INDIAN BUSINESS SOCIETY BULLLISH OVER CECA

By P.Vijian

NEW DELHI, Sept 3 (Bernama) -- As trade officials of India and Malaysia strive
to conclude the exclusive Comprehensive Economic Cooperation Agreement (CECA),
which would add a fillip to bilateral economic ties, the Indian business
community is already in a buoyant mood.

Leading Indian trade bodies are optimistic that the CECA could further open up
new business vistas between both trading allies and consider Malaysia a
strategic gateway into the 500-million consumer market in Asean.

"Indian businessmen have always been optimistic about Malaysia. The country has
friendly trade policies in place and the CECA will further allow Indian
exporters to explore the Malaysian market," A. Sakthivel, President of the
Federation of Indian Export Ogranisation told Bernama.

According to India's top trade organisation, the Confederation of Indian
Investors (CII), bilateral trade in 2008-2009 is tipped to reach a record level
of RM37 billion. (US$1=RM3.12)

Export growth nearly trebled from RM4.55 billion in 2006-2007 to RM11.9 billion
in 2008-2009. However, the growth of imports was more spectacular, expanding to
RM25.2 billion during this period.

At present, Malaysia is the 24th largest investor in India, with cumulative
investments of about RM17.5 billion recorded between 2000 and 2009.

"The potential for expanding relations between the two countries is yet to be
fully tapped given India's high requirements in infrastructure, construction,
management, electrical and electronics, which are the strength of the Malaysian
economy.

"India plans to spend US$1 trillion (RM3.5 trillion) in building power
plants,roads, highways, ports, airports, railways and communication networks in
the five years to 2016-17.

"This opens up huge opportunities for Malaysia not only in construction but also
in related services such as skill development, maintenance and management,"
added T.T Asok, CII Southern Region Deputy Chairman.

Currently, over 100 companies operate in Malaysia and in the first half of 2009,
Indian investments in Malaysia were RM60 million.

Between 1980 to 2009, cumulative Indian funds into Malaysia were RM7 billion, a
reflection that Indian investors are yet to fully exploit existing
opportunities.

Meanwhile, Malaysian companies have successfully established their
credentials in the Indian market, especially in the mega infrastructure sector where
companies like UEM Group Berhad, Scomi Group and IJM Corporation Berhad are
involved.

At the regional level, Dr Ram Upendra Das, a Senior Fellow, with the Research
and Information System for Developing Countries (RIS), an influential
Delhi-based think-thank, said Indian and Malaysian investors are yet to jointly
tap the robust Asean trade bloc.

"Malaysia and India bilateral ties are underutilised. While Asean is central to
the Look East Policy, the bilateral relations of both countries has not been a
determining force in Asean or the Asean Plus Three framework (China, Japan and
South Korea)," said Das, an expert in India-Malaysia trade.

The CECA, he added, would help reduce the existing gap in trade, services and
investments between both traditional trading partners and further act as a
catalyst for both economies.

"There is a large scope for engagement with the need to conclude the ongoing
CECA negotiations, as the total FDI (foreign direct investment) flows, between
India and Malaysia are below the potential level or miniscule.

"Indian investments in Malaysia are going to be crucial. Malaysians have taken
advantage of the unfolding scenario in the Indian investment market. But Indians
have waited and we need to push this further so that business, whether in trade,
services, goods or in investments to Malaysia increases," added Das.

In Delhi, this week, Malaysia and Indian trade negotiators are trying to hammer
down the CECA, so that it could be signed this November in Kuala Lumpur, during
the proposed visit of Indian Prime Minister Manmohan Singh.
--BERNAMA



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