The world’s sixth-largest economy, India, is creating a new market for Turkish exporters due to its expanding middle class and growing needs.
According to data from the World Bank, Trade Ministry, and Turkish Statistical Institute (TurkStat), as of the end of 2017, India is the world’s 6th-largest economy in terms of gross domestic product (GDP) and third-largest in purchasing power parity with an economic size of around $2.6 trillion.
In India’s GDP, the share of the services sector has reached 46.5 percent, followed by the industry with 29.1 percent and agricultural sector with 17.1 percent.
While the country achieved a growth rate of 6.7 percent in 2017, the inflation rate was recorded as 3.3 percent in the same period. India is projected to show a growth performance of 7.6 percent last year.
Given India’s foreign trade figures, the country’s exports and imports in 2017 amounted to $295.9 billion and $444.1 billion, respectively.
Turkey ranked 17th in India’s exports in 2017 with a 1.7 percent share and 48th in imports with 0.3 percent.
In this period, Turkey’s exports to India amounted to $758.6 million, with imports totaling $6.2 billion. Foreign trade volume between the two countries in 2017 was about $7 billion.
Turkey’s exports to India stood at $1 billion in 11 months of the previous year, while imports from the country were recorded around $7 billion.
Socio-economic reforms realized after India’s Prime Minister Narendra Modi took office in 2014 accelerated India’s liberalization and increased foreign direct investment in the country.
India received $2 billion in foreign direct investment in 2000. This figure peaked in 2008 with $47 billion, standing at $39 billion in 2017.
In the period of 2007-2018, some $125 million in foreign direct investment was made from India to Turkey, while direct investment of $233 million was realized from Turkey.
During President Recep Tayyip Erdoğan’s visit to India in 2017, both parties agreed on improving bilateral relations, increasing mutual investments, diversifying bilateral cooperation areas, developing cooperation in the fields of nuclear energy, civil aviation, medicine, aerospace and technology, retaining bilateral Joint Economic Commission (KEK) mechanism regularly, realizing Comprehensive Economic Cooperation Agreement (CECA), and increasing the number of regular flights and destinations between the two countries.
Foreign Economic Relations Board (DEİK) Turkey-India Business Council President Canan Çelebioğlu told Anadolu Agency (AA) that India is a country that has great economic potential among Turkey’s trade partners.
Çelebioğlu pointed out that in trade between the two countries, there are obstacles such as cultural differences, an insufficient number of flights, high customs duties, environmental permits and delays in contracts.
“With the increase in the communication between the businesspeople of the two countries and the lifting of the visa problems, we can increase the trade volume with India in favor of Turkey in line with the strategic goals and priorities of our country,” she added.
Recalling within the scope of Trade Minister Ruhsar Pekcan’s visit to India, the India-Turkey Business Forum was held in December 2018 with the participation of approximately 150 businesspeople, Çelebioğlu said potential business opportunities in various fields, particularly in the banking, food and agriculture and technical consultancy sectors, were brought up during the meeting.
Çelebioğlu stated that the business forum also touched on business opportunities, which could be carried out by the two countries in Africa in the areas of infrastructure, construction and logistics, and witnessed bilateral talks between Turkish and Indian businesspeople.
Meanwhile in her last visit, Trade Minister Pekcan suggested that in the next 10 years India might be the world leader in population, agricultural products and software, highlighting that there is a rising middle class in the country which offers an important market for Turkish exporters.
Pekcan stressed that they will be able to cooperate with India in software, and that India’s Minister of Commerce, Industry and Civil Aviation plans to pay a visit to Turkey with a large delegation in February.