24 – 26 March, 2024
Addis Ababa, Ethiopia

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MARKET OVERVIEW

India and Ethiopia have long-standing economic and commercial relations, which are centuries old and can be traced back over 2000 years of recorded history. During the Axumite Kingdom, Indian traders had links with the ancient port of Adulis in the eastern part of Ethiopia and traded silk and spices for gold and ivory.

In recent years, with the opening up of the Ethiopian economy, business ties between the two countries have grown significantly, especially in the areas of trade, investment, agriculture and infrastructure projects.

Bilateral Trade

  • Bilateral trade between Ethiopia and India stood at USD 1.8 billion in 2021, out of which Ethiopia’s exports were about USD 75.13 million. In 2020, bilateral trade between Ethiopia and India was USD1.14 billion, out of which India’s exports to Ethiopia were USD 1.08 billion and imports were USD 56.55 million (Source: National Bank of Ethiopia).
  • Exports from India mainly include primary and semi-finished iron and steel products, drugs and pharmaceuticals, machinery and instruments, manufactures of metal, etc. Major imports by India from Ethiopia were: pulses, precious and semi-precious stones, vegetables & seeds, leather and spices.
  • India is the second largest trading partner for Ethiopia, accounting for 10.2% of Ethiopia’s global trade.

Marketing/Investment opportunities in Ethiopia

  • Areas with most promising potential for investments in the country are agriculture, food-processing, leather & leather products, textile & garments, horticulture, sugar & related industry, chemicals industry, pharmaceutical industry, cement industry, metal & engineering industry, construction, mining & oil and hydropower.
  • Leading non-agricultural sectors and investment include renewable energy, information technology and communications, construction, tourism and aviation. Sub-sectors such as mobile banking services and outsourcing services, website software and technologies, software development for e-Government services, and ICT training services are going to be among the major investment opportunities in the country.
  • The road construction and expansion projects in the country also offer opportunities either to directly involve in the construction work or export of construction machinery, chemicals, and building materials as well as consultancy and supervision services.

Bilateral Trade and Investment

  • Since the opening up of the Ethiopian economy in the last decade, business ties between the two countries have increased significantly especially in the area of infrastructure projects like roads, power, telecommunications and water resources.
  • First meeting of Joint Trade Committee was held in Addis Ababa (1998). The last (fifth) JTC meeting was held in Addis Ababa (Oct 2008).
  • Bilateral Investment Promotion and Protection Agreement was signed on 5 July 2007 but it has not been operationalized.
  • Joint Business Council was established between FICCI/ASSOCHAM and the Ethiopian Chamber of Commerce (1997).
  • Double Taxation Avoidance Agreement signed in May 2011.

Investments

  • Indian companies are in the top three foreign investors in Ethiopia with newer Indian multinationals marking their presence in Ethiopia.
  • There are about 650 Indian companies in Ethiopia with licensed investment of over USD 5 billion of which about USD 3-4 billion is estimated to be on the ground. Indian investors are the second-largest foreign employers in Ethiopia, providing employment to more than 75,000 persons. About 61.78% of Indian investment is in the manufacturing sector, followed by agriculture (13.1%).
  • Indian companies have invested in various sectors like agriculture and floriculture, engineering, plastics, manufacturing, cotton and textiles, water management, pharmaceuticals and healthcare.
  • Some of the major Indian companies include Cadilla Pharmaceuticals, Kilitch Estro, Glocare Pharma, Asian Paints, Jay Jay Mills, Ashton Apparels, Ethio Cements, Arvind Mills, Raymond, Kanoria Textiles, Hansa Flowers, Balaji Manufacturing PLC, Mahavir Textiles PLC, Aarti Steel, Mohan Group, Allanasons, GEC Steel, Ethal Aluminum and Abay Esdee Paints Limited.