Mumbai: Egypt will explore the possibility of a free-trade agreement with India to boost bilateral trade and investment, Rachid Mohamed Rachid, Egypt's minister of trade and industry, told a CII meeting. 

"An FTA could be the best move to boost trade and investment. This is what we will discuss with India," Rachid said.

The Egyptian minister would be meeting commerce and industry minister Kamal Nath to discuss the possibilities of an India-Egypt free-trade agreement.

Bilateral trade between India and Egypt is expected to grow from the current $3 billion, even as the two countries plan to enhance cooperation in areas like textiles, iron and steel, cement, building materials, automotive and its components, chemicals, petrochemicals and fertilisers, drugs and vaccines, communication and IT, new and renewable energy and organic fuel for industrial use, infrastructure, housing and real estate development projects, he said, adding, if not an FTA, the two countries should have a framework agreement in trade and investment to cater to the need of both sides.

Kamal Nath welcomed the Egyptian proposal for exploring the possibility of entering into a framework agreement on economic cooperation which will provide opportunity to the two countries for greater interaction in the field of trade and investment.

He said both countries could benefit by cooperating in the field of pharmaceuticals and should explore the possibilities of setting up of joint ventures to exploit the markets in the Middle East and Africa.

Rachid also proposed an Indian industrial zone in Egypt to attract investments targeting domestic market as well as nearby international markets in Europe, Africa and the Middle East. He also invited Indian banks to explore possibilities of setting up operations in Egypt.

Egypt is India's largest trade partner in North Africa, accounting for 40 per cent of India's trade in the region. In terms of value, India's trade turnover with Egypt has grown nearly nine-fold in 2006-07 as compared to 2000-01. India imports a diversified product basket from Egypt comprising of oil, inorganic chemicals and fertilizers (crude).