India’s key Central European partner Poland keen to increase two-way investments in post-Covid scenario

Economy


Central Europe’s biggest nation and India’s traditional partner in the region is keen to invest in India and simultaneously keen to expand basket of Indian investments in the country.

PM Narendra Modi is keen on creating new investment opportunities in India in the post-COVID period and on facilitating the inflow of foreign investments. India is the primary location in Asia for Polish investors (currently 270 mln USD).

Poland would encourage its entrepreneurs to invest in India and also would like to invite more Indian investors to make business in Poland, sources informed ET. “However, for Poland – and many other European states – the lack of bilateral investment treaty is a serious obstacle. We regret that there is no agreement in place between the EU and its member states,” a Polish government source said.

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Increasing two-way investments was one of key issues discussed at the Indo-Polish Foreign Office Consultations held last week through a virtual meet. Poland has also proposed cooperation with India on research and innovation.

The global COVID-19 crisis has seriously challenged free trade and created significant disruptions in global supply chains, which is particularly problematic as regards deliveries of medical and protective equipment needed to tackle the pandemic. The best way to overcome this global crisis is by strengthening international cooperation.

“Poland considers India as a major source of pharmaceuticals and personal protective equipment which have been an essential element of the EU’s response to the COVID-19 crisis. As the world continues to fight the COVID-19 pandemic, it is of utmost importance to increase the production of vital medical supplies and to step up cooperation to ensure continued deliveries of these goods,” according to the Polish government source mentioned above.

“Due to the persisting epidemiological threat related to COVID-19 it is essential to undertake common efforts to limit world supply chain disturbances, as well as mitigate possible negative effects of the crisis on agri-food products supply to regional and local markets. There is also a possibility for broader cooperation in food processing. Poland sells not only high processed food products, like soft beverages, but also offers technologies, which can be applied in India,” the source informed

It may be recalled that the Polish Investment and Trade Agency opened a new Foreign Trade Office in Mumbai in 2018.

Poland is India’s largest trade partner and export destination in the Central European region, with bilateral trade growing almost seven-fold over the last ten years. As per Indian statistics, the overall value of bilateral trade in 2018 was $ 2.351 billion.

India’s export to Poland contributed to 0.48% of overall India’s export. Indian investments in Poland are valued at over $3 billion which comprises companies such as ArcelorMittal, Videocon, Escorts, Strides Arcolab, Ranbaxy, Essel Propack, KPIT Cummins, Zensar Technologies Ltd, Tata Consultancy Services, HCL Technologies Ltd, Infosys and Wipro, Jindal Stainless, Berger Paints India, UFLEX and Glenmark Pharmaceuticals, Rishab Instruments (acquired Lumel) and CRISIL. Total Polish investment in India is estimated at $ 672 million.

Poland possesses world class food processing including preservation/storage technologies while India is one of the largest producers for many fruits, dairy and Agro products. A MoU on Agriculture for technical and institutional cooperation has already been signed between both countries during the visit of Vice President of India to Poland in April 2017.

Around thirteen Indian IT companies, employing more than 10,000 professionals, are currently active in Poland and are operating also their Europe operation from Poland. (Indian IT companies Infosys and HCL have strong presence in Poland providing outsourcing services to various firms, HCL has base in Krakow, where 1200 employees are handling work related to Deutshe Bank).

Presently, about 30-40% of goods exported by India to Poland are reexported to other EU Countries. Poland possesses reputed clean coal technologies and Polish public-sector companies have played a substantial role in development of mining and power sectors in India. Coal India Limited’s trainee engineers received training in Polish mines which specializes in intelligent mining.

India and Poland signed a Memorandum of Understanding last year to enhance bilateral cooperation in the coal and mining sector. Poland offers excellent opportunities to Indian investors and exporters in the automotive sector. With the number of imported used cars being close to one million units per annum, Poland is a large market for used vehicles with an average price of 7,000 Euros. Indian manufacturers are recognizing this opportunity for using near shoring strategy to offer new cars of the same price range for sale in Poland and adjoining countries. Given Poland’s strategic location, shortages in healthcare personnel and 25% growth in pharma market in last 5 years, there are good opportunities for Indian exporters and investors.



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