Destination Madagascar

Written by: Jozef de Coster

Jozef de Coster (know more)

Madagascar expects the country's textiles and apparel industry to create 200,000 supplementary jobs in the next five years. The African country is among few in the world that has been seeing an acceleration in both textile imports as well as apparel exports. This is a country that has had cultural and trade ties with India since the early fourth century, and with the Indian government opening a $10 billion line of credit over the next five years for Indian companies wishing to invest in Africa, it is a land that beckons, Jozef De Coster, reports from Antananarivo.

 

While global textile trade continues growing at a sluggish pace, in some particular countries an impressive acceleration of textile imports and garment exports can be noticed. One of these countries is the Indian Ocean island of Madagascar. During the 7th edition of the annual event Origin Africa at Antananarivo last November, a number of Malagasy and foreign garment manufacturers testified they are strongly expanding or setting up new production capacities in Madagascar responding to fast rising demand.

Madagascar is no terra incognita for India. Cultural and trade relations between India and Africa go back to ancient times-from early fourth-century trade, through Britain's shipments of Indian labour to work on colonial projects, to political cooperation during the struggle for Africa's independence. Trade between the two countries is on the rise. Data from the Indian government and the African Development Bank show that bilateral trade between India and Africa rose from a very modest $1.1 billion in 1995 to $75 billion in 2015. Overall, since 2010, India's exports to Africa have increased by 93 per cent while imports rose by 28 per cent.

China and US far ahead

Though India is apparently successful in its relations with Africa, it's still no match for the US and China in terms of political and economic influence and foreign direct investment. Prime Minister Narendra Modi wants to do something about that. At the end of the 2015 India-Africa Forum Summit, a three-yearly event, he announced a $10 billion line of credit over the next five years for Indian companies wishing to invest in Africa. In July 2016, Modi made a four-nation African tour (his first-ever), on the heels of President Pranab Mukherjee who made a first-ever visit to Africa a month prior. At the opening of the Annual Meetings of the African Development Bank (AfDB) Group in Gandhinagar in May 2017, Modi said his government has made Africa a top priority for foreign and economic policy. Pitching for an Asia-Africa growth corridor, Modi said India's commodity trade with Africa in 2015-16 was higher than its commodity trade with the US.

In markets like the US and Europe, many Indian FDI-and trade projects greatly benefit from the market knowhow and business advice offered by the Indian diaspora. There's also an Indian diaspora in Africa. The Indian population in Africa, including people of Indian descent, was estimated to be about 2.7 million in 2015. More than half of them are settled in South Africa, and a third in Mauritius. Many of them are successful as manufacturers and traders. So, it was no surprise that people with Indian names and looks were conspicuously present at the Origin Africa event in Antananarivo, here Mauritian and South African companies dominated foreign participation.

Source: Destination Madagascar