Mridu Kumari
Though, it has to face huge Chinese challenge there, India need to tap South American market, if it is serious to pare economic losses due to slowdown in first world
In the past 14 months, Prime Minister Narendra Modi has undertaken visits of 24 countries, including Brazil, a lone Latin American nation where he had gone to attend the 2014 BRICS summit. On the sidelines of the 6th BRICS summit, though, Modi had held meetings with leaders of a dozen South American nations, yet he has hardly made serious diplomatic overtures with these nations of the region whose landmass is five times that of India and combined GDP is $5.5 trillion. In 2013, Latin American countries received $179 billion of FDI, the highest record for any region in the world.
What can explain the cavalier outlook of New Delhi towards the South American nations than this that the task to give momentum to bilateral engagement with this region has been left to junior ministers like Gen (Rtd) V K Singh and Dharmendra Pradhan. External Affairs Minister Sushma Swaraj has not ever visited these countries, except for holding a meeting with her counterparts from Cuba, Costa Rica, Ecuador and Antigua &Barbuda on the siddlines of the UN General Assembly in September last year.
In comparison, China has built up a robust and mutually benefiting relationship with all 33-members of Community of Latin American and Caribbean States (CELAC). Early this year it organized the first ministerial level meeting of CELAC members. By 2025, China has decided to increase direct investment to $250 billion in Latin America; it has also pledged to double the trade from $261 billion to $500 billion in a decade. It would all help China cement its position in the region as the second-largest trading partner after the US whose annual trade with Latin America stands at above $900 billion. In an attempt to enlarge Chinese footprint in Latin America, President Xi Jinping, after attending the BRICS summit in Brazil, undertook a visit to Argentina, Venezuela and Cuba. Starting from BRICS summit to his Latin American countries’ visit, the Chinese President gave three major policy speeches, provided lengthy written interviews to regional media, attended more than 70 multilateral and bilateral events, and met more than 20 heads of state or government. Also, he signed over 150 MoUs and framework agreements with Brazil, Argentina, Venezuela and Cuba. Involving over $70 billion worth of investments, these agreements covered areas such as energy, mining, electric power, agriculture, science and technology, infrastructure and finance.
High profile visit of the Chinese President to Latin America was followed by Prime Minister Li Keqiang’s official trip to Brazil, Colombia, Peru and Chile in May this year. China has pledged to invest $103 billion worth of investment for improvement of Brazilian infrastructure. China which earlier signed $3.5 billion deal for development of the Brazilian energy sector, agreed to finance $7 billion for this Latin American country’s state-owned oil firm Petrobras during Premier Li Keqiang’s visit. Its largesse also included development of railway, mining, power and equipment manufacturing sector. China is the 12th largest investor in Brazil. In keeping with its South American strategy, China is not only pumping in money but also enlarging its cultural ambience across the Western hemisphere. It is beaming radio and television programme in local official languages of the Latin American nations. Then, over the past few years, China has opened 32 Confucius Institutes all over Latin America. It is said that even hotels in Latin American countries remain prepared for an increasing number of Chinese tourists’ visit; they are served Chinese menus too. China and Latin American countries’ relations are developing unobtrusively fast.
In contrast, India which is already slow in positioning itself on the high turf of diplomatic engagement with the countries of the region, has not yet given pace to economic relations with Latin American and Caribbean countries. The two-way trade which was $2 billion in 2000 has grown to only $46 billion in 2013-14. India’s investment in South America is also unimpressive: till last year it was around $20 billion. To maximize economic engagement, India held its first India-Latin America and Caribbean states’ conclave in October last year. It was attended by 23 countries of the region.
Experts say unlike China which has surplus money, India does not have capital enough to pour in billions of dollars in infrastructure and other developmental sectors of the region; instead, New Delhi-like in Africa-is taking the human resource route by upgrading skills and imparting technological education to the people of Latin American nations. It is setting up IT centres. In Peru, Ecuador and Guyana, IT centres have begun to function. It has also set up vocational training institutes in Jamaica and Belize. Under Technical and Economic Cooperation programme, it is already providing scholarship to 200 Caribbean students. Then for the capacity building purposes, India offered Guatemala several assistances. It offered to establish a regional Barefoot Vocational Training Centre for Central American Integration System (SICA) member countries in Guatemala. While all this is done within the ambit of South-South cooperation, India has tried to increase trade and commerce with SICA members Guatemala, Belize, Costa Rica, El Salvador, Honduras, Nicaragua and Panama to push its economic engagement with the regional block with which New Delhi established linkage in 2004. In 2014, the two-way trade was $1.4 billion. At the recent ministerial level meeting between India (represented by Minister of State for External Affairs Gen(Rtd) V K Singh) and SICA countries in Guatemala, both sides agreed to hold meeting of the India-SICA Business Forum as soon as possible to encourage trade and investments between the two sides. To promote peace and democracy in the world, India participated in the just concluded 8th Ministerial Conference in San Salvador, national capital of El Salvador.
Then with the region’s another notable block, 15-member Caribbean Community (CARICOM) India’s bilateral trade is mediocre. Engagement with the block that comprises former British colonies like Antigua&Barbuda, Bahamas, Barbados, Belize, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, St. Kitts and Nevis, St. Lucia, St. Vincent and Grenadines, Suriname, Trinidad &Tobago-began in the early 2000. Yet the two-way trade is only $1 billion. At the first ever CARICOM-India Joint Commission meet in Georgetown in Guyana, New Delhi admitted that there is much scope for growth of bilateral trade. But it is surprising that India despite having deep rooted ethnic ties and good cricketing relations with many countries of CARICOM which play under the banner of West Indies, failed to give its bilateral ties a significant push. Such omissions in diplomatic initiative in Latin American and Caribbean countries may put India on the spot, given that 20 per cent of its oil resources are imported from the region.
