STRENGTHENING TRADE, INVESTMENT COOPERATION WITH INDIA by Fardah

Jakarta, Dec 14, 2016 (Antara) - President Joko Widodo (Jokowi) paid a state visit to India in the last month of 2016 to boost bilateral trade and invite Indian businessmen to invest more in Indonesia.

          India is Indonesia's largest trade partner in South Asia and fourth largest trade partner in the world, with a trade balance reaching US$14.6 billion, or 4.9 percent of Indonesia's total trade value in 2015.

        In the same year, India invested in 43 projects worth $15.5 million in Indonesia, an increase from the $12.89 million it invested in 2014. India mostly invests in the food, textiles, and transportation sectors.

         Indonesia has enjoyed a large trade surplus with India and continues to boost bilateral trade ties, particularly by diversifying products and commodities exported to India.

         Foreign Affairs Minister Retno LP Marsudi said, in addition to CPO and coal, which are Indonesia's main exports to India, Indonesia should be able to export other products to the South Asian nation, such as furniture, gambier, and areca nuts.

         During the two-day visit (Dec 12-13), the president explored the possibility of diversifying exports.   
    The first visit of President Jokowi to India is intended to reciprocate the visit of the Indian prime minister to Jakarta in 2013 and the visit of the Indian vice president to Indonesia in November 2015.  

   Among the members of the presidential entourage were First Lady Iriana Jokowi, Coordinating Minister for Economic Affairs Darmin Nasution, Minister/State Secretary Pratikno, Minister of Foreign Affairs Retno Marsudi, Minister of Trade Enggartiasto Lukita, Minister of Industry Airlangga Hartarto, and Head of the Indonesian Investment Coordinating Board (BKPM) Thomas Lembong.

        President Jokowi held bilateral meetings with the prime minister of India, the president of India, and the vice president of India and attended a conference call meeting with 20 CEOs of major Indian companies.

        Jokowi and Modi witnessed the signing of memoranda of understanding (MoUs) for cooperation in trade standardization; youth affairs and sports; and the eradication of illegal, unreported, and unregulated fishing.

        The Indonesian leader lauded the signing of an MoU on trade standardization, aimed to boost bilateral trade and support economic cooperation, as well as people to people contact.

        India is an important partner of Indonesia, and the bilateral ties in the political, economic, and socio-cultural fields between the two countries have been strengthening over time, according to Jokowi.

        "At today's meeting, we discussed comprehensively our efforts to step up economic cooperation," he noted.

        In the investment field, President Jokowi invited Indian businessmen to invest in the pharmaceutical industry and in the information technology and automotive sectors in Indonesia.

        "Indonesia invites India to step up investment cooperation in the pharmaceutical, information technology, and automotive fields," the Indonesian head of state said in a joint press statement issued following a bilateral meeting with Indian Prime Minister Narendra Modi at Hyderabad House on Dec 12.

        Indonesia considered cooperation in pharmaceutical raw materials with India a priority, Foreign Affairs Minister Marsudi said.

        So far, Indonesia has imported various pharmaceutical raw materials from India.

        "But, we are currently encouraging India to invest in pharmaceutical raw materials in Indonesia," she added.

         Some Indian pharmaceutical companies have pledged to invest in building a raw materials manufacturing plant in Indonesia, worth $135 million, in two stages.

           The pledge was made during Jokowi's meeting with 20 CEOs of Indian firms on Dec 13.

            "In the pharmaceutical sector, some firms will build a raw materials factory, with an initial investment of $35 million in the first phase and $100 million in the second phase," BKPM Head Lembong said.

            He pointed out that the investment would be made under a collaborative scheme. "It would not be a one direction (investment) from India; rather, we will also invest in India."
  Lembong said the industry would have to take into account issues related to intellectual rights for certain drug formulas, adding that the cooperation would allow the country to obtain cheaper raw materials for drugs.

         Besides this, India will send a pharmaceutical team to Indonesia to study the possibility of investing in the industry to produce basic pharmaceutical materials in Indonesia.

         Industry Minister Hartarto said foreign investors were allowed to wholly own projects to produce pharmaceutical active ingredients.

       He said India wanted a simplification of the licensing procedure used by the Indonesian Food and Drug Supervision Body.

          At the meeting with the Indian CEOs, Jokowi was accompanied by several CEOs of Indonesian corporations: Abraham Mose from PT Pindad, Sudhamek AWS from Garuda Food, Erwin Aksa from Bosowa Group, Fuganto Widjaja from Sinar Mas Group, and Chairman of the Indonesian Chamber of Commerce Rosan Roeslani, as well as his Vice Chairman Shinta Kamdani.

          The president then invited the Indian CEOs to explore business opportunities in Indonesia by offering them simple, easy processes.

         "Let me know what my ministers and I can do to help you bring your business plans to life in Indonesia," he remarked.

        In addition, Indonesia is also eager to establish cooperation with India in forming a digital economy and supporting e-commerce.

            "Indonesia is seeking opportunities to cooperate with India in the digital economy and e-commerce space. The digital economy and e-commerce in India is considered to be highly prospective," BKPM Head Lembong stated.

          Lembong noted that India and Indonesia are experiencing a period of digital economic growth.

            "There are digital companies growing in both countries. In Indonesia, we have heard of Tokopedia, Traveloka, and Gojek. Such digital companies are also growing in India," he remarked.

        He claimed that several Indonesian e-commerce players use programmer and coding services from India.

        In the meantime, Modi raised the issue of tourism cooperation possibilities and opportunities for Indonesia to cooperate in the Bollywood film industry.

        Coinciding with the visit, Indonesian flag carrier Garuda Indonesia began operating a Jakarta-Mumbai direct flight.

        "I am pleased to announce that Garuda Indonesia, starting today, will fly directly to Mumbai from Jakarta," Jokowi announced at a joint press conference with Modi on Dec 12.

         The direct flight connecting the two metropolitan cities will help boost the number of Indian tourists to Indonesia, strengthen bilateral cooperation between the two countries, and support economic cooperation as well as people-to-people contact, the president said.

        In 2015, Indonesia received 267,082 Indian tourists, an increase of 28 percent from the 231,266 people recorded in the previous year.

       This year, Indonesia has achieved its target of attracting at least 350 thousand Indian tourists. During the first semester of this year, a total of 185,911 Indian tourists visited Indonesia. ***3***
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(T.F001/A/BESSR/F. Assegaf) 14-12-2016