RI-India trade expected to reach US$4b by 2000

JAKARTA (JP): Indonesia and India aim to quadruple their two- way trade to US$4 billion per annum by the end of this century, from a current level of less than $1 billion.

Indian Ambassador to Indonesia S.T. Devare told a business luncheon attended by Indian and Indonesia-based Indian businessmen that the trade target has been initiated by Coordinating Minister for Production and Distribution Hartarto.

"During a meeting with Indian businessmen ... Mr. Hartarto set the target for bilateral trade at $4 billion by the end of the century," Devare said.

"This opens up unlimited possibilities, because trade and economic volume between the two is now far from satisfactory, considering the great potential and opportunities of both countries," he added.

The luncheon was organized by the Economic Association of Indonesia and India, together with a 20-member delegation of Indian businessmen from the IndusInd Group.

Devare noted that India's deregulatory policies and economic reforms in the last four or five years will act as an incentive for Indonesian businessmen to invest in that country.

India expects to gain $10 billion in foreign investments this year, he said.

The Indian delegation, headed by Srichand P. Hinduja of the London-based Hinduja Group, is on a two-week tour of Southeast Asia, and will be leaving for Singapore later this week.

Hinduja said yesterday that India was currently exploring Indonesia's market and business prospects, which were still considered vast in comparison to those of Singapore and Malaysia.

"Singapore and Malaysia are already saturated," he told reporters.

The Hinduja Group has clinched a deal with PT Multi Eka Karma, making the latter its strategic partner in developing investment projects in Indonesia.

Under the agreement, Multi Eka Karma-- the investment holding company of the General Sudirman Foundation of the Armed Forces-- will act as the catalyst for Hinduja to facilitate its investments in Indonesia's resources. Meanwhile, Hinduja will serve as the catalyst for Multi Eka to gain an international competitive edge.

According to the Central Bureau of Statistics, Indonesia and India currently have a trade balance of more than $850 million, with a deficit of about $100 million on the Indonesia side.

Indonesia's exports to India dropped by 5 percent to $39.15 million last December, from $41.19 million in the same month during 1994. Its imports from that country soared by 104.3 percent to $71.33 million, from $34.92 million.

For the January-December period of 1995, Indonesia's exports to India rose by 37.2 percent to $381.03 million, from $277.75 million in 1994. Its imports from that country increased by 50 percent to $478.81 million, from $318.27 million. (pwn)