Libmonster ID: UK-1367

N. V. GALISHCHEVA

Doctor of Economics

MGIMO (U) of the Russian Foreign Ministry

Key words: India, economic liberalization, foreign economic policy, "Looking to the East"

Since the early 1990s, India has embarked on large-scale economic liberalization, one of the goals of which was to open the economy to the outside world. As a result, India, which now has the third largest gross national income (GNI) calculated at purchasing power parity (PPP), has become one of the largest economies of our time. The experience of the past two decades shows that the reforms, in general, were successful. They allowed India to gradually and very effectively solve both internal problems (industrial modernization, human development, the fight against poverty and hunger, etc.), and to integrate into the system of modern world markets, occupying new niches in them, and often high-tech ones.

At the same time, there is a clear trend that with India's integration into the world economy, which is considered by its political and economic establishment as one of the factors for ensuring the accelerated development of the national economy, both the forms of India's presence on world markets and in individual regions of the world, as well as Indian foreign economic priorities, are changing. Their identification and analysis become important for the further development of multi-faceted Russian-Indian relations in the context of the ongoing difficult recovery from the global financial and economic crisis and the growing competition between the main economic centers of the world.

WHAT DO WE HAVE AND DON'T KEEP?

Until the early 1940s, India's foreign economic relations were mainly focused on Great Britain-the mother country and British colonies, and from the mid - 1940s and in the first years of independent development-also on the United States. In fy1950/51, the combined share of Great Britain and the United States in Indian exports was 42%, and in imports - 39.1%. The subsequent expansion of India's trade and economic ties with other countries gradually led to the diversification of Indian foreign economic policy and the emergence of new major players on the Indian chessboard, among which the Soviet Union stood out. In the 1950s and 1960s, the USSR, in addition to providing technical, military and other assistance, first of all, significantly helped lay the foundation for Indian heavy industry.

Prior to 1991, India and the USSR enjoyed close trade, economic and other ties for several decades. The Soviet Union provided India with significant financial and technical assistance, assistance in the construction of industrial enterprises, exported equipment, certain types of raw materials, military equipment, and so on. By the mid-1980s, the USSR's share in Indian exports reached 18.4%, and in imports -10.4%.1 India was an important economic partner for the USSR, supplying, on the one hand, ready-made clothing, textiles, tea and other consumer goods, and on the other, being considered in Moscow as a kind of tool for spreading Soviet influence in the South Asian region.

From 1991 to 1993, after the collapse of the USSR, the foreign trade turnover between the two countries decreased almost 10 times to just over $1 billion. Among the main reasons for this is the rejection of the previously existing system based on annual approval by both parties of the list of goods to be delivered and clearing settlements based on the foreign currency ruble. The decline in mutual trade turnover was seriously affected by the financial and economic crisis in India in 1991/92 FY (April 1991-March 1992), the economic crisis in Russia in the early 1990s, as well as the weakness of large and medium-sized private businesses that were just emerging in Russia at that time, which was expressed in the lack of sufficient interest and activity on the part of both Russian and Indian business circles in promoting bilateral cooperation in the 1990s.

page 13

Table 1

India-Russia mutual trade in fy2007/08-fy2013/14

 

Fiscal year 2007/08

Fiscal year 2012/13

FY2013 / 14 (estimated)

$ billion

%

$billion

%

$ billion

%

Export

0,9

0,6

3,1

1,0

3,0

1,0

Import

2,5

1,0

4,2

0,9

3,9

0,9

Turnover

3,4

0,8

7,3

0,9

6,9

0,9



Calculated and compiled by the author from: Economic Survey 2009/10. Government of India. Ministry of Finance. Department of Economic Affairs. Economic Division. February 2010. P. A94, A99; Economic Survey 2010/11... February 2011. P. A94, A99; Economic Survey 2012/13... February 2013. P. A96, A101; Economic Survey 2013/14... February 2014. P. 84, 90.

