American investors should well be aware of the emerging economies growing rapidly on the continent of Africa. Indian industry has already put into action a collaborative effort with the national government to develop strategies toward competing with China and European nations for capturing these business growth opportunities, particularly in East Africa.
India’s Commerce and Industry Minister Anand Sharma accompanied a delegation representing 187 Indian companies to “Namaskar Africa,” meetings held October. 14-15 in Nairobi, Kenya. This event involves a series of opportunities promoting India-Africa business networking organized by the Federation of Indian Chambers of Commerce and Industry (FICCI).
Part of the strategy has Sharma meeting with the top Kenya government representatives – President Mwai Kibaki and Prime Minister Raila Odinga. Additionally, FICCI President Rajan Bharti Mittal, vice chairman for Bharti Enterprises, leads the Indian business delegation that has expressed a strong interest toward developing telecom business opportunities in Africa.
India currently experiences bilateral trade of $30 billion throughout Africa. Efforts are underway to expand trade into East Africa where trade revenue is much lower at $4 billion. The countries with representatives meeting with Indian counterparts include Uganda, Ethiopia, Rwanda, Kenya and Seychelles.
A challenge toward successfully competing has brought together both industry and government leaders in India in order to devise a plan that will “level” the field. In a study released by FICCI, one strong competition challenge presents itself because Chinese companies are government-owned with far greater capital at hand for investment than any privately owned Indian companies. According to the report India is attempting to counter the offers from Europe and China by extending credit lines to African companies. “This will help source capital goods from India,” Mitra said in the report.
Africa has experienced 5.4 percent economic growth throughout the past decade and the outlook is rapidly improving. The FICCI report further states that: “For the first time in over three decades, a large number of African countries have begun to show sustained economic growth at the rates that are similar to the rest of the developing world and exceed that of most of the developed countries. The study discovered several areas of opportunity for Indian companies in addition to telecom including healthcare and pharmaceuticals, road and railway construction, general construction, power and mining.
