Philippines pitches nickel supplies to India as part of export diversification
The Philippines accounts for 11% of the global production of nickel and was the world’s second-largest producer of the commodity in 2023.
India should source nickel for making batteries from the Philippines at a time when the Southeast Asian country is diversifying from 98% dependence on Chinese buyers, Filipino foreign minister Enrique Manalo has said.
The Philippines and India should also accelerate negotiations for a preferential trade agreement (PTA) as Manila is keen to deepen engagement with Indian businesses in areas such as automobiles, batteries, value-added IT and ITES services, pharmaceuticals, health and agriculture, Manalo said in an interaction with the Federation of Indian Chambers of Commerce and Industry (FICCI) on Monday.
India has backed efforts to ramp up the production of batteries as part of its drive to push electric vehicles (EVs) and move towards green sources of energy. As part of this initiative, it has sought to finalise agreements with countries such as Australia and Argentina to source rare earths needed to make batteries. China currently dominates supply chains for these critical minerals.
The Philippines accounts for 11% of the global production of nickel and was the world’s second-largest producer of the commodity in 2023.
Manalo, who holds the post of secretary for foreign affairs, emphasised the importance of developing the Philippines’ nickel sector with Indian participation. “The Philippines is the world’s largest exporter of nickel ore, with exports valued at approximately $1.95 billion, chiefly used in lithium-ion battery production,” he said.
“Currently, nearly 98% of our exports go to China, with Japan importing the remaining 2%. We are quite interested to see India become a player in our nickel sector, not just for export diversification but crucially for processing and development of a value chain.”
India has imported raw nickel worth about $707 million from Russia, Norway and Japan, Manalo noted while suggesting an opportunity for supply chain realignment. “This represents a natural complementarity between our economies that remains largely unexploited,” he said.
Manalo emphasised that the need to accelerate negotiations on the proposed preferential trade agreement, preliminary discussion for which began about two years ago. This, he said, is crucial for diversifying and expanding commercial ties between the two economies.
He also invited Indian manufacturers of commercial vehicles to participate in the Philippines’ programme for major vehicle modernisation.
“We consider India to hold significant untapped potential as a market for Philippine exports,” Manalo said, pointing to export potential of $577 million. “We are keen to transition from these scoping exercises to the actual negotiations of a preferential trade agreement that will certainly help drive growth upward.”
Two-way trade between India and the Philippines was worth $3.5 billion in 2024, witnessing 8.6% year-on-year growth, with the balance favouring Indian exporters. India supplies pharmaceuticals, automotive components and agricultural products to the Philippines, which exports electronic goods, machinery and select agricultural commodities to India.
Manalo also pitched the Philippines as an investment destination, citing its 5.8% economic growth in 2024 and forecasts ranging between 6% and 8% through 2028. He highlighted recent regulatory reforms, including a competitive 20% corporate income tax rate for registered businesses and VAT exemptions for export-oriented enterprises.