The Treaty of Friendship and Cooperation between the Russian Federation and the Republic of India of January 28, 1993 became the document that consolidated the interaction of the two countries on a new basis in the changed historical realities. During this period, the issue of Indian debt to Russia, accumulated during the existence of the USSR, was resolved. The volume of trade between India and Russia began to gradually grow again only in the mid-1990s and by the end of the decade exceeded $1.5 billion.

After signing in October 2000. In the Declaration on Strategic Partnership between the two countries, multifaceted cooperation has intensified. It is noteworthy that Russia was the first country with which India signed such a document. As a result of the government's policy of deepening strategic partnership, the volume of trade between the two countries has gradually increased in recent years, reaching $6.9 billion in FY2013 / 14.2. At the same time, it is important to note that Indian statistics, unlike Russian statistics, do not take into account the supply of military equipment and weapons, as well as unorganized, or "shuttle" trade.

It is characteristic that during this period there was an increase in both Indian exports and imports. Despite the quantitative growth in the volume of trade turnover between Russia and India, Russia's share in India's foreign trade turnover is not so large. Moreover, according to Indian Customs statistics, Russia's share in India's foreign trade turnover decreased from 1.45% to 0.9% between 2001 and 2014. In imports, it decreased from 1.9% to 0.9%, and in exports - from 1.97% to 1.0%, respectively .3

Since India has signed strategic partnership agreements with a number of other countries over the past decade, the 11th Russian-Indian summit in 2010 announced the creation of a "special privileged strategic partnership", thus emphasizing the importance for the leadership of our states and business circles of developing close bilateral economic and other ties.

Despite a certain growth in the volume of mutual trade and investment in recent years, their dynamics and nature are still lower than potentially possible. At the same time, it is obvious that the curtailment of multifaceted cooperation with Russia dates back to the very beginning of the 1990s. Then the Indian government realized that in the conditions of the financial and economic crisis in India and Russia and the destruction of economic ties between Russia and the new states that were formerly part of the USSR, Russia's orientation in its economic relations to European states and China is impossible to ensure the previous level of Indian-Russian multifaceted interaction. The financial and economic crisis in India in 1991/92 and the launch of liberal reforms in the economy actually pushed the Indian political and economic establishment to search for alternative options for cooperation and expand it towards the EU, Southeast Asian countries, Japan, the United States, etc.

Thus, to date, two areas of India's foreign economic policy are clearly visible - " Look West Policy "and" Look East Policy", and India manages to maintain a reasonable balance between these areas for the accelerated development of its economy.

INDIA AND THE EU: "OLD FRIEND" AND NEW NEEDS

India traditionally attaches special importance to the development of economic ties with the EU countries. As Indian Prime Minister M. Singh stated in 2005, " The European Union is our largest trading partner. It is also an important source of technology and capital, so in a world where interdependence only increases over time, what is happening in Europe is vital for our well-being."4. For its part, as one of the leaders of the developing world, India attracts the close attention of business and EU governing bodies. It is noteworthy that in its statement-

page 14

Table 2

India-EU mutual trade in FY 2007/08-FY 2013/14

 

Fiscal year 2007/08

Fiscal year 2012/13

FY2013 / 14 (estimated)

$ billion

%

$ billion

%

$ billion

%

Export

34,5

21,2

50,5

16,8

51,6

16,5

Import

38,5

15,3

52,3

10,7

49,5

11,0

Turnover

73,0

17,6

102,8

13,0

101,1

13,3



Calculated and compiled by the author from: Economic Survey 2009/10. Government of India. Ministry of Finance. Department of Economic Affairs. Economic Division. February 2010. P. A90, A95; Economic Survey 2010/11... February 2011. P. A90, A95; Economic Survey 2012/13... February 2013. P. A92, A98; Economic Survey 2013/14... February 2014. P. 79, 85.

at the 12th EU-India Summit in New Delhi in February 2012, President of the European Council H. E. Van Rompuy stressed the EU's willingness to actively contribute to the modernization of the Indian economy.5 Trade and economic ties between India and the EU (formerly the EEC) date back to the 1960s.Meanwhile, the intensification of ties began with the signing of a Cooperation Agreement in 1994. In the last decade, the system of economic cooperation between India and the EU has been improved. Thus, since 2000, the parties have held annual summits, as well as regular ministerial meetings and expert consultations. In 2004, the establishment of a strategic partnership between India and the EU was announced. Since June 2007, the issue of creating a free trade zone between India and the EU has been under consideration.

