KWANG POON
On 7 September 2021, during a webinar organised by the Indian Business Council (IBC), in collaboration with the Indian High Commission in Mauritius, High Commissioner Nandini Singla invited Indian businesses to take advantage of the facilities offered by the Mauritian International Financial Centre (IFC) to invest into Africa.
In July 2021, the Trade Promotion Council of India also organised a similar event in collaboration with the Mauritian High Commission in India. Mauritian HC Maya Hanoomanjee noted that Africa imports only 6% of its goods from India; therefore, there is much scope for growth. By virtue of its membership of the SADC, COMESA and AfCFTA, Mauritius enjoys duty-free or preferential access on most products exported to the African continent. She thus urges Indian entrepreneurs to use Mauritius as a ‘fulfilment and finishing base’ with local value addition before exporting to Africa.
During the opening speech, HC Singla underlined that already 90% of Indian FDI into Africa is mediated through the Mauritian IFC. Other Indian companies who go directly to Africa also end up structuring and managing their operations through their Mauritius holdings once they grow into multinational entities.
The Mauritian offshore sector was started thanks to the shared vision and special ties between India and Mauritius. For several decades, Mauritius has been one of the major financial hubs through which FDI is channeled into India by leveraging the DTAT. Today, with the emergence of Africa, we are seeing more and more FDI in the other direction, moving capital and know-how from India to Africa via Mauritius.
Sectors which can benefit from closer India-Africa partnerships include: Agriculture, Edtech, Digitalisation, Renewable Energy, Pharmaceuticals and Medical Devices.
India has financed to the tune of USD 600M the Light Rail Transport (LRT) system known as Metro Express in Mauritius. Larsen & Toubro is the main contractor on this flagship project. In addition, India built the ENT Hospital and New Supreme Court Tower. Bharti Airtel and Mahanagar Telephone Nigam Limited (MTNL) have also greatly contributed to the high penetration of mobile communications in Mauritius.
InfoSys was one of the first IT firms to set up shop in the Ebene Cybercity in Mauritius, which ambitions to become a Digital Hub in Africa. The Indus Entrepreneurs (TiE) have also set up an antenna in Mauritius to support the emergence of a hi-tech startup ecosystem. Thanks to its bilingual workforce fluent in both English and French, Mauritius can assist Indian IT companies to enter Francophone Africa.
As a matter of fact, the Kukuza Project Development Company (KPDC) was registered in Mauritius, with offices at the Ebene Cybercity, to leverage the gateway function of Mauritius to undertake project development and accompany Indian companies to enter the promising African market. For that purpose, it has signed an agreement with the Mauritius Africa Fund (MAF) which is promoting a number of Special Economic Zones (SEZ) and Smart Cities in Africa. In the same line of thought, HC Singla announced that India plans to establish an India-Africa SEZ in her native state of Karnataka to give a new impetus to partnerships between the two emerging giants in the industrial sector.
Since Mauritius is situated right along key maritime trade routes from Asia to Africa, and even further to Latin America, Indian Oil firmly believes that Mauritius is in an ideal position to host a Bunkering Hub. The recent Wakashio oil spill and logjam caused by Ever Given blocking the Suez Canal has put under the spotlight the importance of the Cape route via Mauritius.
With the COVID-19 pandemic still plaguing the world, Landscope Mauritius is setting up a Biotechnology Business Park to attract pharmas to produce vaccines for the local and African markets. In that area, Ajanta Pharma has successfully set up a manufacturing plant in Mauritius to produce antimalarials for the African market. To attract more investors in the nascent pharma sector, Mauritius has designed an attractive package of incentives while leaving some room for negotiation.
With the advent of the India-Mauritius Comprehensive Economic Cooperation and Partnership Agreement (CECPA) which has become effective since 1 April 2021, HC Singla highlighted that new vistas of cooperation have opened up for businesses on both continents. The current CECPA is a work in progress, and she invited businesses to submit proposals in order to fine-tune it in order to seize upon even more business opportunities.