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India Mulling Sweeping Trade Pact With Africa


India is considering lifting certain trade duties with African countries. The move is aimed at countering China's increasing business ventures in the resource-rich continent. VOA's Steve Herman reports from New Delhi.

Government and industry sources here say India is planning to announce a major trade and investment plan when it hosts an unprecedented summit with African countries in early April.

Under consideration: duty free imports of some items from Africa. The plan is being prepared at a time when China has been edging out India for some lucrative African contracts. Beijing and New Delhi are in competition for resources abroad to meet the energy needs of their rapidly growing economies.

Some trade policy makers here are talking about sweeping concessions on duties for African products but key Indian industry figures are calling for a more selective approach.

The deputy director of the Confederation of Indian Industry, Shipra Tripathi, says relaxation of duties and quotas should be limited to sectors mature enough to handle such a change.

"Probably gems and jewelry or the traditional sectors that we've had in terms of industry," she said. "They're already entrenched. They have active players in those fields who have a global presence and a global reputation. If we were to look at having a free trade agreement in terms of textiles we will kill the textile industry, whatever exists in African countries."

The African Union has selected 14 member countries that will send heads of state to New Delhi this April for the first-ever India-Africa Forum.

The event is seen as a reaction to a summit in November 2006 when Beijing hosted nearly 50 African leaders. That meeting resulted in China pledging to double aid to Africa and announcing billions of dollars in credit lines and commercial deals.

Indian government officials and industry leaders say their interest in Africa is not only economic.

CII's Tripathi says India must demonstrate that it is truly concerned with building an equitable partnership and empowering Africans.

"India industry should not be looked upon as colonizers or someone who is moving in to take away," she said. "They would rather be looked upon as people who would contribute."

Indian exports to Africa are growing rapidly with two-way trade now at about $20 billion a year. South Africa and Nigeria lead the way.

India polishes nearly all of South Africa's diamonds and is a major importer of gold. India exports to that country fabric, yarn, auto parts, and machinery, especially agricultural equipment.

Nigeria provides 10 percent of India's petroleum needs.

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