Indian industry eyes investment opportunities in Azerbaijan

New Delhi, Oct 3 (UNI) Bilateral discussions between India and Azerbaijan, that will explore and help define key areas of cooperation and investment and push relations between the two countries onto the fast track, are set for a boost.

The Confederation of Indian Industry (CII) is organising a business delegation to Baku, Azerbaijan from October 4-6, with the cooperation of the Indian Embassy in Baku and the Embassy of the Republic of Azerbaijan in Delhi.

The visit of a key-group of Indian business delegates to Azerbaijan promises to boost commercial ventures and projects in a region that has eclipsed sustained interest by Indian Industry.

This initiative greatly amplifies the level of interaction between the two countries, envisaged by the 1998 agreement, to hold regular consultations on economic and technical cooperation.

The three-day visit of the Indian business delegation to Baku can be seen as part of a long-term strategy to engage with the Caucasus region in general and Azerbaijan in particular.

A new chapter in bilateral trade between the two countries will be flagged off by the signing of a Memorandum of Understanding between CII and the Azerbaijan Chamber of Commerce&Industry.

Businessmen and senior government officials from Azerbaijan and India will be interacting and holding focused discussions on a wide range of issues in sectors such as IT (both hardware and software), IT education, Oil and Gas (new projects), healthcare, medical equipment, mining and mining equipment, the transport sector and auto components, as well as in the agriculture equipment sector.

India's bilateral trade with Azerbaijan was worth 34.67 million dollars till March 2006, with exports worth 28.82 million dollars and imports worth 5.86 million dollars.

India's exports to Azerbaijan comprise meat, pharmaceuticals, apparel, machinery, ores, tobacco and iron and steel; while India's major imports from Azerbaijan include aluminium, copper, electrical machinery, precision instruments, iron and steel, rubber, pearls, precious stones and jewellery.

In 2005, Azerbaijan's global exports were worth over 6 billion dollars while its imports were worth 4.6 billion dollars. The country's number one export is oil. Petroleum and natural gas, petroleum products, oilfield equipment; steel, iron ore; cement; chemicals and petrochemicals and textiles dominate its industry.

Azerbaijan's oil production declined through 1997, but has registered an increase every year since, and even though it faces challenges in making the transition from a command to a market economy, its considerable energy resources brighten its long-term prospects.

Baku has recently begun reforming its economy, and old economic ties and structures are slowly being replaced. Trade with Russia and other Central Asian Republics is declining in importance while trade is rising with Turkey and the nations of Europe.

Long-term prospects will depend on world oil prices, the location of new pipelines in the region, and Azerbaijan's ability to manage its oil wealth.

UNI RA CS HS1608