The EU is India's leading trading partner, despite the fact that in the 1990s-2000s the EU's share in the Indian market declined: in 1990/91 FY -29.4% of total Indian imports, in 1994/95 FY-24.8%, and in 2013/14 FY - 11%. This was largely the result of the Indian government's policy of diversifying economic ties during the post-reform period (in these years, the EU's share in India's total exports was 27.5%, 26.7 % and 16.5%, respectively).6. India's share in the EU's total trade turnover is still not so large (in 2013, it was 2.1% in exports and 2.2% in imports).7. Meanwhile, in 2013 India has become the EU's tenth largest trading partner, moving up from 15th place in 2002.

The "five" largest trading partners of India from among the EU countries traditionally include Germany (2.7% of the total volume of Indian trade), Belgium (2.3%), Great Britain (2.1%), Italy (1.3%), France (1.1%)8. It is only with the United Kingdom and France that India's trade balance has been consistently positive over the past decade.

India mainly exports to the EU countries ready-made clothing and textiles (in 2013-over 17.6% of the export volume), mechanical engineering (10.6%) and chemical industry (13.7%), jewelry and precious stones (7.7%), leather goods (6.5%), agricultural products (6.0%), etc. The most important items of Indian imports from the EU are high-tech goods (machinery and equipment - 28.4% of the total volume, chemical industry products-about 9.4%), as well as jewelry and precious stones (25.5%). It is noteworthy that over the past two decades, the EU and India have also been strengthening ties in the field of trade in services, which reached $ 22.5 billion in 2013. The volume of Indian exports is 10.7 billion euros. The parties also actively cooperate in the field of transport, business services and icts9.

India and the EU have established quite strong investment cooperation. The EU consistently accounts for about 12-15% of total FDI inflows to India. As of January 1, 2013, the EU's accumulated investment in the Indian economy exceeded $ 41.8 billion. euro 10. At the same time, approximately 25% of EU investment is directed to energy-

Table 3

India's trade with leading EU partners in FY2013 / 14 (estimated) ($bn)

 

GERMANY

Belgium

Great Britain

Italy

France

Export

7,5

6,4

9,8

5,3

5,1

Import

12,8

10,8

6,1

4,2

3,6

Turnover

20,3

17,2

15,9

9,5

8,7

Balance sheet

-5,3

-4,4

3,7

1,1

1,5



Source: Economic Survey 2013/14. Government of India. Ministry of Finance. Department of Economic Affairs. Economic Division. February 2014. P. 79, 85.

page 15

Table 4

Mutual trade in services between India and the EU in 2010-2012 (billion euros)

 

2010

2011

2012

Export

9,0

11,0

10,7

Import

11,0

11,8

1 1,8

Turnover

20,0

22,8

22,5

Balance sheet

-2,0

-0,8

1,1



Источник: http://ec.europa.eu/trade/policy/countries-and-regions/countries/ india

public sector, 16% - telecommunications, 8% - transport.

The UK and the Netherlands are the 2nd and 3rd largest developed country investors in India, with 5% and 3.9% of FDI attracted over the past decade, respectively. They invested mainly in energy, telecommunications and transport. At the same time, as the Russian economist Professor V. K. Lomakin notes, it is noteworthy that the share of India in the total volume of foreign direct investment in Great Britain decreased from 7.7% in 1962 to 1.1% in 1981, and then to 0.2% in 2000 and 0.34% in 2007.11

For its part, Indian capital has made some progress in the EU markets. Although its share is still relatively small at 1.1% (compared to 0.6% in 2003), the EU has consistently accounted for more than 30% of Indian direct investment exported abroad in the 2000s. As of January 1, 2013, the volume of accumulated Indian investments in the EU member states reached $ 8.8 billion. euro 12. At the same time, India was among the "top ten" largest investors in terms of capital invested in the UK: only in 2004/05, 36 projects were implemented here with the participation of Indian capital, which created more than 1.4 thousand investments. new jobs 13.

