New Delhi: The Indian Middle Asian trade has four times over the last decade, but said on Wednesday that the huge unused potential that this growth, the CEO of the Export Bank (India Exim Bank) would remain, stressed the need for stronger financial ties.
Bangari, who spoke to the webinar called “Bridging Borders: the role of trade finance in strengthening Indian trade in India-Ccentral Asia”, said Central Asia with its strategic location and abundant natural resources offers immense potential for Indian companies. “At the same time, the growing capabilities of India in production and technology make it a natural partner for the region,” she said. Central Asia includes Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan.
Diversification
Indian exporters certainly seek to diversify new markets after the US has deposited 50% tariff on Indian goods. This step has disrupted the competitiveness in several sectors, which makes it difficult to maintain business in the US, one of the largest Indian business partners.
Exporters are now increasing the efforts to take advantage of new markets such as Central Asia, Africa and Latin America to compensate for the potential loss of the US market.
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According to the International Trade Center in 2024 in 2014, bilateral trade between India and Middle Asia from less than $ 500 million to more than $ 2 billion increased. “There are another $ 2 billion left to unused business potential, which is conditional on a reduction in the limitation of funding, which prevents mainly small and medium -sized exporters,” Bangari said.
Don’t forget the gap
According to the Asian Development Bank (ADB), Covid-19 pandemia, geopolitical tribe and stricter financial conditions, the global gap in the field of business finance funding to $ 2.5 trillion and many businesses without access to credit and risk tools. Almost 80% of all global trade relies on such financial instruments, she added.
EXIM Bank tries to bridge this gap through its business aid program that connects Indian commercial creditors with more than 100 banks overseas. Since its launch in 2022, the program has facilitated more than 1,200 export transactions worth more than $ 3 billion in $ 52, including Uzbekistan and Kazakhstan.
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“The bank also expands loans and guarantees of Indian infrastructure companies, energy and technology projects in the region. It has financed energy transmission projects in Kazakhstan and recently supported the offer of almost zero technology of thermal plant in Uzbekistan,” Bangari said.
“EXIM Bank acknowledges that trade is increasingly bound to global investment flows, and supports Indian companies expanding abroad through funding, loans and consulting services. Investments supported by the bank include businesses in pharmaceuticals, healthcare, hospitality and construction throughout Central Asia,” she added.
The opportunity knocks
Bangari also revealed findings from a joint study with the Euroasian Development Bank called “Examination of Business and Investment Relations between India and Central Asia: Unlocking Economic Benefits” that identify opportunities to deepen cooperation in natural sources to renewable sources.
Key political recommendations in the study include a reinforcement of trade based on identified potential, cooperation in digital public infrastructure (DPI), facilitating the market through common enterprises and technological cooperation, strengthening access to business financing, improving transport and logistics.
“There are many areas where our expertise and resources can converge,” Bangari said. “The challenge is now to create a financial architecture that allows this partnership to realize its full potential.”
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