India has overtaken Singapore to emerge as the largest importer in the Indian Ocean Rim-Association for Regional Co-operation region, reveals a study done by the Exim Bank of India.
India accounted for 18.8 per cent of total imports in IOC-ARC region in 2010 as compared to Singapore, which contributed 17.8 per cent. The IOC-ARC region recorded as much as $1.7 trillion in imports in the period.
The Indian Ocean Rim-Association for Regional Cooperation, initially known as the Indian Ocean Rim Initiative, is an international organization with 19 member states including India, Australia, Indonesia, Singapore, Kenya, South Africa, the UAE, Iran among others.
The Association disseminates information on trade and investment regimes, with a view to helping the region's business community better understand the impediments to trade and investment within the region.
The share of IOR-ARC region in global trade has increased from 8.6 per cent in 2001 to 11.6 per cent in 2010, showing the increasing importance of trade in their economic activity. IOR-ARC member countries accounted for 11.8 per cent of total world exports and 11.4 percent of total world imports during 2010.
On the exports front too India jumped three spots to become the second largest exporter in the region after Singapore. India's share in total exports from IOC-ARC countries increased by nearly a third to 12.6 per cent (of $1.8 trillion) in 2010 from 9.6 per cent in 2005.
The report compiled by the Exim Bank on India's trade and investment potential in IOC-ARC further shows, overall India's trade with countries in the region has increased eight-fold to $156.3 billion from $19 billion over the decade (2001-2010).
While India's exports to the region stood at $69 billion, imports from countries in I0C-ARC were $87.3 billion in 2010. The region accounts for as much as a quarter of the trade taking place in and out of the country.
The UAE supplied as much as 30 per cent of India's imports from the IOC-ARC region. While a whopping 38.8 per cent of India's imports from the region constituted crude mineral fuels, another 30.2 per cent comprised imports of precious stones and pearls.
Interestingly, the UAE was India's leading export destination, accounting for 42.7 per cent of the country's total exports to IOR-ARC region in 2010. The UAE was followed by Singapore, Indonesia, South Africa and Malaysia. Major items in India's export basket to IOR-ARC countries in 2010 were mineral fuels, oils, distillation products, pearls, precious stones, metals among others.
Significantly, between April 2000 and June 2012, IOC-ARC countries Mauritius and Singapore together accounted for 47.7 per cent of global FDI inflows into India. The largest investment came from Mauritius at $65.6 billion, followed by Singapore at $17.6 billion. Cumulative FDI inflows into India from IOC-ARC region amounted to $87.5 billion.
The cumulative Indian direct investments in IOR-ARC region in joint ventures and wholly owned subsidiaries, in equity, loan and guarantees issued stood at $82.4 billion, accounting for over 50 per cent of India's global overseas investments between April 1996 and March 2012.
During the same period, Singapore was India's largest investment recipient among the IOR-ARC member countries, attracting about 47 per cent of India's total investments in the region, followed by Mauritius, the UAE and Australia.