India is a recipient of EU economic assistance. In fy2008/09, FY2010 / 11 and FY2012 / 13 alone, the EU received $250.9 million, $ 0.9 million and $ 10.3 million in grants, respectively. 14 An impressive portion of aid comes from the Aid Consortium of India (FY2017 / 08-FY2013 / 14 over $49 billion), 9 of whose 13 members are also members of the EU15. The most significant Indian donors from the EU countries are Germany and the United Kingdom, which in total provided about 20% of the Consortium's aid in the 2000s. 16

Scientific and technical ties between India and the EU are also being strengthened: in 2001, it was signed (and updated in 2009) Agreement on scientific and technical cooperation. In particular, only British companies account for 11% of the volume of joint developments of foreign companies in India 17. In addition, India has become the EU's fourth largest international partner under the Seventh Research and Technological Development Framework Program18. In particular, Indian experts and scientists are involved in 135 projects in the fields of biotechnology, ICT, health and the environment. Thus, trade, economic and investment cooperation with the EU in recent decades has firmly entered the list of priorities of Indian foreign economic policy.

INDIA AND THE UNITED STATES: IF THE PROCESS CANNOT BE STOPPED, IT IS BETTER TO LEAD IT

The development of cooperation between India and the United States in the last two decades has experienced periods of cooling and warming. A noticeable intensification of bilateral relations was observed only in 2001.

The introduction of economic sanctions by the United States and a number of other Western countries against India in 1998-2001 after its nuclear weapons test showed that the Indian economy was able to survive and was able to develop successfully in the face of a significant reduction in external technological and financial assistance. In addition, it became clear that during the liberal economic reforms of the 1990s, changes took place that radically transformed the entire image of India and contributed to its gradual movement to high positions in the world economic hierarchy. Washington's awareness of this reality has given an additional impetus to the development of economic cooperation between the United States and India, which meets both American and Indian interests.

The fast-growing, dynamic Indian economy, on the one hand, is interested in access to advanced technologies, on the other, it is a profitable springboard for the application of American capital and a market for TNK products (including military ones). In addition, India, which is gaining economic power, is also of interest to the United States as a source of skilled labor that can generate ideas in a variety of scientific fields. In addition, Washington seeks to secure a regional foothold in the face of India in the fight against Islamic fundamentalism and create a kind of counter-terrorism.-

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Table 5

India-US mutual trade in FY 2007/08-FY 2013/14

 

Fiscal year 2007/08

Fiscal year 2012/13

FY2013 / 14 (estimated)

$ billion

%

$ billion

%

$ billion

%

Export

20,7

19,5

36,2

12,1

39,2

12,5

Import

21,1

19,1

25,2

5,1

22,2

5,0

Turnover

41.8

9,6

61,4

7,8

61,5

8,1



Calculated and compiled by the author from: Economic Survey 2009/10. Government of India. Ministry of Finance. Department of Economic Affairs. Economic Division. February 2010. P. A92, A97; Economic Survey 2010/11... February 2011. P. A92, A97. Economic Survey 2012/13... February 2013. P. A94, A99. Economic Survey 2013/14... February 2014. P. 81, 87.

a counterweight to China, which is rapidly increasing its economic potential. The rapprochement of the United States with India can also be seen in some ways as a certain lever of influence on Pakistan, which, although it is an ally of the United States, also considers China as its strategic partner.

Indian-American cooperation resumed in 2001 and continued within the framework of the Next Steps in Strategic Partnership initiative adopted in 2004, which led to increased cooperation in the space industry, civil nuclear energy, and eliminated restrictions on trade in high-tech goods. The Joint Indian-American Declaration19, signed in July 2005, provides for the activation of bilateral relations in a number of areas, primarily in the field of trade, civil aviation, and nuclear energy, can be called truly epochal. The latter direction, however, has caused some controversy in Indian political and scientific circles, since, on the one hand, India has gained access to modern technologies for peaceful nuclear energy and in this regard has gained a kind of parity with the PRC, and on the other hand, it has agreed to put its non - military nuclear facilities under IAEA control.

