Egypt eyes greater Indian investments
Egypt hopes India will propel into the top 10 among all foreign investors in the not too distant future.Updated: Apr 19, 2007, 11:09 IST
Leveraging its vastly liberalised economy, Egypt hopes for a quantitative jump in Indian investments and for greater tourist inflows from this country, its officials say.
India is currently the second largest Asian investor in Egypt and 12th overall and hopes it will propel into the top 10 among all foreign investors in the not too distant future, Walaa M El Hussieny of the General Authority for Investment and Free Zone (GAFI) said.
Simultaneously, Egypt hopes the number of Indian tourists will double to 130,000 in two years from the present 65,000, said Khaled Makhkouf, CEO of the tourism ministry's Tourism Development Authority.
The two officials are part of an eight-member high-level delegation that is currently in New Delhi on an investment and tourism promotion drive. The delegation will also visit Mumbai before heading for other East Asian destinations.
While in India, the delegation members will be interacting with industry lobbies, industrialists and government officials to point to the huge changes effected since 2004 to make the country investor-friendly.
To promote investments from this country, GAFI has established a separate Indian desk with each investor being allocated an accounts officer to process applications, arrange for visits and meetings with Egyptian officials and iron out any problems that might arise both during the establishment and the running of a project, El Hussieny pointed out.
"Our reforms for a better business environment have seen taxes on profit and income reduce to 20 per cent from 40 per cent, restructuring of the customs regime, and allowing full foreign ownership and full profit repatriation," she added, explaining why Egypt was such an attractive investment destination.
Over 40 Indian entities have currently invested some $450 million in the African country. Among the major companies represented are GAIL, Tata Motors, Ranbaxy, Oberoi, NIIT, HDFC, Dabur, Unit Trust of India, and Kirloskar.
"India currently ranks second among Asian investors in the (export-oriented) free zones and sixth in the inland investment zones (from where products can both be exported and sold in the domestic market), El Hussieny said.
"Indian investments currently rank 12th overall. We hope India propels to the top 10 among foreign investors in the not too distant future," she added.
El Hussieny, who graduated from Cairo University's Faculty of Economic and Politics just nine years ago, holds four key posts in GAFI: head of research and market intelligence, head of promotion, vice chairman and advisor. She worked for six years as an executive manager to the Egyptian cabinet before joining GAFI two years ago.
El Hussieny, in fact, personifies the new Egyptian woman for whom gender imbalances are "not an issue".
"If you are educated, efficient, capable and deliver what you are meant to, there are plenty of opportunities. You are on an equal footing with your male colleagues," she pointed out.
Speaking about the new investment climate in Egypt, El Hussieny said this had seen foreign inflows increase to $6.1 billion in 2005-06 from a meagre $407 million in 2003-04 - a huge jump of 300 per cent.
Along the way, GDP had risen to 7.2 per cent in fiscal (July 1-June 30) 2005-06 and to 7.9 per cent in the first quarter of the current financial year.
"Market capitalisation is 86 per cent of GDP and our foreign exchange reserves have risen to $26 billion from a mere $4 billion in 2003-04. Our exchange rate is a stable 5.75 Egyptian points to the dollar," El Hussieny declared.
On Egypt as a tourist destination, Makhkouf said the accent was now on moving away from the traditional visits to the Pyramids and Nile Cruises into developing golf courses in various parts of the country, yachting marinas along the Red Sea and the Mediterranean, and desert safaris.
"You have good hotel management skills. We have good experience in tourism development. Together, there is much we can do since we both have great potential," Makhkouf maintained.
"Hitherto, we have been focusing on the mid-section tourists. We now want to target the upper-end segment as also promote mass tourism," he pointed out.
Egypt currently has 176,000 hotel and hopes to increase this to 240,000 by 2011. The industry also generates 2.2 million job opportunities, both direct and indirect.