Indians could soon be able to acquire land in Myanmar. This hitherto reclusive country to the east of India is in the news and for all the right reasons. Myanmar, which held elections after 20 years in November last and has had a civilian government in power since then, was the focus both at the United Nations and in India where a delegation headed by its Commerce Minister, Mr U Win Myint came last week for the 4th meeting of the India-Myanmar Joint Trade Commission.

Twin-track initiatives

In less than a year of coming to power, the government in Myanmar has decided to take a number of new initiatives, the thrust of which is two-fold. While the first has to do with gaining acceptance at the international level, Myanmar is also looking at India for investments, particularly in joint ventures or foreign equity participation by Indian companies.

Hence, on September 27, the UN Secretary General Ban Ki-moon made a statement after the Groups of Friends of the Secretary General on Myanmar met at the ministerial level in which he said, “We recognise the significance of recent developments in Myanmar The Secretary-General also added, “Real opportunities for progress exist, but the Government must step up its efforts for reform if it is to bring about an inclusive and irreversible transition.”

Coincidentally it was on the same day that a delegation led by Mr U Win Myint was in Delhi for the 4th meeting of the India Myanmar Joint Trade Commission.

Realising the importance of economic development, the Myanmar Government has come up with a slew of measures to take its economic relationship with India further. It has come up with a foreign direct investment policy and is working on a new land policy that will allow foreigners to buy land in Myanmar. Earlier land could only be got from the Government; but this new land policy, which is expected to come into force soon, will mean that private players can own land in the country and land use regulations are likely to be more flexible.

Myanmar is also looking at India's participation in manufacturing and services, particularly the information-communication-technology sphere. Agriculture, which is the mainstay of Myanmar, is another sector in which itis keen to cooperate with India.

Ample scope

For India, these developments can only spell good news. There is ample scope for Indian investments to increase in Myanmar. Currently, Indian investments stand at about $ 189 million in five projects, giving it the 13th position among all the countries which have investments in Myanmar. Indian investments have been restricted to the Government's involvement in over a dozen infrastructure and non-infrastructure projects. There is also an ADSL project for high speed data link in 32 Myanmar cities which has been done by TCIL. ONGC Videsh, GAIL and Essar are taking part in the energy sector while a heavy turbo-truck assembly plant by Tata Motors with financial assistance from the Government was inaugurated in December last .

Similarly, there is huge potential to increase border trade between the north-eastern part of India and Myanmar, but India at the moment stands at the bottom of the pile among the four nations with which Myanmar has border trade. Though bilateral trade between the two countries increased from $12.4 million in 1980-81 to $1207.56 million in 2009-10, there is scope to increase this further. Currently, India's imports are dominated by agricultural items while its main exports to Myanmar are primary and semi-finished steel and pharmaceuticals. India and Myanmar are signatories to the India-Asean Trade in Goods Agreement and Myanmar is also a beneficiary country under India's Duty Free Tariff Preference Scheme for LDCs. Myanmar is also a strategic partner for India. Close cooperation between the two can also mean that India gets access to oil and gas reserves which Myanmar has in abundance. Further, Myanmar can also serve as a bridge between India and the Asean.

(This article was published on October 10, 2011)
XThese are links to The Hindu Business Line suggested by Outbrain, which may or may not be relevant to the other content on this page. You can read Outbrain's privacy and cookie policy here.