RC: How to boost Tanzania's exports to India

Arusha. Local exporters have been advised to add value to their products instead of selling them in raw form.

Raw exports not only fetched lower prices in the international markets but were vulnerable to unpredictability of price fluctuations.

“The more we trade raw items, the more vulnerable we remain to the unpredictability of price fluctuations” said the Arusha Regional Commissioner John Mongella.

He raised the concern during a business symposium organised by Tanzania India Business Forum (TIBF) in collaboration with other business stakeholders here on Saturday.

TIBF was formed two years ago to facilitate bilateral trade between the two nations which is expected to cross over $5 billion this year.

Mr Mongella said trade between Tanzania and India has remarkably progressed to the tune worth $ 4.5 billion in 2021/22.

However, much as he appreciated the blossoming trade which has made the nations much closer, he was concerned by the quality of exports from Tanzania.

“Most of the items exported from Tanzania to India are primarily in a raw state unlike those imported from India to Tanzania,” he said.

The leading exports to India from Tanzania include cashew nuts, cotton link, jute, chicken peas, dried peas, pigeon peas, hides and skins tropical wood and raw gold.

“Our imports from India are usually manufactured goods and services,” he told business stakeholders at an Arusha hotel.

They have mostly been pharmaceuticals, medicaments, vaccines, caustic soda, industrial sugar, motorcycles and jet fuel.

“Principles of economics have taught us that the more we trade raw items, the more vulnerable we remain to the unpredictability of price fluctuations,” he said.

He called on the business symposium to set the stage for the private sector from both countries to appreciate technological progress made in India.

Mr Mongella said although Tanzania’s economy was “predominantly agrarian”, there was room for manufacturing value addition (MVA) especially for the leading strategic crops.

These are cashew, coffee, cotton, palm, pyrethrum, sisal, tea and tobacco which, according to him, have “an economic opportunity for investors”.

He affirmed that the Arusha regional secretariat was ready to facilitate potential investors, from India and elsewhere “to come and invest”.

The Indian High Commissioner to Tanzania, Mr Binaya Pradhan, said his country and Tanzania share vibrant economic and commercial ties.

He described a recent decision by the two countries to trade in their own currencies – the Tanzanian shilling and Indian rupee – as a testimony to increase economic ties.

India is the third largest trading partner of Tanzania with bilateral trade of $4.58 billion in 2021/22 and set to cross over $5 billion in 2023.

India is also among the top five investment sources in Tanzania and as per Tanzania Investment Centre (TIC), it has investments worth $ 3.74 billion.

Avocados have joined the list of agricultural-based exports from Tanzania to enter the Indian market with the first consignment sent in January 2022.

Mr Pradhan added that India was set to increase its investments to Tanzania in technology, manufacturing and engineering sectors.

Already several reputed companies from the fast rising Asian economic giant are operating in the country in engineering and allied projects.

His country’s investments will extend to ICT and the mining sector given that India now has a fairly developed technology sector.

With advancement of existing and emerging technologies, engineering and industrial development will define the coming investments, he stated.

“Our investments will extend to the wood, mining and pharmaceutical sectors,” he told dozens of business stakeholders including high ranking officials of the Indian High Commission to Tanzania and TIBF.

They included those from the East African Chamber of Commerce, Industry and Agriculture (EACCIA) and the Arusha chapter of Tanzania Chamber of Commerce, Industry and Agriculture (TCCIA).

Mr Pradhan added that several reputed Indian companies are already operating in Tanzania in the engineering and allied sectors.

These include L&T, Megha Engineering and Afcons which are implementing water projects in the Mainland and Zanzibar.

According to the High Commissioner, Indian- supported water projects worth $500 million, covering several towns in Tanzania will begin soon.

India is also offering capacity building training to Tanzanian professionals under its ITEC programme, with 4,500 professionals already trained there.

The proposed Institute of Technology in Zanzibar, now in the final stages of construction, was cited as one of India’s support to Tanzania in the ICT sector.

The symposium was also informed that the two nations have signed a Memorandum of Understanding (MoU) on value addition technologies in the minerals.

Under the deal, Indian companies will assist the local firms to develop skills in mineral polishing, lapidary and gemmology.

Tanzania was keen to tap technical expertise from India in mineral processing, including strategic minerals such as graphite, copper and nickel.

TCCIA chairman for the Arusha chapter Walter Maeda said Tanzania has a great potential in the agribusiness sector and implored India to extend the necessary support.