Bilateral trade between South Africa and India increased by 135% between 2007/2008 and 2011/2012, while Indian companies have invested $328.25-million in this country over the past five years. So reported Overseas Indian Facilitation Centre CEO Sujata Sudarshan in Johannesburg on Thursday.
"You all know how much South Africa was networked into Europe and the Western world. But times are changing," highlighted Indian High Commissioner to South Africa Virendra Gupta. Emerging countries are now playing a greater role in the global economy. "There is a very rapidly growing economic and commercial relationship [between the two countries]. Hardly a week passes by without us hearing about a new investment decision, either by a South African company in India or an Indian company in South Africa. The relationship has not reached a plateau."
Frontier Advisory director and head of India Abdullah Verachia pointed out that there are now 110 substantial Indian companies doing business in South Africa. He added that India was forecast to be the world's fastest-growing economy over the period 2006 to 2020. The country was already Asia's third-largest economy (fourth largest in purchasing power parity terms). In terms of incoming foreign direct investment, India ranked second in Asia, after China.
"What's driving the growth of India? The significant increase in foreign investment into India. Increased domestic consumer spending. Global opportunities for Indian corporates [the development of Indian multinationals]. In South Africa, Indian companies have become household names," he explained.
Economic reforms have resulted in a big increase in the size of the Indian middle class. "It's unprecedented," enthused Verachia. "India will be a winner because of democracy, sustainability and the demographic dividend [young population, younger than China's]. The [Indian] economy continues to grow because of the spirit of entrepreneurship found in many parts of the country."
South Africa currently ranks number two in the list of African exporters to India. Nigeria is in first place, and Angola is third. In fourth lies the Republic of Congo (that is, Congo-Brazzaville) while fifth place is taken by Tanzania. Whereas African/India trade totalled $1-billion in 2008, in 2008 it amounted to $42.8-billion.
Sudarshan, Gupta and Verachia were all speaking during a seminar on the "Role of the Indian diaspora in deepening economic and commercial ties with India" at the University of Pretoria's Gordon Institute of Business Science, in Johannesburg, on Thursday.