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ABIDJAN, Aug 14: India plans to invest $1 billion in oil exploration and mining in war-divided Ivory Coast in the next five years and will open new factories as it strengthens trade ties, its top envoy in the country said on Monday.

With an increasing need for raw materials and energy as its economy expands, India is following China by stepping up its presence in resource-rich sub-Saharan West Africa, where offshore oil output is steadily rising.

Indian ambassador to Ivory Coast Amarendra Khatua took more than 100 Ivorian entrepreneurs and government ministers to an Indo-Ivorian trade commission meeting in New Delhi this month where they drafted dozens of deals to be signed later this year.

Chief among them is India's plan to invest in offshore oil exploration on the Ivorian stretch of the prized Gulf of Guinea coastline which is believed to hold large, untapped reserves.

Ivorian oil production is currently more than 60,000 bpd.

''Indian investment in the mining and hydrocarbon sector in this country will be $1 billion over the next five years,'' Khatua told Reuters in the economic capital Abidjan.

India's Oil and Natural Gas Commission had invested $12 million to explore one offshore block it was now drilling.

Indians were also seeking to mine gold, diamonds, manganese, bauxite, iron ore and chrome, either by starting new mines or by forming partnerships to exploit existing ones, Khatua said.

''India and China -- because of their population demands, economic growth and increasing prosperity -- need energy security, plus they have money to invest now,'' he said.

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India's plans come at a time when some investors in the former French colony are shying away from new business ventures due to the political uncertainty and insecurity that are the legacy of a 2002-03 civil war.

A struggling peace process has failed to reunite the country, split between a rebel-held north and government south, while delayed elections meant to draw a line under the conflict look unlikely to take place as planned by the end of October.

But Khatua was optimistic, pointing out that the mining projects would take time to set up and that the crisis could be resolved by the time these were operating.

''India has identified this market and it believes this crisis will be resolved soon and that it will then be able to penetrate deeper into the market,'' he said.

India has granted Ivory Coast a $26.8 million credit line which it has used to buy 400 Tata buses and farm machinery. A second credit line for agriculture, agro-processing, fishing and information technology would follow soon, Khatua said.

On top of plans to open five plants to process Ivorian cashew nuts locally, Indian pharmaceutical firms are to build two factories producing more affordable medicines in the world's poorest continent.

''There will be Indian drugs which are world class but are cheap ... When (Indian-made drugs) come via western countries it becomes costly. This is about direct access to the market,'' Khatua said.

He put Indo-Ivorian annual trade at $360 million and said it rose by a third in 2005. An importer of Ivorian timber, cotton, scrap metal and foodstuffs, India exports its rice, transport and engineering equipment and textiles to Ivory Coast.

REUTERS