India, Tanzania Trade Imbalance Worrisome

 

From left: EAC Presidents Pierre Nkurunziza, Jakaya Kikwete, Uhuru Kenyatta, Yoweri Museveni and Paul Kagame during The 15th Ordinary Summit of The East African Community Heads of States at Speke Resort, Kampala.Photo/PSCU 

By Henry Lyimo
THE private sector should champion efforts to bridge huge trade deficit between Tanzania and India and change the current trend of exporting raw crops which is not helping local manufacturing base to grow, a local business leader has appealed.

The President of the Tanzania Chamber of Commerce, Industry and Agriculture (TCCIA), Mr Peter Chisawilo, said in Dar es Salaam on Thursday that trade between Tanzania and India showed impressive growth, but it was in favour of the Asian powerhouse and not helping much the local manufacturing sector.
"We were amused the other day when we were told India is the largest exporter of tanzanite," Mr Chisawilo told members of local and Indian business community at a seminar on business and investment opportunities in India.
Tanzanite is mined in Tanzania but a huge amount from small scale miners is exported in raw form for processing in India and Kenya. The Asian country is the largest exporter of the gemstones followed by Kenya and Tanzania.
The TCCIA chief said the private sector needed to champion efforts to ensure trade and investments between Tanzania and India focused on win-win situation in the spirit of South-South relations.
He said trade figures with India were showing remarkable growth but Tanzania's exports were mainly raw products which was not helping the local manufacturing sector to grow nor earning the country much.
"We are exporting to India raw products without value addition and import manufactured goods. Clearly this will not help us much. We need to change the trend," he said.
According to him Tanzania's imports from India rose from US$ 564 million in 2011 to US$ 1.5 billion in 2013 and exports grew from US$ 210 million to US$ 752.1 million in 2013.
"Trade between Tanzania and India grows fast - but the deficit is huge," he said. He said trade between India and the East African Community (EAC) region showed remarkable growth, but so was the deficit which was growing to tremendous levels.
According to him EAC imports from India had grown from US$ 4.3 billion in 2011 to US$ 8 billion in 2013 and exports rose from US$337 million in 2011 to US$ 857 million in 2013.
The Indian High Commissioner, Mr Debnath Shaw, said figures from Tanzania Revenue Authority (TRA), Tanzania's imports from India reached US$ 1,565.79 million from January to June, this year and exports reached US$ 381.66 million.
He said Tanzania's exports to India were gold, cashewnuts, spices, precious stones, cotton and timber, while imports included petroleum products, medicines, machines and motorbikes including two wheelers and three wheelers.