India has asked Indonesia to consider removing Non-Tariff Barriers (NTBs) on the import of Indian pharma products into Indonesia.
Union minister of commerce and industry Kamal Nath during a bilateral meeting with Indonesian trade minister Mari Elka Pangestu, said that such a step would be beneficial for Indonesia to source cost-effective Indian drugs and pharmaceutical products. He further stated that the Indian pharmaceutical products are being exported to several countries including the highly regulated markets of US, Europe, Japan and Australia.
The two sides discussed issues regarding non-tariff barriers on carbon black, wheat flour, uncoated writing and printing paper and milk products and ascertained the concerns of each other to remove barriers to free flow of trade in these goods.
Nath also underlined the potential of small and medium enterprises (SMEs) in both the countries and stressed the need to explore the opportunities in the each other's countries.
"The Indian small and medium sector is quite strong and would welcome engagement with the Indonesian counterparts and some of the Indonesian products such as wood furniture, handicrafts, traditional textile (batik), food processing, etc, that can find good market opportunities in India," he added.
The commerce minister said there was scope for widening the trade basket between the two countries, particularly in the services sector and highlighted the strengths of financial and banking sector.
He said that Indian banks were interested in taking up stakes in Indonesian banks, with State Bank of India and Bank of India having already started operations there. He also suggested that Indonesia too could think about investing in the Indian banking sector, which would enhance the confidence of Indonesian businessmen and investors to do business with India.
In October 2007 the first meeting of the India-Indonesia joint study group was held in Jakarta, which had agreed to submit a report by June 2008. The next meeting of the group is expected in February in New Delhi.
Bilateral trade between India and Indonesia rose to $6.20 billion in 2006-07, a massive jump of 41.22 per cent over the previous year. The share of India's exports to Indonesia was $2.03 billion and Indonesia's exports to India were $4.17 billion with the balance of trade in favour of Indonesia.
Bilateral trade has shown impressive growth over the last five years with Indian exports growing at a compounded annual growth rate (CAGR) of 30.6 per cent and Indian imports growing at 32 per cent.