The Hindu Business Line : India, Uzbekistan resolve to step up bilateral trade

New Delhi, Sept. 21 India and Uzbekistan have identified that the favourable economic conditions and untapped potentials of both countries could help in boosting bilateral trade and investment in projects, with bilateral trade turnover in the first half of 2008 at close to $40 million.

Official sources told Business Line here that the eighth session of the inter-governmental commission on Trade, Economic, Scientific and Technological Cooperation between India and Uzbekistan was held here on September 16-17, chaired by the Union Minister of State for Commerce and Power, Mr Jairam Ramesh, and the Minister of Economy of Uzbekistan, Mr Batyr Khodjaev.

The sources said the bilateral trade turnover grew by 8 per cent in 2007 at $64.4 million, with exports from Uzbekistan to India at $9.5 million and exports from India at $54.9 million.

India adverted to the MoU the two governments signed in April 2006 and reiterated its commitment to establish Uzbek-Indian Entrepreneurs Development Centre in Tashkent and sought the Uzbek side to expedite the required clearance for the project.

The Commission emphasised that the efforts should continue for investment cooperation in processed food and agricultural products, information technology, petrochemicals, fertilisers, ferrous and non-ferrous metals and it also agreed to explore possibilities and facilitate investments in these sectors through mutual consultations.

The Commission also noted the possibilities to set up joint ventures in the area of gas-based petrochemicals and fertilisers in Uzbekistan.

Major investors

When contacted, Mr Jairam Ramesh said the Indian companies have emerged as major investors in Uzbekistan as they are in the five top non-oil sectors.

He said Spandex Textiles has invested $80 million employing 5,000 Uzbek workers and is the largest exporter of cotton yarn to Europe.

Another Indian firm Minda has invested $25 million for manufacture of automotive components, sourcing them from Uzbekistan.

Adani group is also planning to put up a food processing plant, making use of the abundant availability of fruits in that country, he added.

Mr Ramesh said that there is potential for cooperation in the field of power sector and BHEL could help in upgradation and modernisation of various power plants in Uzbekistan.

The sources said that as India allows cotton imports under OGL with no import duty and foreign equity participation up to 100 per cent through automatic route in the textile sector, it suggested to the Uzbek side to avail itself of the facility in India for cooperation in the textile sector.

The Uzbek manufacturer/exporter of readymade garments could also source the requirements of fabrics, denim and yarn from India.

The Uzbek side has signed five MoUs with Indian business enterprises in textiles and leather recently.

Both sides also agreed to facilitate the setting up of joint ventures for the production of textile products, silk processing and finished products in both the countries.

STC complex

Sources said that India also apprised the Uzbek side of the proposed move of the State Trading Corporation of India (STC) to establish a fully integrated complex comprising expellers, solvent extraction, refinery, bakery shortenings and margarine manufacturing in a suitable location in Uzbekistan.

It was also further agreed to explore fostering and enhancing inter-bank cooperation by providing loans on favourable terms to small and medium enterprises.

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