Greater than thirty Indian firms have settled down in Colombia, pushed by the advantages provided by the nation as an funding platform

By Cristhian A Salamanca García

India is a crucial commerce and funding accomplice for Colombia. Regardless of COVID-19, in 2020-21, the whole commerce steadiness was USD1.731 million. Colombia exported USD795 million to India in merchandise like oil and coking coal, wooden, steel scrap, aluminum scrap, vinyl chloride polymers and gold. Whereas India exported to Colombia USD 936 million in merchandise like natural chemical substances, prescription drugs, cotton, bikes in CKD kind, machines, plastic supplies, aluminum. Over a decade India’s FDI into Colombia has been round USD 1 billion in manufacturing and companies of added worth. The enterprise surroundings between each nations boasts of 13 bilateral agreements in lots of fields have laid the inspiration for constructing a stronger relationship, like: Funding Promotion & Safety, Double Taxation Avoidance Settlement, Info Know-how, Hydrocarbons, Enterprise Improvement, together with the newest considered one of exploration and use of Outer House for Peaceable Functions. But, there is a chance to unlock the untapped potential of two-way commerce between Colombia and India.

Almost greater than thirty Indian firms have settled down in Colombia, pushed by the advantages provided by the nation as an funding platform. Colombia additionally enjoys a privileged geographical place, situated within the northern a part of South America, with entry to the Pacific and Atlantic oceans, it’s a gateway to the southern a part of the continent, and is commercially and culturally an influencer to the nations of Central American and the Caribbean, and is a part of the Pacific Alliance commerce bloc. Colombia provides traders benefits as an exporting platform too, for instance to the US due to a Free Commerce Settlement (FTA), amongst different a number of FTAs that the nation has. It’s a politically secure nation, whose financial system all the time grows, and as stated by many businessmen, it’s a profitable market. With a aggressive SEZ regime that grants advantages to companies concerned in manufacturing or service actions different markets will be served, counting a inhabitants round itself of just about 1 billion individuals.

A relentless presence of Colombian firms in India is but to be a actuality. India is producing nice alternatives throughout a number of completely different sectors of its financial system by way of FDI (USD 64 billion in 2020). Sectors like meals processing, ready-to-eat meals, the companies sector, airport companies, safety, water remedy, renewable vitality, city infrastructure, and companies (waste remedy), cosmetics, and luxurious items, could possibly be of curiosity to the Colombian firms. It is a name to the ‘Multilatinas’ and ‘International Latin’ firms from Colombia to return to India and see what the nation has to supply. The expansion of services and products in India will be exponential.

Regardless of the scale and variations amongst each nations, there are enterprise alternatives for each side, like:

Meals and Meals Merchandise: India’s rising inhabitants and revenue per capita will create an enormous demand for high-quality merchandise: fruit, greens, grain, pulses, juices, which Colombian firms produce and with whom Indian firms can make investments/accomplice.

Colombia as a hub for Indian merchandise and manufacturing: localization of the provision chains and nearshoring are two nice choices to cowl the Latin-American market from Colombia underneath the present state of affairs, the place the costs of the containers are very excessive, and the fixed restrictions as a result of covid-19.

ITeS: Colombia has began a race to to determine itself as a know-how hub: the Latin American Silicon Valley, and India is a reference level. India’s personal tech valleys like Bengaluru and Hyderabad; the NITI Aayog Company, the Begin-up India Initiative are necessary to take a look at. As per the RBI, India has 100 unicorns, whereas Colombia has solely two. However with Colombia’s coverage referred to as the “Orange Financial system”, the state of affairs is promising and altering quickly. FDI is welcome.

Media and Leisure: Colombia’s Movie Legislation, provides tax incentives for overseas manufacturing firms of 40{c34e2c9cd63a11c97fab811dbaaefe0cfbb1edd2527888e1a44d36f3491ee811} money rebate on bills paid within the nation on movie companies and 20{c34e2c9cd63a11c97fab811dbaaefe0cfbb1edd2527888e1a44d36f3491ee811} of the quantity paid for logistics companies.

Doing enterprise in India or in Colombia shouldn’t be with out challenges, a few of which can appear insurmountable at first. In our expertise on the Colombia-India Chamber of Commerce we all the time transient each Indians and Colombians on how cultural obstacles will all the time be there, and the way flexibility performs a key function together with persistence within the bureaucratic processes and regulatory frameworks.

(The creator is the Government Director of the Colombia-India Chamber of Commerce, with 10+ years’ expertise working between India and Colombia. He’s additionally an Worldwide Speaker on topics like Intercultural Administration, Enterprise, Design, Innovation and India. Views expressed are private and don’t mirror the official place or coverage of Monetary Categorical On-line.) system/india-and-columbia-business-opportunities/2337980/

India and Columbia enterprise alternatives