India eyes food processing boost from €12bn trade pact with France
The two Governments said the target would see them bid to double their trade exchanges in a balanced way over the period 2008-2012 – despite the effects of the global economic recession.
A key component in delivering huge French investment in India would be the lifting of the cap on foreign direct investment (FDI) in the retail and insurance sectors, France’s Finance Minister Christine Lagarde said yesterday. Delhi has already signalled that is willing to consider more investment from abroad but the issue is source of fierce debate in the country. India has previously encouraged FDI in the food processing sector.
Food processing
While yesterday’s announcement centred primarily on the nuclear energy, transport and aircraft sectors, a joint statement from the countries underlined the importance of developing India’s food processing industry.
“France and India recognize the strategic importance of the agricultural and food processing sector in addressing the needs for affordable, healthy, high quality and sustainable food products in both countries,” said the French Government.
The statement went on to highlight the joint intention to “double and balance exchanges of agricultural products as part of comprehensive cooperation including food products logistics, the distribution sector and agrifood research.”
The governments praised the ongoing work of the Indo-French Joint Working Group on Agriculture and identified a slew of areas for future co-operation – including strengthening the cold chain, wine processing, as well as research programmes and schemes to improve animal identification and tracing and genetic improvement of dairy cattle breeds.
Investment and research exchange
The agreement also welcomed prospects for Indian investment in France. The French are India’s fifth largest European trading partner while India is the thirteenth biggest investor in France, the Indian Food Processing Ministry said.
Shri Subodh Kant Sahai, Minister for Food Processing, said research in food processing technology could be an important area of cooperation between the two countries thanks to France’s superior processing levels.
French experts could identify their premier institutes conducting research in the field so that Indian counterparts can be identified for exchange of ideas, he added.
“The specialties of the French industries in cultivating the specific variety of standard size of vegetables for the purpose of canning and bottling are well known internationally,” said Shri Sahai. “The exchange of the information and technology in this field will be of immense help to the industries in India.”
France is the latest country to look to tap into the vast potential offered by burgeoning Indian economy. Germany, Canada and the US have all previously signed agreements or expressed an interest in investing in the sub-continent.
