The Hindu Business Line : EEPC plans to tap CIS markets

THE Engineering Export Promotion Council (EEPC) has formulated an "Integrated Market Access Plan" (IMAP) to tap the CIS (Commonwealth of Independent) States, which came into being after the disintegration of the USSR in 1991.

The plan, essentially to boost export efforts of the Indian engineering community, incorporates a market study, market awareness seminars, a wholly Indian engineering exhibition in one of the prospective (out of the 15) countries in CIS region as a trade exchange platform and lastly, a buyer-seller meet in India with invited procurement missions from the select 15 countries.

Talking to Business Line here recently, Mr C.S. Shukla, Executive Director of the council, said as part of the IMAP, the council has already prepared a comprehensive Field Market Survey of four countries within the CIS - - Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan, generally referred to as Central Asian Republics.

The main hindrances to trade with the region have been identified as distance, language barriers, inadequate transit facilities, inadequacy of data on business opportunities and lack of direct and regular interaction among the business entities.

While conceding that the market for engineering products was somewhat limited, the survey has pointed out that there was great potential in joint ventures/investment in manufacturing sector, as all states in the region have chalked out detailed disinvestments plans, under guidance from IMF/World Bank.

Recognising the next 5-year period as crucial for development, all major trading partners in CIS region are creating Free Trade Agreements (FTAs), but these FTAs alone, unaccompanied by capital and technology flows, may not usher in growth, it is pointed out.

The limited market for engineering products is mainly owing to negligible export capabilities, limited access to world markets and unsteady foreign exchange situation in the region.

The study visualises a major role for Indian industry, as the players in major economic activities in CIS such as agriculture, fruit/food processing, textiles (cotton, silk, wool), mining, oil& gas, automobiles are looking for technologies mainly in the SME sectors.

India's major trading partners in the CIS region are Russia, Ukraine, Kazakhstan, Uzbekistan, Kyrgyzstan and Belarus, accounting for more than 90 per cent of the trade. Mr Shukla said the Focus-CIS programme of the Government aims to change the present market scenario and increase market share in all the countries in the first phase.

All four countries, plus Turkmenistan, he said, had a rich mix of agricultural, mineral and fuel resources. The total area of the five is approximately 3.9 million sq. kms, stretching from Caspian Sea in the west to China in the east, and from Central Siberia in the north to Afghanistan, Iran and Pakistan in the south.

According to the council's detailed market analysis, the countries of Central Asia represent investment markets, where setting up of joint ventures could prove extremely rewarding. Mr Shukla pointed out that Indian industry, particularly the engineering sector, to derive maximum benefits, should adopt medium and long term strategies rather than a short term one. He described Belarus, Russian Federation and Ukraine as technically very advanced.

According to EEPC, all CIS countries are landlocked and remote from the world's trading hubs. The study has revealed that at the policy level, the countries are interested in projects aimed at developing cross-country transport links and reducing transit costs, at the policy level, but in practice the countries compete with each other in raising tariffs and tax barriers.

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