India – South Africa Relations

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By admin June 4, 2019 18:13

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India’s relations with South Africa go back centuries and have a powerful emotional component. It is here that Mahatma Gandhi began his political career, and over the decades of the 20th century, India stood solidly behind the ANC’s struggle against apartheid.

  • India was the first country to sever trade relations with the apartheid government, and subsequently imposed a complete diplomatic, commercial, cultural and sports embargo on South Africa.
  • India worked consistently to put the issue of apartheid on the agenda of the UN, NAM and other multilateral organizations and for the imposition of comprehensive international sanctions against South Africa.
  • After a gap of four decades, India re-established trade and business ties in 1993, after South Africa ended its institutionalized racial segregation.
  • The African National Congress (ANC) has maintained a representative office in New Delhi from the 1960s onwards.
  • India has actively worked for the AFRICA Fund to help sustain the struggle through support to the frontline states.
  • President of South Africa’s visited India as the Chief Guest on India’s Republic Day this year (2019).
  • Nelson Mandela came to India as the Chief Guest at the Republic Day celebrations in 1995.
  • In 1997, the two countries signed the Strategic Partnership or the Red Fort Declaration.

 

Red Fort Declaration is a clarion call for the developing world to mobilise resources in support of a new agenda aimed at economic development and growth, harmony, and unity amongst nations of the South.

 

Since the Red Fort Declaration, bilateral ties between the two countries have grown stronger and the two countries have MOUs in practically all areas.

  • India & South Africa renewed the Red Fort Declaration with the ‘Three-Year Strategic Programme of Cooperation (2019-2021)’ which aims to boost cooperation between the two countries in a time-bound manner.
  • South Africa is home to the highest number of Indian Diaspora in the African continent, with a total strength of 1.5 million thereby constituting 3 per cent of South Africa’s total population.

Developments / Achievements

Trade & Investments

  • India is South Africa’s fifth-largest export destination, and fourth-largest import origin and is the second-largest trading partner in Asia.
  • Relaxation of foreign direct investment (FDI) rule by India through the lifting of the caps on FDI in nine sectors of the Indian economy, including defence, food retail, local airlines, private security firms and pharmaceutical sectors.
  • Confederation of Indian Industries (CII) has decided to open a regional office in Johannesburg.
  • Some initiatives such as the ‘India-South Africa Business Summit’, ‘Invest in India Business Forum’, the formation of the Joint Working Group on Trade and Investment are already in existence.

 

Education & Skills

  • Since 1993, over 1200 South Africans have received skills and technical training in India under Indian Technical and Economic Cooperation Programme (ITEC).

Science & Technology

  • Department of Science and Technology of both countries have collaborated, especially in the Square Kilometer Array (SKA) project for capacity building and instrumentation development in the area of astronomy were to be implemented under the framework of India-South Africa S&T Cooperation.

Defence

  • Participation of the South African National Defence Force in the first multinational Africa-India Field Training Exercise-2019 (AFINDEX-19) has helped the two forces understand each other’s functioning.
  • Closer defence and security ties featured prominently in the recent India-South Africa heads meet in New Delhi.
  • India and South Africa are also looking towards the manufacturing of defence hardware under the ‘Make in India’ initiative.

 

Partnership in Multilateral Fora’s

India and South Africa have a long history of working together by coordinating their views and efforts in institutions of global governance/multilateral fora’s, in order to achieve greater autonomy and ensure that the agenda of ‘South’ is prioritised.

 

BRICS (Brazil, Russia, India, China and South Africa) – In 2010, the formerly known grouping of BRIC, became BRICS with the induction of South Africa. The BRICS Forum’s valuable contribution in reforming the global financial and economic architecture is well-appreciated by both India and South Africa. BRICS leadership in creating alternative institutions like the NDB is indeed noteworthy. Both India and South Africa remain committed to working together to enhance intra-BRICS trade, investment, and financial cooperation.

 

IBSA (India, Brazil, and South Africa) – Established in 2003, the IBSA Dialogue Forum brings together three large democracies and major economies from three different continent’s facing similar developmental challenges and represents three developing, pluralistic, multicultural, multiethnic, multilingual, and multi-religious nations.

 

G20 – Both India and South Africa recognises G20 as the premier forum for coordination in international financial and economic matters, and calls upon the world-community to utilise monetary, fiscal, and structural reforms to jump-start the global economy. In 2016, India’s agreed on continued support for the South African proposals on the illicit financial flows, the Antimicrobial Resistance (AMR) and for the industrialization of Africa and Least Developed Countries (LDCs) as well as the G20 Action Plan on the implementation of the 2030 Sustainable Development Agenda.

 

World Trade Organisation (WTO) – India and South Africa support WTO as the sole-multilateral mechanism on global trade, commerce, and in the centrality accorded to the development agenda in the Doha Development Round.

 

Concerns

  • Bilateral trade between India and South Africa currently stands at about US$ 10.7 billion, half the target of US$ 20 billion set for 2018.
  • The continuous decline in exports and imports – India’s exports & imports to/from South Africa plummeted from 2013 & 2011 onwards respectively.
  • Lack of direct flights – Business travellers in both countries have long lamented the lengthy travel via other countries to reach South Africa as a barrier in trade and investment.
  • Visa regime – Under the current visa regime, businessmen, academics, and top executives are currently allowed a maximum stay of only four years per visa.
  • Selective & Small Investments – South African investments in India are small in number and are concentrated in sectors like banking, financing, and healthcare.
  • Other major concerns of Indian investors are inadequate infrastructure, poor internet connectivity, an uncertain supply of electricity, and delays in procuring visas.

Way-Forward

  • Peace and Security – As two major regional powers are strategically located in the Indian Ocean, cooperation between India and South Africa is indispensable for maintaining peace and security in the Indian Ocean Region.
  • Naval Co-operation – An increase in both bilateral and trilateral naval cooperation through India-Brazil-South Africa Maritime (IBSAMAR) naval activities, and developing synergies within Indian Ocean Naval Symposium (IONS) will be a step in the right direction.
  • Reciprocity – Just like Indian banks in South Africa operate with full licenses, the same needs to be reciprocated for South African banks operating in India, especially after improvement in the ease of doing business in and ongoing market reforms in India.
  • Address the concerns of investors – ‘Invest South Africa’ and ‘Invest India’ have the potential to boost trade and investment links between the two countries by making sincere efforts.
  • Relaxed visa regime through a bilateral agreement on visa arrangements will allow CEOs and CFOs to stay longer since the inter-company transfer of skills is a difficult task.

High profile visits by Heads of State albeit carry a lot of significance in international politics, but bad economics can never be good politics. Therefore, the first and foremost priority for both the countries is to reverse the slide in trade and address the issues faced by the investors.

Also read: Centre In Damage Control Mode Over Anti-Hindi Protests

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admin
By admin June 4, 2019 18:13