What can explain the cavalier outlook of New Delhi towards the South American nations than this that the task to give momentum to bilateral engagement with this region has been left to junior ministers like Gen (Rtd) V K Singh and Dharmendra Pradhan. External Affairs Minister Sushma Swaraj has not ever visited these countries, except for holding a meeting with her counterparts from Cuba, Costa Rica, Ecuador and Antigua &Barbuda on the siddlines of the UN General Assembly in September last year.
In comparison, China has built up a robust and mutually benefiting relationship with all 33-members of Community of Latin American and Caribbean States (CELAC). Early this year it organized the first ministerial level meeting of CELAC members. By 2025, China has decided to increase direct investment to $250 billion in Latin America; it has also pledged to double the trade from $261 billion to $500 billion in a decade. It would all help China cement its position in the region as the second-largest trading partner after the US whose annual trade with Latin America stands at above $900 billion. In an attempt to enlarge Chinese footprint in Latin America, President Xi Jinping, after attending the BRICS summit in Brazil, undertook a visit to Argentina, Venezuela and Cuba. Starting from BRICS summit to his Latin American countries’ visit, the Chinese President gave three major policy speeches, provided lengthy written interviews to regional media, attended more than 70 multilateral and bilateral events, and met more than 20 heads of state or government. Also, he signed over 150 MoUs and framework agreements with Brazil, Argentina, Venezuela and Cuba. Involving over $70 billion worth of investments, these agreements covered areas such as energy, mining, electric power, agriculture, science and technology, infrastructure and finance.
High profile visit of the Chinese President to Latin America was followed by Prime Minister Li Keqiang’s official trip to Brazil, Colombia, Peru and Chile in May this year. China has pledged to invest $103 billion worth of investment for improvement of Brazilian infrastructure. China which earlier signed $3.5 billion deal for development of the Brazilian energy sector, agreed to finance $7 billion for this Latin American country’s state-owned oil firm Petrobras during Premier Li Keqiang’s visit. Its largesse also included development of railway, mining, power and equipment manufacturing sector. China is the 12th largest investor in Brazil. In keeping with its South American strategy, China is not only pumping in money but also enlarging its cultural ambience across the Western hemisphere. It is beaming radio and television programme in local official languages of the Latin American nations. Then, over the past few years, China has opened 32 Confucius Institutes all over Latin America. It is said that even hotels in Latin American countries remain prepared for an increasing number of Chinese tourists’ visit; they are served Chinese menus too. China and Latin American countries’ relations are developing unobtrusively fast.
In contrast, India which is already slow in positioning itself on the high turf of diplomatic engagement with the countries of the region, has not yet given pace to economic relations with Latin American and Caribbean countries. The two-way trade which was $2 billion in 2000 has grown to only $46 billion in 2013-14. India’s investment in South America is also unimpressive: till last year it was around $20 billion. To maximize economic engagement, India held its first India-Latin America and Caribbean states’ conclave in October last year. It was attended by 23 countries of the region.
Experts say unlike China which has surplus money, India does not have capital enough to pour in billions of dollars in infrastructure and other developmental sectors of the region; instead, New Delhi-like in Africa-is taking the human resource route by upgrading skills and imparting technological education to the people of Latin American nations. It is setting up IT centres. In Peru, Ecuador and Guyana, IT centres have begun to function. It has also set up vocational training institutes in Jamaica and Belize. Under Technical and Economic Cooperation programme, it is already providing scholarship to 200 Caribbean students. Then for the capacity building purposes, India offered Guatemala several assistances. It offered to establish a regional Barefoot Vocational Training Centre for Central American Integration System (SICA) member countries in Guatemala. While all this is done within the ambit of South-South cooperation, India has tried to increase trade and commerce with SICA members Guatemala, Belize, Costa Rica, El Salvador, Honduras, Nicaragua and Panama to push its economic engagement with the regional block with which New Delhi established linkage in 2004. In 2014, the two-way trade was $1.4 billion. At the recent ministerial level meeting between India (represented by Minister of State for External Affairs Gen(Rtd) V K Singh) and SICA countries in Guatemala, both sides agreed to hold meeting of the India-SICA Business Forum as soon as possible to encourage trade and investments between the two sides. To promote peace and democracy in the world, India participated in the just concluded 8th Ministerial Conference in San Salvador, national capital of El Salvador.
Then with the region’s another notable block, 15-member Caribbean Community (CARICOM) India’s bilateral trade is mediocre. Engagement with the block that comprises former British colonies like Antigua&Barbuda, Bahamas, Barbados, Belize, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, St. Kitts and Nevis, St. Lucia, St. Vincent and Grenadines, Suriname, Trinidad &Tobago-began in the early 2000. Yet the two-way trade is only $1 billion. At the first ever CARICOM-India Joint Commission meet in Georgetown in Guyana, New Delhi admitted that there is much scope for growth of bilateral trade. But it is surprising that India despite having deep rooted ethnic ties and good cricketing relations with many countries of CARICOM which play under the banner of West Indies, failed to give its bilateral ties a significant push. Such omissions in diplomatic initiative in Latin American and Caribbean countries may put India on the spot, given that 20 per cent of its oil resources are imported from the region.
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