Prime Minister Narendra Modi?s first major diplomacy engagement will come next month when he joins Russian president Vladimir Putin, Chinese premier Xi Jinping, South African leader Jacob Zuma and Brazil president Dilma Rouseff at Brazil?s capital Brasilia for the BRICS summit.
He will also meet with 12 other leaders of the region, and would be holding bilateral talks with each of the two sets of leaders, apart from engaging them in discussions in groups.
The move seems to be similar to the previous NDA government under Atal Bihari Vajpayee, which pushed for relations with other regions including CIS countries and Africa. Modi?s government, too, is expected to boost trade and investment and the attempt is to attract more investment from Latin America.
On the sidelines of the forthcoming BRICS summit in Brasilia on July 16, Modi will have meetings with leaders of the Union of South American Nations (UNASUR) including Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, Guyana, Peru, Suriname, Uruguay, Paraguay and Venezuela.
UNASUR was launched in 2008 in Brasilia and unites the 12 countries of South America. In 2013, over 15% of India?s crude oil imports were from South America. India?s trade with the UNASUR twelve in 2013-14 was around $35 billion, and it is only growing. Indian companies are present in most of these countries, with extensive investments in hydrocarbons, industry, agriculture, and services, mainly IT.
Confirming the meeting of his country?s president Rafael Correa with Modi, Mentor Villagomez, ambassador of Ecuador, told FE, ?Agriculture and agro business is a sector where the two sides could work together. The possibilities of opening the markets both ways is the agenda. The potential in Indian companies setting up their bases in Ecuador could be a gateway to other countries in the region.?
?We can also provide processed marine food. Indian companies can invest in the oil sector, also the mining sector which is opening up; we discovered the biggest gold mine five years ago,? Villagomez added. In the defence sector, Ecuador became the first country in the region to buy the Indian-made Advanced Light Helicopter ?Dhruv? helicopters.
In the two-wheeler sector, Bajaj Company is looking at the option of setting up a manufacturing plant in Ecuador. Interestingly, Prabhat Kumar, Indian ambassador to Colombia, has indicated that an Indian auto company is in discussions with the local government to set up their plant in that country. According to former ambassador to the region Deepak Bhojwani, ?Brazil is India?s principal and strategic partner in Latin America. The prime minister will find a positive political environment, alternative sources of energy, a market of 500 million, with average annual per capita income well over $10,000, and a relatively stable investment environment. First-hand encounters with the regional leaders will focus attention on the economic potential, and beyond that, consolidate our political relations.?
?There have been relatively few visits by our heads of state or government to this region, which has massive reserves of energy, minerals and other endowments which complement our economy,? Bhojwani added.
Until now, one of the reasons international companies have been reluctant to invest in India is the country?s huge bureaucratic obstacles to doing business. However, Modi has vowed to radically change this.
In the World Bank?s ranking of ?ease of doing business? in 189 countries around the world, India ranks 134th. It takes 35 legal procedures to obtain a construction permit in India.