In addition, the parties agreed to expand the access of American capital, and with it modern technologies, to the Indian economy. The United States also offered India a number of military equipment items, removing restrictions that had been in effect since 1998. 20 In 2002-2010, contracts were signed for India to purchase American weapons worth about $8.2 billion.21 During the same period, the two sides conducted 50 joint military exercises. All this testifies to their serious military-strategic rapprochement.

With the ratification in 2006 of the US-India Agreement on Cooperation in the Field of Peaceful Atoms22, ties in this area have expanded. For the first time since 1974, when India began testing nuclear weapons, the United States de facto recognized India as a nuclear power. In this regard, the way was opened for US-Indian trade in the field of civil nuclear energy, and commercial firms of the two countries were able to participate in projects related to peaceful nuclear energy both in India and in the United States.

In April 2005, a bilateral Open Skies agreement was signed, allowing unrestricted access for authorized U.S. carriers to the Indian market and for Indian carriers to the American market. Until 2005, four American companies-Delta Airlines, Continental Airlines, American Airlines, North West Airlines and one Indian company - Air India-were engaged in air transportation between the two countries. Moreover, each side was allocated 28 flights per week. Now, in accordance with the Open Skies Agreement, three more Indian airlines - Indian Airlines, Jet Airways and Air Sahara-have been allowed to enter the US air transportation market.

Indian-American relations have also expanded in research, education, agriculture, and other areas. In July 2009, the strategic partnership mechanism between India and the United States was launched, which covers interaction on global, regional and bilateral issues, including international security, counter-terrorism, the so-called Dialogue in Central Asia and Dialogue in West Asia, launched in 2011, export control regimes, etc.

The strategic partnership between the two countries, however, does not exclude certain differences between them, including, for example, in the field of environmental standards and the use of financial assistance provided by the United States to India. Despite the improvement in bilateral relations over the past decade, the amount of US aid used in 2000-2013 increased slightly to $112 million (0.2% of the total amount of foreign aid used by India), and US aid was allocated exclusively on the terms of grants. 23

Despite some problems, the growth of Indian-American trade, economic and investment cooperation is evident - the United States has become the fourth trading partner of India after the EU, China and the United Arab Emirates and the third investor in the Indian economy.-

page 17

The world's largest economy after Mauritius and Singapore in terms of accumulated FDI. Thus, in the 2000s, the accumulated volume of US FDI in India exceeded $9.5 billion. American investments were mainly directed to the electric power industry, telecommunications, the service sector, the production of electrical equipment, the food and beverage industry and pharmaceuticals. In India's pharmaceutical industry alone, more than 70 projects involving US FDI are under implementation.24

The United States is also the largest supplier of orders for the development of various computer programs by Indian specialists: together with the United Kingdom, the US share in Indian software exports is consistently over 65%25Tata Consultancy Services Limited, Infosys Limited and Wipro Limited are traditionally among the top three Indian IT companies that provide services to American corporations in the field of computer programming and business process outsourcing. The largest centers for fulfilling relevant outsourcing orders are Bangalore, Gurgaon, Kolkata, Mumbai, Pune, Surat, Hyderabad, Chennai.

According to T. Hyde, a representative of the American energy company The STI Group, " India is attractive not so much in terms of the number of highly talented labor forces, but its quality. The focus is on those who are innovative, creative and truly capable of making a significant contribution to business development. " 26

The main factors that ensured India's success in exporting software to the world market, primarily to the United States, were:

1) Relatively cheap, but at the same time skilled English-speaking labor force. According to some foreign estimates, India ranks 4th in the world in terms of the number of qualified engineers and technicians of various specialties in the field of IT. The quality of technical education provided in India has significantly increased in the last two decades and, in general, is at the level of advanced powers. At the same time, the salary of an ordinary Indian specialist, despite its growth in the last five years, is still lower than that of his colleagues in developed countries. Although in the 1990s and early 2000s the gap in the pay levels of American and Indian specialists was up to 80%, and now it has decreased to 30-40%27, India retains this competitive advantage.

