The Indian business community in Thailand says it strongly believes the Kingdom has the potential to recover soon after a new government is installed, as more Indian investors see this country as a centre of Asean.
At a dinner meeting of heads of commercial concerns and Indian enterprises in Thailand last Friday, Ambassador Harsh Vardhan Shringla said his country had well understood Thailand’s situation as a fellow democracy. He said India was also waiting for a general election next month, while Thailand is expected to have one by the middle of the year.
“After the two countries are able to get new governments, [they] should promptly sign a free-trade agreement so that more trade and investment would be seen. We are also looking for the next step in cooperation between India and Thailand, which should help enhance both countries’ growth,” Shringla said.
The ambassador expects that after the comprehensive FTA between Thailand and India has been signed, the value of two-way trade should increase by 30-40 per cent each year.
Thailand and India plan to sign a comprehensive FTA after implementing an early-harvest scheme covering 83 items in 2003. The comprehensive pact would cover all sectors, including more than 5,000 goods and liberalisation of services and investment.
The ambassador said many new Indian investors were looking at Thailand as their manufacturing base for distribution to other countries, not only in Asean but also to other markets.
On the other hand, he also urged more Thai investors to do business in India, as many opportunities are waiting. They would find a ready source of labour in various sectors and high-technology development, while the Indian government has also accelerated infrastructure development to facilitate more investment.
The trilateral highway connecting India, Myanmar and Thailand should also stimulate more trade and investment.
HK Agarwal, chief operating officer and country head (group affairs, Thailand) of Aditya Birla Group, one of the largest investors in Thailand, said his company had maintained full confidence in this country’s potential for business growth, despite its political problems.
“The company will continue our investment in nine factories in Thailand. Now the firm has used Thailand as a base for re-export to other Asean [countries] and will keep on investing,” Agarwal said. He added that after the comprehensive FTA is in place, more Indian investment should come into the Kingdom.
He said the new government should focus more on increasing competitiveness of Thai industries, as there are many issues of concern such as the high cost of energy and the rising costs of labour and production. The government should also focus more on language training for Thai workers, especially English.
Atul Jogani, president of the Indian-Thai Diamond and Colorstone Association, said Indian enterprises well understood the Kingdom’s situation and expected it to get a new government after an election in the next quarter of this year, just as India would have a general election in May.
“It is just a matter of time. After Thailand gets a new government, and is able to sign the free-trade agreement, the country’s economy should grow strongly,” he said.
However, he pointed out that some new investors, wary of how things might develop here politically, would wait for a while until Thailand gets a new fully authorised government.