When the Confederation of Indian Industry decided to set up an India Business Forum (IBF) here last March, they were pleasantly surprised to discover that as many as 36 Indian companies have resident offices in South Africa.
Surprised because, since 1948, India had enforced economic sanctions against the apartheid regime with such vigour that a flourishing trade in commodities like jute and tea had come to a grinding halt and by the time we resumed full relations in 1994, our economic and commercial links were non-existent. Trade is booming, as the accompanying articles attest.
Investment flows are another important indicator of the growing economic partnership. Accurate FDI data is much harder to obtain than trade statistics, but we estimate that Indian companies in South Africa are currently executing projects to the tune of more than $2-billion. These cover a broad range of sectors including automobiles, metallurgical industries, telecommunications, pharmaceuticals, processed foods, software development, minerals beneficiation, hospitality and financial services.
Several Indian companies have strong social responsibility programmes in place. To take just a few examples:
- The Tata group is taking 50 unemployed women graduates to India for internships and provides bursaries to deserving students at the University of the Witwatersrand.
- Satyam has already taken 50 young South African graduates to their state-of-the-art IT facility in Hyderabad for a year-long programme that includes nine months of on-the-job training.
- Ranbaxy plans to take chemists and pharmacists to India for training and will start enrolling local staff in an online training programme for its Be-Tabs facility.
- Rosy Blue and KGK are training and employing several hundred local staff in their diamond-cutting and -polishing facilities in Cullinan and in Jo’burg’s CBD.
- Neotel is setting up a Telecom Training Academy in Jo’burg to meet its needs for skilled professionals.
- The Confederation of Indian Industry is in dialogue with the Umsobomvu Youth Fund to set up separate training centres for IT and vocational skills.
But this is not a one-sided relationship. As the Indian economy grows annually at 8% to 9%, several South African companies have moved quickly to position themselves in a trillion-dollar economy with a middle class of more than 300-million.
Airports Company South Africa and Bidvest have won the huge contract for expansion and upgrade of Mumbai International Airport; SAB-Miller is now India’s second largest brewer; Altech will soon start supplying set-top boxes to the Indian market and FirstRand Bank has become the first African bank to establish a presence in India, joining financial services majors Old Mutual and Sanlam, which have already been around for a while. Sasol, De Beers, BHP Billiton, Batemans and Tiger Brands are some of the other major local players looking for a piece of the action. The Sahara group is executing substantial projects in both countries.
In doing so, the private sector in both countries is giving concrete shape to the somewhat nebulous concept of South-South cooperation. Indian pharmaceutical companies are playing a key role in making healthcare more affordable for low-income communities in Africa and elsewhere. They were largely responsible for bringing down the price of an antiretroviral dose from an extortionate $30 per day to the much more reasonable level of about $220 for an entire year — or just 65 cents per day!
When President Thabo Mbeki and Prime Minister Manmohan Singh set the ambitious target of trebling bilateral trade by 2010 as part of the Tshwane Declaration signed in Pretoria last October, we started to draw up a work plan that will take us towards this goal; help us make up the lost time.
As Mahatma Gandhi put it in a different context almost a century ago in Johannesburg in 1908, “If we look into the future, is it not a heritage we have to leave to posterity, that all the different races co-mingle and produce a civilisation that perhaps the world has not yet seen?”
And that really sets a challenge for us, in government and in the business community. Can we harness the synergy, the complementarity between our countries and our economies to truly produce a model of economic partnership, of south-south cooperation, that the world has not yet seen?
Navdeep Suri is India’s consul general in South Africa