Africa

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What is the current status of African Nations?


What is the current status of African nations?

Economic1. Infrastructure spending in Africa is estimated to reach $93 billion per year and tax revenues and other domestic resources will not be enough to fill the financing gap for infrastructure projects.2. Portfolio investments in equity markets, domestic bond markets, and Eurobond markets are increasing3. Financial Services still have low penetration

Political1. Political Turmoil and Civil War in some countries 2. Strict custom transactions, involves lots of parties, lack of regional integration

Source: http://www.brookings.edu/


Social1. Number of people on the continent reportedly living under $1.25 a day has reached to 415 million in 2011 2. Different culture and religion share space and are deeply intertwined in African cultures

Technology1. The rise of Silicon Savannah has created a huge IT potential.2. Information and communications technology (ICT) needs to remain on high priority in spite of the rapid growth in mobile phones and mobile banking.

http://www.brookings.edu/


Strengths: 1. Rich in minerals and metals including gold and diamond2. Rich source of oil and gas reserves3. Rising middle class that has huge potential for consumer spendingpresence of market friendly policies in several countries such as Rwanda, Nigeria, Egypt and Morocco4. Highly sophisticated and sound banking and financial services sector in its major economies5. Aggressive skills development programmes such as research and human resources

African Map For Energy Resource


Weakness:1. Banking, Telecom and retailing still have a low penetration in many parts of the continent 2. Highly volatile security market3. Political Turmoil and Civil War in some countries such as Libya, Algeria, Egypt, Morocco and Tunisia4. Inadequate Infrastructure5. Adverse Weather Conditions6. Natural disasters

African Climatic Conditions

Value of Exports to Sub Saharan Africa

Source: IMF

The International Monetary Fund has determined that the value of India’s exports (now largely high-end consumer goods) to Africa have increased by over 100 percent from 2008 to 2013—meaning that India has now forged ahead of the United States in African markets. However, although they benefited from Africa’s robust economic growth, India’s gains do not quite compare to China’s astronomical increase in exports to Africa

Value of Imports from Sub-Saharan Africa

Source: IMF

The value of India’s imports from Africa also grew dramatically from 2008-2013—by over 80 percent—compared to the sharp decline in the value of imports from sub-Saharan Africa to the United States The decrease in U.S. imports from Africa was likely caused by the development of American hydraulic technology, which lessened U.S. dependence on African oil and gas

African FDI Stock in Host Countries

Source: UNCTAD Bilateral FDI Statistics

Another noteworthy trend is Africa’s growing foreign direct investment in India. Since 2010, Africa’s FDI in India has proven consistently high compared to its FDI in countries such as China and the United States. However, the primary reason for this is that Mauritius is the biggest source of FDI into India.

Areas Where India and Africa Can Work Together


Sectors where India can help African nations

AgricultureAfrica’s aspired “green revolution” could raise its agricultural output from USD 280 billion in 2010, to around USD 880 billion by 2030. Indian msme can offer its expertise in manufacturing, and robust distribution networks in agrochemicals, fertilisers, farm equipment, etc to help African agriculture.

DefenceDefence cooperation with Africa is an attractive option given Africa spends heavily on military and India is the world’s largest arm importer. In fact, India recently signed a deal of USD 80 million with South African companies for integrated self-protection systems on its domestically designed Dhruv Advanced Light Helicopters.

Textile and FashionThere are huge takers for India fashion and apparels. Indian msme can establish joint ventures with African retailers to have a better reach in this segment.

Source: McKinsey and KPMG Reports


SERVICESIT Sector:Africa is expected to triple its IT spend to USD 80 to 95 billion by 2025. Indian MSME can offer technical expertise in verticals such as mobile apps, banking platforms etc., the ability to develop local talent, as well as the capabilities to set up low cost IT parks.

Infrastructure:North Africa’s high electrification rate guides the compass of opportunity there—by 2040, Sub-Saharan Africa’s electricity consumption of around 1,600 TWh will represent a USD 800 billion opportunity. Many Indian players such as Nava Bharat Ventures, Tata Power, JSPL and Essar have entered the African power sector.

HealthcareAbout 80% of medicines to poor African nations are provided by India. India’s pharma products have saved millions of lives in Africa. India also plans to train doctors and healthcare personnels.



KNOWLEDGE:

Research and DevelopmentThe Pan-African e-network is already in practise and connects hospitals and universities in 48 African nations to their Indian counterparts.25,000 scholarships for students across Africa have also been provided by New Delhi.

Medical Tourism‘First World Treatment at Third world Prices’ is attracting medical tourists to India from all over the world.India provides quality treatment at affordable prices. indian healthcare revenues are expected to reach $160 billion by 2017, as per a report by India’s Brand Equity Foundation. Fortis, Escorts and Medanta are leading this change.


Indian and African Trade Organizations to contact for support


African Organizations Where Traders Can Communicate

Major trading arrangements in Africa include:

1. Common Market for Eastern and Southern Africa (COMESA)

2. Southern African Development Community (SADC)

3. Southern African Customs Union (SACU)

4. West African Economic and Monetary Union (UEMOA)

5. Economic and Monetary Community of central Africa (CEMAC)

6. Indian Ocean Commission

http://www.comesa.int/

http://www.internationaldemocracywatch.org/index.php/central-african-economic-and-monetary-community

http://www.commissionoceanindien.org/accueil/

Support from the Indian Government


List of Indian Trade Organizations To Contact For Help

Project Exports Promotion Council of IndiaPlace: NEW DELHITel: 91-11-23722425, 23350367E-mail: [email protected]:http://www.projectexports.com/

Export Promotion Council For Eous & SEZ UnitsPlace: New delhiTel: 26165805, 26167042,EMAIL : [email protected]: http://eouindia.com

For Industry specific trade organization follow the link: http://focusafrica.gov.in/export_promotion_councils.html

http://focusafrica.gov.in/export_promotion_councils.html

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Indo Africa Summit- Opportunity For Indian MSME In Africa

Small Business & Entrepreneurship