Seeking fresh trade winds
Comment by Wong SulongIncredible India! The slogan of the Indian Tourism Commission greets visitors at all entry points.
Incredible indeed! From the shanties and slums of Delhi to the slick, westernised IT research laboratories in Bangalore, the razzmatazz of Bollywood to the eternal beauty of Taj Mahal at Agra, India is a kaleidoscope of contrasts and contradictions.
When he proclaimed India's independence in August 1947, Jawaharlal Nehru, the nation's first prime minister, spoke of an ancient land making its tryst with destiny.
Now nearly 60 years on, the world is asking: Is it India's destiny to be an economic superpower in the 21st century? Or will the world's largest democracy, with 1.2 billion people of diverse ethnic, linguistic and religious backgrounds, prove impossible to galvanise and be consigned to be a union of the impoverished?
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MEETING OF MINDS: Abdullah who is on a five-day visit to India having a light discuccion with Gandhi at the official residence on Tuesday.- Bernamapic |
Even now, India has a middle class of 300 million people. That's more than the entire population of Indonesia.
China and India – ever keen competitors – present contrasting experiences in economic development.
China began its path of economic reforms in 1978 with the ascendancy of Deng Xiaoping. India embarked on its economic liberalisation about 15 years later under the late Rajiv Gandhi (husband of Sonia Gandhi, the current president of the ruling Congress Party.)
While China chose manufacturing and exports as its engines of growth, India decided to go for ICT and knowledge-based industries, capitalising on the vast pool of engineering and English-speaking graduates.
The strategies of the two Asian giants are working.
Malaysia has already plugged into the Chinese economic grid. Now it's time to do the same with India.
This is the primary reason Datuk Seri Abdullah Ahmad Badawi chose to round up his foreign engagements for 2004 with a high profile and significant visit to India.
Abdullah wants to break new ground in Malaysia-India ties, which while cordial and friendly in the past, have nevertheless slipped into a state of benign neglect in recent years.
Malaysia-India trade has grown from US$467mil (RM1.77bil) in 1994 to US$3.2bil (RM12.2bil) last year. But imports from Malaysia represent only 3.4% of Indian imports and imports from India represent a mere 0.8% of total Malaysian imports.
Also, the trade has been dominated by commodities: Malaysia selling crude petroleum and palm oil to India and buying cereals, vegetables and fruits in return.
“While the Malaysia-India record is good, it is not good enough. We need to pay fresh attention to how and what we trade with each other,” Abdullah told a business forum in New Delhi at the start of his visit.
He wants to forge new economic and commercial ties in the fields of technology and services.
The 12 Memoranda of Understanding signed during his visit are a reflection of the focus of this expanded relationship.
A reason for optimism is the chemistry of the two prime ministers. Abdullah and Manmohan Singh have a lot in common. Both have a civil service background; both have recently been elected prime minister and both are about the same age (Pak Lah being a year older.) They represent a new generation of leaders in post-independence Malaysia and India.
Abdullah's proposal for a bilateral free trade agreement was expanded by the Indian prime minister in the form of a comprehensive economic partnership, which Abdullah hopes could be signed when Manmohan Singh reciprocates with a visit to Kuala Lumpur.
While there are definitely huge opportunities for Malaysian businesses in India, one must also recognise that the road ahead is not going to be smooth. The Indian bureaucracy remains a formidable obstacle for Malaysian businesses accustomed to the Malaysia Boleh spirit.
Malaysian companies have mastered the expertise of BOT (build, operate, transfer) in roads, ports, airports and power plants. But some Indian political leaders are still unable to reconcile with the principle that once contracts are given out, they have to be honoured irrespective of whatever party comes to power.
While welcoming the fresh impetus from Malaysia to forge new ties, Indian businesses are still sore with the Malaysian Government's decision to defer the multi-billion ringgit double-tracking rail project. The Indian Government itself is more sanguine, expressing understanding after Abdullah had explained the reasons for the deferment.
There are other matters that India would like Malaysia to support – faster visas for Indians, New Delhi's push for a permanent seat at the UN security council and India's interest in the proposed East Asia Community.
The first issue is being addressed; the second and third require more dialogue in the context of forthcoming developments.
India and Malaysia need to work hard on their relationship. The scenario is positive.
There is a converging of their respective national interests and Abdullah's visit has laid the groundwork for the convergence to be solidified into a new strategic partnership.
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