2) The difference in time zones (8-12 hours), which allows India to successfully cooperate in the field of business process outsourcing with American partners - the main consumers of these services.

3) Rapidly improving infrastructure of the telecommunications sector, including due to the competent privatization conducted in India in 1990-2000.

4) Institutional and legislative measures aimed at facilitating the conduct of secure Internet business and improving the work of Indian IT companies in order to turn India into a dynamically developing technological hub. Among them are the following: expanding the network of research universities, innovation clusters, and technology parks throughout the country; creating a legal framework that ensures the protection of copyrights and transmitted confidential data, etc.

The convergence of economic interests of India and the United States in a number of areas also contributed to the accelerated development of interaction between these countries in the 2000s and the increase in American economic expansion in the Indian market, and Indian-in the United States. In addition, another fact that strengthens Indian-American relations remains important - the ideological component, namely, the declared loyalty of both sides to democratic values. Another factor that has a positive impact on the development of interaction between India and the United States can be considered Indo-Americans living in the United States (currently over 2.8 million people 28), representing a certain lobby for the development of Indian-American relations, which is recognized at all levels of the American economic and political establishment.

In this regard, the American expert J.Newhouse noted, "The Indian lobby in the United States is the only one in Washington that is clearly gaining influence at the level of the Israeli lobby." 29 And another expert, P. Murdoch, for his part, added: "Indian immigrants, due to their unusually high educational level, represent one of the most affluent national minorities in the United States. If they start lobbying harder for their interests in the US Congress ... they will become extremely influential; perhaps even more influential than the US-Israel Political Action Committee. The activities of a joint Indian-Israeli lobby could be very interesting. India and Israel share many common interests, including concerns about the spread of radical Islamism and the Islamic bomb, as well as similar positions on nuclear proliferation in the world."30

Clear examples of Indian-American lobbying for Indian interests include: easing economic sanctions passed by the US Congress after India's nuclear tests.-

page 18

Table 6

India-Japan mutual trade in fy2007/08-fy2013/14

 

Fiscal year 2007/08

Fiscal year 2012/13

FY2013 / 14 (estimated)

$ billion

%

$ billion

%

$ billion

%

Export

3,6

2,4

6,1

2,0

6,8

2,2

Import

6,3

2,5

12,4

2,5

9,5

2,1

Turnover

9,9

2,4

18,5

2,3

16,3

2,1



Calculated and compiled by the author according to: see Tables 1, 2 and 5.

in May 1998; preserving the possibility of transferring high technologies to India for the development of the space program; organizing the official visit of then US President B. Clinton to India in December 2000; preparing the Next Steps in Strategic Partnership initiative, etc. As former Secretary of State Mary Albright later pointed out, "Indo-Americans in President Clinton's entourage played a significant role in changing our attitude toward India in the late 1990s." 31

Thus, bilateral cooperation between India and the United States in the last decade has acquired such a significant scope and has been carried out in such key and very sensitive areas that it is quite logical to talk about a significant strengthening of the American vector of India's foreign economic policy.

LOOKING EAST: INDIA-JAPAN ECONOMIC COOPERATION

Japan has traditionally been an important economic partner of India. Meanwhile, with the beginning of large-scale liberalization of the Indian economy, its place in the priorities of India's foreign economic policy has somewhat changed.

Japanese capital began to enter the Indian market in the 1980s through joint ventures. The first such company was the Indian-Japanese Maruti Udyog Limited for the production of Maruti cars, organized in 1981 with the participation of the Federal Government of India and the Japanese company Suzuki Motor Corporation (54.2%). By now, the fully private joint venture (since 2007 - Maruti Suzuki India Limited) has become the largest passenger car manufacturer in India (it occupies over 45% of the market). Honda Motor Co.Ltd., Toyota Motor Corporation, Mitsubishi Group and others are also actively investing in the Indian automotive industry. It is a fundamental fact that most of these enterprises carry out a full cycle of automobile production, and not just a screwdriver assembly. In 2010, about 2/3 of all cars produced in India were produced at joint Indian-Japanese automobile enterprises.32

With the beginning of the liberalization of Indian investment legislation, Japanese capital began to develop more actively in various areas of the Indian economy. This was also facilitated by the Indian Government's "Look East Policy", which involves the development of closer economic ties with East Asian countries (primarily with ASEAN members and Japan). The annual volume of Japanese investments in India at that time averaged about $300 million. In total, in 1991-1999, the volume of Japanese investment reached $2.6 billion. (4% of total FDI accumulated in India), which put Japan on the 4th place in the ranking of leading investors in the Indian economy.

