Indian engineering exposition closes with high expectations
The Jakarta Post, Jakarta
Ranging from aluminum home appliances to three-wheeler vehicles, the Indian engineering expo Indiatech 2005 here was a showcase of the country's manufacturing industry.
Organized by the Engineering Export Promotion Council (EEPC) of India at the Jakarta Convention Center, the four-day exhibition ended on Saturday, booking about US$5 million in business inquiries between firms from both countries.
"There have been confirmed contracts of $487,000 during the exhibition with automotive components, sewing machines and X-ray machines as majority products," said EEPC chairman Rakesh Shah after the closing of the event.
In addition to the confirmed deals, there were several other inquiries, he added.
Aside from the trade during the expo, several Indian companies had previously reported new investments in Indonesia. Two of the companies were automotive companies Bajaj Auto Ltd. and TVS Motor Co., with one major Indian public company IRCON currently executing a road construction project in Indonesia.
According to the Investment Coordinating Board (BKPM), Indian foreign direct investment (FDI) approval reached $66.7 million last year. Meanwhile, two-way trade between the two countries increased from $2.4 billion in 2003 to $2.91 billion in the first 11 months last year.
However, it is the India's engineering export to Indonesia in particular that has been the most impressive in recent years. Last year, it grew by more than 30 percent, thanks in part to the rapid growth of India's engineering sector in terms of value -- from $3.761 billion in 1995/1996 to $10.7 billion in 2003/2004.
"The growth has been enormous, especially compared to only $10 million worth of engineering exports in the 1950s," Shah said.
The extensive growth is partly be attributable to the support provided by the Indian government, notably in empowering and developing SMEs operating in the manufacturing sector through various forms of incentives.
Besides providing direct subsidies, the Indian government also provides exemption for certain excise duties for an establishment with a turnover of up to 10 million rupees ($215,285) while also setting up several industrial zones for certain export -and import- bound products.
The closing of the exhibition, Shah forecasts, should pave the way for stronger investment and trade cooperation between the region's giants.
"I do not expect anything big to happen in the next six months but by three years, you'll find India as your major trading partner," Shah said. (003/004)