M'SIAN ENVOY IN NEW DELHI WORKING TOWARDS "AMBITIOUS" TRADE VOLUME TARGET WITH INDIA

By Manik Mehta

NEW DELHI, Aug 13 (Bernama) -- While Malaysia's ties with China have
progressed well in terms of trade and business, there is still a large and
untapped potential for business and trade with the other Asian giant, India.

New Delhi-based Malaysian High Commissioner to India Tan Seng Sung
says he is working towards forging closer ties with India and achieving an
"ambitious" trade volume target of US$50 billion.

Tan says there are no political issues with India.

Malaysia maintains a "warm and friendly relationship" that has historic
reasons including the colonial past of both countries under British occupation.

The influence of Indian culture and cuisine is ubiquitous in Malaysia.

"Our two-way trade volume with India was US$7.06 billion in 2009, down from
US$10.5 billion in 2008. The decline last year was the result of the general
global downturn in trade volume.

"But things are improving this year and we are working towards the target of
US$50 billion in 2015," he told Bernama in an interview at his office in the
Indian capital.

Prime Minister Najib Razak, who in January led a high-powered delegation to
India comprising nine ministers, a deputy minister, five chief ministers and
four parliamentarians, is very keen to intensify bilateral economic cooperation
with India.

He struck a good chemistry with Indian Prime Minister Manmohan Singh and
this was ubiquitous throughout Najib's visit.

Najib made it a point to also call on Tamil Nadu Chief Minister M.
Karunanidhi, thus becoming the first Malaysian prime minister to do so.

Najib's words that he wanted to "exponentially increase bilateral relations
with India", resonate well here.

Malaysia is also keen to attract investments from Indian companies in
Malaysia"s industry.

Tan said India's investment flow into Malaysia's manufacturing sector in
2009, based on approved investment applications, amounted to US$24.22 million,
while Malaysian investment flow into India touched US$67.6 million last year.

Trade and investment with India have become so important that the Malaysian
International Trade and Industry Minister Mustapa Mohamed has already twice
visited India this year.

Indeed, he is expected to visit India for the third time later this year.

Indian Prime Minister Manmohan Singh is expected to visit Malaysia in the
last quarter of this year.

Dates are being finalised in mutual consultations.

Bilateral ties could also get a big impetus from people-to-people contacts,
underlined by the growing interaction between Indian and Malaysian tourists
visiting each other's country.

People-to-people contacts, including through tourism from each other's
country, are also a key driver in fostering closer ties.

Some 520,000 Indian tourists visited Malaysia last year while this year
Malaysia expects some 600,000 visitors from India.

The launch of Air Asia flights to and from India would give a strong boost
to traffic to Malaysia," Tan said.

One of the drivers for increased trade with India is the Asean Free Trade
Agreement which would open up the gates for greater trade and also unleash the
market forces that would generate increased economic interaction.

Malaysia has also had six rounds of talks with Germany over the creation of
a Comprehensive Economic Cooperation Agreement (CECA) which, according to Tan,
would not be superfluous to the existing Asean-India FTA but would, in fact, be
an "Asean Plus".

Malaysia hopes that CECA can be finalised "very soon".

Tan said the high-profiled double-track Seremban-Gemas and project
epitomises intensifying corporate ties between the two countries.

Major Malaysian companies also maintain strong links with India.

Malaysia Airports Bhd has also been involved in the newly opened Delhi
International Airport's Terminal 3 which has received wide acclaim from aviation
circles.

Malaysia can also take advantage of India's infrastructure needs and can
engage in projects in which Malaysian companies have an edge over other
competitors.

Scomi, which bagged a prestigious monorail project in Mumbai, illustrates
the point.

India is also setting up low-cost housing projects for low-income Indians;
this is inherent with opportunities for Malaysian companies interested in
construction projects.

However, housing projects carry the baggage of shortage of land on which the
houses have to be built.

But there are also hindrances in India's import policy governing palm oil.

India prefers to buy crude palm oil and prefers to do palm oil processing
by itself.

But this is not going to be easy for the Indian side because, according to
Malaysian experts, the quality of Malaysian processed palm oil is considered to
be superior to the quality of Indian processed palm oil.
-- BERNAMA