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India, France to double trade

India and France have set an ambitious target of doubling their bilateral trade to over $5 bn over the next three years.

india Updated: Jun 02, 2006 11:46 IST

India and France have set an ambitious target of doubling their bilateral trade to over $5 billion over the next three years and attracting French investments of $1 billion to India annually.

The target was set during a meeting between India's Commerce Minister Kamal Nath - who is here on a three-day visit for the Indo-French Joint Economic Commission meeting - and his French counterpart Catherine Lagarde.

Accompanying the Indian minister is a business delegation of nearly 20 chief executives, headed by SK Poddar, president of the Federation of Indian Chambers of Commerce and Industry (FICCI).

"The total French investment in India, over the last so many years, amounts to only $750 million that has no bearing on the capacity of the French companies to invest and the requirement of the Indian economy," Poddar said.

"I propose that we set a target of at least $1 billion in French investments in India every year," Poddar told the meeting, which was immediately accepted by the French minister who said that she shared the view.

In a move that would lend greater strength to bilateral trade, Lagarde said she would be happy to lead a delegation of over 200 chief executives of small and medium French firms to India in December.

"It is only by involving the small and medium companies that we can add a new dimension to our trade ties and I will be happy to contribute in the effort to promote French SMEs to look at India more closely and seriously," she added.

At the meeting, Kamal Nath said the perception of India in France was still of a mystic country with lots of poverty and problems and not enough potential.

"With a cumulative French investment of only $750 million in India, there is something wrong somewhere and we need to identify the problems and fix them."

He said the two sides must identify key areas for promoting trade and investment and a focused effort should be made to increase bilateral economic ties. Another reason for the low level of trade, were the non-tariff barriers, he added.

Kamal Nath said he had raised the issue of LN Mittal's bid on Arcelor and had been reassured by Lagarde that the French government treated the issue as a commercial deal that was best left for the markets to determine.

"There is no discrimination on basis of colour, race, nationality or religion and the French government will let the markets decide the fate of the deal. We would welcome investments by everyone," Lagarde added.

Harpal Singh, chairperson of Fortis, said the two sides should look at launching some pilot projects in healthcare. "India has the capacities and France needs to maintain its leadership position in healthcare."

He said the projects could establish the case of mutually beneficial ties in this key domain, which also found immediate response from the French minister who urged Singh to work out the details.

"One should not consider these as mere outsourcing but as projects that can lay the basis for a new relationship between India and France," Kamal Nath added.