Strengthening India-Türkiye Trade and Investment Relations
In a significant move towards enhancing bilateral trade relations, Mr. Mustafa Kemalettin Eruygur, Consul General of the Republic of Türkiye, addressed an interactive meeting with a high-level Türkiye business delegation. The event, organized by the All India Association of Industries (AIAI) and WTC Mumbai, concluded with the signing of a Memorandum of Understanding (MoU) between WTC Mumbai and DEIK-Türkiye-India Business Council. This agreement aims to foster deeper trade and investment ties between the two nations.
Current Trade Relations and Potential for Growth
Mr. Eruygur highlighted that the current trade volume between India and Türkiye stands at approximately USD 8.5 billion. India’s exports to Türkiye account for around USD 7 billion, while Türkiye’s exports to India are valued at USD 1.5 billion. Given that Türkiye’s total trade volume is about USD 600 billion and India’s stands at approximately USD 800 billion, there is considerable potential to expand trade relations further. Türkiye primarily imports raw and intermediate materials from India, such as petroleum-based oils, automotive spare parts, and processed aluminum. In contrast, its exports to India include raw materials and semi-finished products like marble, minerals, and dry fruits.
Türkiye: A Strategic Investment Destination
Mr. Eruygur underscored Türkiye’s strategic geographical advantage, stating that it ranks as the 11th largest global economy in terms of GDP based on purchasing power parity (PPP) and is expected to grow by 3.2% as per OECD projections. Türkiye’s location allows access to 56 countries within a four-hour flight radius from Istanbul, representing a combined GDP of USD 27 trillion.
Key sectors offering investment opportunities in Türkiye include:
- E-mobility
- Life sciences
- Storage chemicals
- Information and communication technology (ICT)
- Machinery and advanced manufacturing
- Aerospace
- Agro-industry
India’s expertise in life sciences and chemicals presents a strong foundation for collaboration in these sectors. Currently, Türkiye’s investments in India stand at USD 100 million, spanning industries such as machinery and automotive spare parts, including a recent investment in Pune. Meanwhile, Indian investments in Türkiye total USD 126 million across multiple sectors.
The Need for a Focused Approach
Dr. Vijay Kalantri, President of AIAI and Chairman of MVIRDC WTC Mumbai, emphasized the untapped trade and investment potential between the two nations. He pointed out that India and Türkiye share deep-rooted cultural and socio-economic ties, and stronger collaboration could yield mutual benefits. While past agreements exist, including trade agreements and investment protection pacts, a comprehensive agreement fostering deeper business ties is still needed.
Currently, Türkiye ranks as India’s 28th largest trading partner, while India is Türkiye’s 18th. Dr. Kalantri suggested that both nations should aim to become each other’s top ten trading partners. In FY 2024, total trade between the two countries reached USD 10.4 billion, but there is potential to double this figure to USD 20 billion within five years. Key sectors with high potential include:
- Textiles
- Pharmaceuticals
- Automobiles
- Agriculture and food processing
- Metals
He further stressed the importance of a Free Trade Agreement (FTA) to provide a significant boost to trade and investment. Trade organizations such as WTC Mumbai and AIAI are ready to offer necessary support to facilitate this process.
The Role of MoU in Boosting Bilateral Investments
Dr. Kalantri noted that bilateral investments currently stand at only USD 336 million, which is far below the actual potential. He emphasized that Türkiye could serve as a gateway for Indian businesses looking to enter the European market. Additionally, Indian companies offer lucrative opportunities for Türkiye’s firms in IT, medical tourism, green energy, and sustainable manufacturing.
A recent investment by a Türkiye firm in Maharashtra’s welding industry is a positive development, and this MoU will further facilitate B2B engagement. Increasing the exchange of trade delegations would also be beneficial in fostering business collaborations, and WTC Mumbai is keen to lead more delegations to Türkiye in the future.
Türkiye-India Business Council’s Perspective
Ms. Hülya Gedik, Chairperson of DEIK-Türkiye-India Business Council, described India as a rising global superpower with immense economic potential. She highlighted that while India has been one of the fastest-growing major economies, there remains a gap between potential trade and actual trade. She encouraged Türkiye’s businesses to explore the Indian market more aggressively, leveraging advanced technology and high-quality products to bridge the trade imbalance.
Ms. Gedik also invited the Indian business community to consider investment opportunities in Türkiye, emphasizing its strategic location at the crossroads of Europe and Asia. She pointed out that Türkiye could serve as a launchpad for Indian businesses looking to expand into European and Eurasian markets.
Enhancing People-to-People Ties
Mr. Hidayet Onur Ozden, Vice Chairman of DEIK-Türkiye-India Business Council and Chairman of GCC Recycling and Refining, emphasized the need to strengthen people-to-people connections to enhance bilateral cooperation. He highlighted that misunderstandings between the two countries need to be addressed, and better communication across government, business, and interpersonal levels is essential.
The interactive meeting was attended by distinguished business and industry leaders along with the WTC Mumbai Council of Management, marking a crucial step in deepening economic relations between India and Türkiye.
The discussions and agreements reached during the event pave the way for expanded trade, investment, and cooperation in key sectors, bringing both nations closer to realizing their full economic potential.