Trade between Mozambique and India reaches 1.7 million and may grow more
Mozambique and India reached about 1.7 million euros in trade in 2018, up from 1.5 million in the previous year, and there is room for growth, told the outgoing ambassador of India to Mozambique.
“Mozambique continues to be a major destination for Indian investment in Africa and our intention is to increase this partnership,” said Rudra Gaurav Shresth, who is officially appointed a high commissioner.
Coal, cashew nuts and beans are among the top products India buys from Mozambique, but the two countries should seek to diversify the basket, the diplomat said.
“These products are very important, but we must diversify so that we can protect ourselves from possible price variations in the international market,” he said.
To ensure diversification, he added, the Indian government has eliminated fees for products from Mozambique, with the exception of alcoholic beverages and tobacco.
“This project has helped Mozambique increase the level of product exports to India,” said Rudra Gaurav Shresth, in response to concerns from Mozambican producers.
In 2018, India recorded an overproduction of ‘pigeon pea’, known in Mozambique as ‘boer’ beans, one of the main products that the country lusófono exports to that Asian country – in the light of an agreement signed during the visit of the Indian prime minister , Narendra Modi, to Maputo, in 2016.
Excess production in India, the only international market for this Mozambican agricultural product, caused a price drop of more than 50%.
The situation has led to the loss of purchasing power of many Mozambican farmers, triggering an economic crisis among farmers, especially in the provinces of Nampula in the north of the country, and Zambezia in the centre, according to a study by the British NGO International Growth Center.
Rudra Gaurav Shresth explained that the situation is normalized, advancing that in 2018, Mozambique exported close to 150 tonnes to India, against 125 tonnes in the previous year.
“It’s true that there was overproduction and India had to stop buying the product, but that did not happen in the case of Mozambique because we have an agreement,” he added.
In addition to beans, coal is one of India’s main interests in Mozambique, which exported about 1.5 million tonnes to that country last year.
“Despite the reduction in prices on the international market, coal continues to be of interest to us. We expect to double this amount until next year,” he said, adding that it is ” quality coal and very important in India”.
At the time of balance, leaving Maputo, the diplomat sees with optimism the relationship between the two countries, linked by the Indian.
“Mozambique has made much progress,” he said.
For Rudra Gaurav Shresth, “there are many things that can be done at the level of cooperation.”
The diplomat considered that there is still “a lot of lack of knowledge about Mozambique in India at the corporate level, but the intention is to improve this relationship more and more.”
India dethroned South Africa as the main destination for Mozambique’s exports, according to the 2017 yearbook of the Mozambican National Statistics Institute (INE).
India was the target of 34.3% of the value of exports, ie worth $ 1.6 billion, almost double the sales to South Africa, which was first in the yearbook of 2016 and became the second country in the list.
Regarding imports from Mozambique, India was in fifth place, with 7.8% of purchases abroad, ahead of France (4.4%) and Portugal (4.2%).