CAIRO: On their paths to growth, Egypt and India face similar development challenges that revolve around eradicating poverty and illiteracy while sustaining their impressive GDP levels, said India’s ambassador to Egypt on Sunday.
“Estimates show that in the last decade, India reduced poverty by 8 percent, which is a significant achievement, but it doesn’t mean that we should be complacent, said Ambassador A. Gopinathan. “Similarly to Egypt, India has a huge population growth. The challenges of poverty and unemployment become a very prompt task.
Another common challenge the two countries share, he pointed out, is how to target subsidies to ensure they reach the needy. While the subsidies issue remains sticky in Egypt, India has outlined three mechanisms to handle the subject.
“In India, we have ration shops where basic commodities such as rice, cooking oil and sugar are sold cheaply, he said.
The Indian government also buys wheat and rice crops from farmers and re-sells them at subsidized prices. “The government also subsidizes prices of fertilizers and agricultural imports as well as water and electricity for farmers.
The ambassador’s remarks were made on the occasion marking the 58th anniversary of the Republic Day of India, a country that currently enjoys a GDP of 8-10 percent. “This growth level gives us more resources to work towards healthcare, education and so on. We hope the task becomes easier and easier as we continue to grow and have more resources.
India is already the 12th largest foreign investor in Egypt, and has huge ventures in the pipeline in the oil, petrochemicals, steel and IT sectors. Quite recently, the country organized its “Made in India Show for the first time in Egypt, bringing around 120 business people under one roof.
Indian investments in Egypt have nearly doubled from $400 million to $750 million in the last two years. “With current proposals in the pipeline, we will have about $2 billion in investment by the year 2008/09, the ambassador said.
Indian investments flow in around 40 projects, including Alexandria Carbon Black, Asian Paints, Oberoi Group, Reliance Industries, Satyam Computers Limited and Alexandria Fibre Co.
India’s biggest investment in Egypt so far comes from a joint venture between IFFCO of India and Al Nasr Mining Company of Egypt to establish a Phosphoric Acid plant in Upper Egypt, entailing an investment of more than $350 million, 76 percent of which will be made by the Indian partner.
Hindu-Egyptian trade ties have also been on the rise. Bilateral trade amounted to $1.97 billion in the 2006/07 fiscal year, up from $628 million in 2004/05.
India has now become Egypt’s third largest trading partner, after the US and Italy, and the largest importer of Egyptian products. India’s exports to Egypt crossed $420 million; while Egypt’s exports to India, mainly oil and gas, reached $1.53 billion.
According to embassy records, Indian exports to Egypt include machinery, textile fibers, plastic and rubber, pharmaceuticals, tea and tobacco. Egyptian exports, on the other hand, are mainly oil and gas – which constitute around 95 percent – followed by raw cotton, rock phosphate and marble.