However, India did not become a priority center for Japan's capital application, since the geographical distribution of Japanese foreign investment was mainly focused on the Southeast Asian region, where the position of Japanese business is traditionally strong. India's share in Japan's foreign investment in the 1990s was only 2% (for comparison, Cambodia accounted for 19% of Japanese foreign direct investment, Brunei for 17%, and Myanmar for 11%).33.Japanese capital inflows to the Indian economy declined further in the 2000s, accounting for only 1.6 per cent of total Japanese FDI by 2010. In the ranking of leading investors in the Indian economy, Japan has moved to 6th place, and its share in total Indian FDI fell to 3.4% by 2013. Overall, in the 2000s, Japanese accumulated investment in India totaled $5.511 billion, with annual inflows averaging around $120-160 million.34

Currently, such Japanese companies as Sony Corporation, Panasonic Corporation, Toshiba Corporation operate in the Indian electronics and electrical engineering sector, and YKK Group operates in the clothing industry. In total, more than 550 Japanese companies currently operate in the Indian market.

The leading sectors of application of Japanese capital are: automotive industry (40.6%), electric power production-

page 19

electrical equipment (18.4%), retail trade (6.8%), telecommunications (2.7%) and services (2.7%)35.

At the same time, Japan is one of the leading investors making capital investments in the Indian Industrial Corridor project between the cities of New Delhi and Mumbai, which provides for the creation of a series of special industrial zones by 2025 and the opening of about 100 million new jobs in them. In particular, during his visit to India in December 2011, the then Prime Minister of Japan Yoshihiko Noda announced the first investment contribution of $4.5 billion to this project, 36 and his intention to invest an additional $1.7 billion in the Indian economy in the foreseeable future to finance other industrial projects, including the expansion of the metro network in India. New Delhi 37.

The Comprehensive Economic Partnership Agreement, which entered into force on August 1, 2011 and is aimed at developing trade in goods and services between the two countries, as well as attracting Japanese direct investment in the Indian economy, especially in the industrial sector, can be considered a significant breakthrough in Indian-Japanese relations. At the same time, within 10 years, tariffs between India and Japan are expected to be abolished for 94% of the traded names38. The goal was set to increase the volume of bilateral trade between the countries from $18.5 billion by the end of 2014. up to $25 billion 39.

Despite significant positive changes in the Indian economy over the past two decades, India continues to receive assistance from foreign States and international organizations. At the same time, Japan remains one of the largest Indian donors. Japanese aid provided to India in 2000-2013 under concessional loans is estimated at more than $18.5 billion, and under grants-over $0.6 billion.40

(The ending follows)


1 Economic Survey 1995/96. Government of India. Ministry of Finance. Department of Economic Affairs. Economic Division. P. S-88, S-89.

2 Economic Survey 2013/14... Economic Division. February 2014. P. 84,90.

3 Ibidem.

4 Cit. based on: Chernikov G. P., Chernikova D. A. Europe at the Turn of the XX-XXI centuries: Problems of Economics, Moscow, Drofa Publ., 2006. (Chernikov G. P., Chernikova D. A. 2006. Yevropa na rubezhe XX-XXI vekov: Problemi ekonomiki) (in Russian).

5 Remarks by President Herman Van Rompuy Following the 12th EU-India Summit. European Council - http://eeas.europa.eu/india/ summit_en.htm

6 Economic Survey 2009/10... Economic Division. February 2010. P. A92, A97; Economic Survey 2010/11... February 2011. P. A92, A97; Economic Survey 2012/13... P. A92, A98; Economic Survey 2013/14... P. 79, 85.

