India and Indonesia are set to reach their target of trade worth US$25 billion by 2015 ahead of schedule. The Union Minister for Commerce Industry and Textiles, Shri Anand Sharma reviewed the business ties between the two countries with his counterparts in Jakarta yesterday. We now see ourselves achieving the next target of US$ 25 billion by 2015 comfortably. With the implementation of India-ASEAN FTA by us since October last year, the trade and investment flows between our countries would accelerate and would help achieve and exceed the target easily, said Shri Anand Sharma.
Both sides have agreed to speed up negotiations on bilateral CECA. Shri Sharma emphasized that Indonesia need to improve its offer on services in the context of the Indian ASEAN FTA in services and investment. Shri Sharma also pushed for movement of professional under mode IV both in context of India-ASEAN FTA as well as further investment opportunities in future.Opening up the two economies for service trade would be a win-win situation for both the countries observed Shri Sharma. Indonesia does not allow movement of professionals in health and banking sector. Mr Gita Wirjawan, the Minister for Trade, Indonesia agreed to take up these issues with the Health department and the Central Bank of Indonesia. Shri Sharma also flagged important issues relating to the non-tariff barriers for our pharmaceutical sector and the import of bovine meat into Indonesia. The Indonesian minister acknowledged that it was important for Indonesia to have more open regime for trade and investment in all three sectors as this would benefit Indonesian consumers by bringing down prices and providing opportunities for investments from India.
Shri Sharma also raised the issue of new mining laws and certain new regulations that have affected Indian mining and IPPs in Indonesia. Indian mining companies are obliged to export coal at benchmarked prices announced monthly by the Ministry of Industry in Jakarta. This has upset the calculations of a large number of IPPs who had submitted bids in India for power projects assuming certain (lower than benchmark) pricing of coal on the basis of coal mines operated by them in Indonesia. The Indonesia Trade Minister responded favorably to Shri Sharma™s request for the review of the policy.
In order to further the economic cooperation both side decided to institute five new working groups in the fields of
(i) Health care, pharmaceuticals and bio-technology
(ii) Mining
(iii) Agro-processing and food processing
(iv) Research, development and technology
(v) Skill training
Shri Sharma also inaugurated India show in Jakarta. 72 companies representing large corporate to SMEs in India ranging from agro-processing, manufacturing and mining to other sectors are participating in the show. On the sidelines of India show a networking session between India and Indonesian business leaders focusing on health care, coal mining, oil and gas, banking and insurance was organized.
Bilateral trade between India and Indonesia has been US$ 20.136 billion in 2011 while it was US$ 14.128 billion in 2010. Total exports to Indonesia were US$ 6.56billion in 2011 as compared to US$ 4.43 billion in 2010 while total imports from Indonesia were US$ 13.57 billion in 2011 over US$ 9.69 billion in 2010. India-Indonesia bilateral trade has grown at a robust compounded annual growth rate of about 30% over the last 5 years.
Apart from Mr. Gita Wirjawan, Shri Sharma also met with Mr. Hatta Rajasa the coordinating Minister for Economy and Mr. Mohammed Hidayat, Minister of Industry in Jakarta.
