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ECONOMY: Malawians Keen to Build Trade Ties with India

Claire Ngozo

LILONGWE, May 10 2011 (IPS) - Building on historical relationships, Malawians have set their sights on strengthening trade and investment relations with India in sectors as diverse as agriculture, telecommunications and pharmaceuticals.

Eunice Kazembe: Malawi's business environment will open regional markets to Indian products. Credit: Claire Ngozo/IPS

Eunice Kazembe: Malawi's business environment will open regional markets to Indian products. Credit: Claire Ngozo/IPS

Malawi’s interest in investment from India comes at a time when Africa’s regional economic giant, South Africa, is also strengthening its relations with the Asian country through the India-Brazil-South Africa (IBSA) dialogue forum. IBSA is a trilateral development initiative aimed at promoting South-South cooperation and exchange.

At the end of Mar. 2011, Malawian trade minister Eunice Kazembe attended the seventh India-Africa Business Conclave in New Delhi, India, where she approached Indian investors to explore trade opportunities in Malawi’s mining, tourism and energy industries.

The India-Africa Business Conclave is a yearly trade and investment event organised by the Confederation of Indian Industry (CII) and Exim Bank, which is India’s premier export finance institution, together with the country’s ministries of external affairs and commerce.

“There are so many untapped business opportunities in Malawi which India should explore,” Kazembe told investors gathered at the conclave. “The opportunities that exist in Malawi include that the country has enjoyed peace and tranquillity and a business environment that will open markets for your products across the region.”

According to a proposal from Malawi’s ministry of trade, the southern African country is seeking Indian investment in a pharmaceutical plant, especially for AIDS drugs. The plant’s estimated cost would be 800 million dollars.

Malawi is also looking for investment in automation machinery for the country’s tax collecting authority, the Malawi Revenue Authority, and is seeking markets for agricultural produce. Agriculture is the mainstay of the country’s economy and up to 85 percent of Malawians depend on the land for their livelihoods.

Kazembe’s trip followed a visit by Malawi’s President Bingu wa Mutharika to India in Nov. 2010 aimed at raising investment.

Malawian businesspeople also visited India in Oct. 2010, led by the country’s Malawi Confederation of Chambers of Commerce and Industry (MCCCI).

“The relationship should benefit both countries and improve the living standards of citizens,” said MCCCI chief executive officer Chancellor Kaferapanjira. MCCI went to India to promote investment opportunities in mining, general and agro-processing, information technology, manufacturing and healthcare.

Entrepreneurs such as James Kanduna of Mkando in Mulanje district, southern Malawi, have also woken up to the Indian potential. Kanduna is a farmer who grows pigeon peas.

In 2010 he went around talking to Indian traders based in Malawi’s commercial capital, Blantyre, asking if they could assist him in identifying a market for the pigeon peas he had been growing for seven years. “I learnt that India is a big consumer of pigeon peas and that there is a huge market for the crop,” Kanduna told IPS.

He received a telephone call in Nov. 2010 from an Indian trader who was visiting the country. “I had a meeting with him and four Indian traders based in the country and we agreed on modalities of shipping the produce to India. I have since stepped up my efforts and am expecting to harvest up to 20 tons which I will export to India,” said Kanduna.

The farmer said he would produce more in the next growing season if he finds the Indian market lucrative.

A number of private companies with Indian connections have made major advances in Malawi. One such company is Rab Processors Ltd, founded in 1983 by the Jakhura family. The company is a leading player in the agro-industry in Malawi and specialises in exports of agricultural produce grown in Malawi, as well as provision of farm inputs.

Chairperson of Rab Processors Gaffar Jakhura told IPS that the company employs 1,500 people in Malawi and has an annual turnover of 80 million dollars. The Asian community in Malawi has made a considerable contribution to the economy of the country, especially those Indians involved in the trading and small-to-medium scale manufacturing sectors, according to Jakhura.

Another Indian company that has made its mark in the Malawi economy is Airtel, the country’s largest mobile network company, boasting 2,5 million subscribers. Close to 3,7 million of the country’s total population of 13,1 million use mobile phones.

Airtel founder and chairperson Sunil Bharti Mittal visited Malawi in March 2011 and assured Malawians that the company would be investing more in Malawi in the next year. From 2010 onwards, Airtel has put an initial investment of 100 million dollars into Malawi which will run over three years.

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