7 http://trade.ec.europa.eu/doclib/docs/2006/september/tradoc_ 113390.pdf

8 Calculated by the author from: Economic Survey 2013/14 ... P. 79, 85.

9 http://ec.europa.eu/trade/policy/countries-and-regions/countries /india/

10 Ibidem.

2012. Britaniya v mirovoy ekonomike. M.) (in Russian).

12 http://ec.europa.eu/trade/policy/countries-and-regions/countries/ india/

13 Britain's Trade Delegation to Visit India // The Bangladesh Observer. 15.01.2006.

14 Economic Survey 2010/11... February 2011. P. A109, A110; Economic Survey 2012/13... February 2013. P.A111, A112; Economic Survey 2013/14... P. 101.

15 Participants of the India Aid consortium are: Austria, Belgium, Great Britain, Denmark, Italy, Canada, Netherlands, Norway, USA, Germany, France, Sweden, Japan / / Economic Survey 2013/14 ... p. 100.

16 Ibidem.

Lomakin V. K. 17 Decree. Op. p. 328.

18 The 7tn Framework Programme for Science and Technological Development 2007 - 2013 - http://www.viniti.ru/download/russian/ INNOV/eul.pdf

19 Indo-US Joint Statement // The Bangladesh Observer. 22.07.2005.

20 http://www.state.gov/p/sca/rls/rmks/2012/188935.htm

Frankel Francine R. 21 The Breakout of China - India Strategic Rivalry in Asia and the Indian Ocean // Journal of International Affairs. Spring/Summer 2011. N 2. P. 2 - http://pdfsbox.com/read?-http://www.spp.nus.edu.sg/Handler.ashx7path-Data/Site/Site Documents/wp/2006/wp10_06.pdf

22 http://georgewbush-whitehouse.archives.gov/news/releases/ 2006/12/20061218 - 2.html

23 Economic Survey 2012/13... P. A115-A116.

24 http://www.pharmaceutical-drug-manufacturers.com/pharmaceutical-industry/

25 Annual Report 2010 - 2011 / Government of India. Ministry of Communications and Information Technology. Department of Telecommunications. New Delhi - http://www.dot.gov.in/annual-report/2011/English%20AR%202010 - 11.pdf

26 http://www.outsource2india.com/why_india/why_india.asp

27 http://www.economist.eom/news/special-report/21569571 -india-no-longer-automatic-choice-it-services-and-back-office-work-turn

Kapur Devesh. 28 Diaspora, Development and Democracy. The Domestic Impact of International Migration from India // Oxford University Press. 2011. P. 199.

29 Ibidem.

Murdock Paul I. 30 Tiger, Tiger Burning Bright - or Not? India-US Relations in the 21st Century. US Naval War College. Strategic Research Department. Research Report 6 - 96 - http://www.dtic.mil/cgi-bin/GetTRDoc?AD=ADA313473

Kapur Devesh. 31 Op. cit. P. 197.

32 http://www.forbes.com/2010/07/22/japan-india-investment-markets-economy-car-industry.ht ml

Srabani Roy Chowdhury. 33 Japan's Foreign Direct Investment Experiences in India: Lessons Learnt from Firm Level Surveys // Indian Council for Research on International Economic Relations. Working Paper N 243. December 2009. P. 3 - 4 - http://www.icrier.org/pdf/ WorkingPaper243.pdf

34 Ibidem.

35 Ibid.

36 http://manufacturing-executive.eom/message/2867#2867

37 http://www.bbc.co.uk/news/business-16351065

Frankel Francine R. 38 The Breakout of China - India Strategic Rivalry in Asia and the Indian Ocean // Journal of International Affairs. Spring/Summer 2011. Vol. 64, N 2. P. 12 - http://pdfsbox.com/read?" http://www.spp.nus.edu.sg/Handler.ashx?path=Data/Site/SiteDocume nts/wp/2006/wp10_06.pdf

39 http://manufacturing-executive.eom/message/2867#2867; http://eepcindia.org/indiashow/japan2012/downloads/CEPA-India-Japan.pdf; http://www.mofa.go.jp/announce/announce/2011/6/0630_ 02.html

40 Economic Survey 2013/14... P. 100.


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