Geography Reference
In-Depth Information
remarkably active. The results, if encouraging, are however not yet meeting
expectations. Bilateral trade turnover did rise from 9.16 to 15.18 billion FF from
1990 to 2000, the balance of trade favoring India since 1994. Indian exports to
France, along the 1990-2000 decade, rose much more (from 3.68 to 9.44 billion
FF) than French exports to India (from 5.48 to 6.15 billion).
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French investments in India have certainly expanded, from a mere US $2.5
million in 1991 to US $70.2 million in 2000.
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That year, FDI approvals set
France at the ninth position in overall country ranking. Power, petroleum,
telecom, pharmaceuticals, and water management projects attracted French
interests, but the bilateral relationship is still mostly dependent on large projects,
the network of dynamic middle-sized companies being rather weak. Despite
progress, the difficulties underlined by Ambassador Ranganathan in 1994 remain
partly valid. On one hand, India still suffers from the competition of China and
other markets. On the other hand, French businessmen remain less India-oriented
than a number of their European counterparts. Many consider that the process of
investing in India is still too intricate, and too uncertain.
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It is difficult to evaluate how the overall substance of the Indo-French
dialogue is affected by this relatively slender economic relationship. In a way,
the political dialogue stands by itself, as it addresses world geopolitical visions.
Nonetheless, one cannot underestimate the ambit of economic cooperation and
trade interest in strengthening a political and strategic relationship, as the US-
China duet testifies.
Between these two perceptions, there is room for adjustment, for at least two
reasons. First, France is an important player in the field of infrastructure: her
expertise in roads, electricity, ports, railways is recognized in India, but the point
is to attract (and to keep on) the companies. Second, and more importantly,
India's interest for French civil or military technology remains high, despite
existing constraints.
Defense Equipment Constraints
As far as defense equipment is concerned, three restrictive elements have to be
taken into account. First, regarding arms exports, the French Defence Ministry
favors now a much greater coordination between the General Delegation for
Armament (DGA), which offers its technical support, the Inter-Ministry
Commission for the Study of Export of War Materials (CIEEMG) and—here is
the new dimension—the Delegation for Strategic Affairs (DAS), more concerned
with the political dimension of the exports.
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This does not affect India
specifically, but adds to the list of clearances.
Second, is the issue of cost. French military products are said to be of high
quality, but costly. More costly than the Russian goods; more costly than the US
equipment, which is generally produced in larger series. The general evolution of
