 | | | | Is India really loosing the competition with China in the export of OIC market?
India is the third largest exporting destination to Organization of Islamic conference (OIC) countries after China, contributes around 5 percent of total overseas import of region. OIC economies consist of 57 Muslim member states under developed or developing nation of Asia and Africa which are not much self reliance to fulfill the domestic demand of their consumer due to lower production capacity of food products, consumer goods, technology and other infrastructure requirement. Turkey, Malaysia, Indonesia, Iran and other oil rich Arab nation are among the largest importing member of OIC while its total share estimated 8.3 percent in the world import. Cumulative worth of OIC countries import of commodities is estimated 1247596 Million US$ from the overseas market in the year 2010. Being the largest giant in international trade market, China has the largest share accounted around fourteen percent of total global OIC trade, followed by USA and India. To analyze the share of OIC nation import market worth 1142382 Million US $ with the emerging economies BRICS (Brazil, Russia, India, China, South Africa) and with its long term trade partner United States of America (USA), comparative export figures are compiled from the International trade centre database for the year 2009 which are shown in given table:
Above table clearly indicates that China grab the major market share of OIC nation due to its flexible policy by offering the Halal & Muslim friendly products. India is on top in terms of highest share with OIC countries of a country’s total overseas export, one third of India’s export goes to OIC Muslim countries. Apart from product quality and competitiveness, Muslim populations of OIC countries prefer to consume only the products compliant to their religious ethics. India in terms of quality and standard has the better range of products with other countries but the suspicion about Halal or Haram is the key obstacle in expanding the Indian export market to OIC countries. China has hosted several conferences with the consideration to increase its export to Arab and OIC countries while its population size of Muslim is lower to India. Recently 2nd China-Arab States Economic and Trade Forum held in Ningxia to explore the China export to Arab countries with the focus on trade of Halal food. Muslim in India constitutes more than 14 percent of whole population and meat market is mainly owned by Indian Muslim who adhere the strict Shariah norms, whereas majority of Indian population belongs to the vegetarian Hindu community strictly followed to manufacture only non animal ingredient products. India’s export may surge to the highest level in OIC nation with better propagation of Indian manufactured products as more Muslim friendly in compare to other countries.
India has the strategic friendly relations with all OIC countries and emerging nation among the top exporting countries but not able to expand its notable share in highly potential OIC markets. In compare to last year estimates of 2009-10, India’s growth of export to OIC countries is 48 percent in 2010-11. Highest growth is estimated for Somalia (892), Bahrain (266), Kuwait (151), Indonesia (110), Jordan (97), Algeria (86) and Turkey (79) while negative growth is accounted for Libya (-38), Yemen (-29), Qatar (-28) and Turkmenistan (-28). Like the last consecutive years, United Arab Emirates is among the top destination for India’s export. Indonesia, Saudi Arabia, Malaysia, Bangladesh, Turkey and Iran are among the top OIC importing countries of Indian products. The Government of India has the bilateral trade agreement with most of OIC countries. India is also negotiating a Free Trade Agreement (FTA) with Gulf Cooperation Council (GCC) after the study on feasibility of India-GCC FTA indicated that it will be in the interest of India to enter into FTA with GCC which is an important regional block in our neighborhood. The study showed that there exists a large market in GCC countries for both industrial and agricultural products from India. Non diversified Industrial base in GCC offers trade complementarities between India and GCC which will result in increased trade. India will meet its long term energy requirement through secured economic relationship with GCC and GCC will gain in food security by its close association with India.
Counrtsey: Tehelka
Besides jewelry and minerals, India’s main export items to OIC are cereals, meat, processed foods and medicine. India is the largest exporter of buffalo’s meat in the Middle East and other OIC countries like Malaysia, Indonesia and Iran due to its Halal ensure characteristics. Food market for 1.6 billion OIC Muslim populations is highly potential segment to expand the India’s export by promoting Halal certified products.
|
|
|  |  | |  |
| |
|
