All Sectors Open to FDI in Belarus H.E. Vitaly A. Prima

Focus

Indian President Pranab Mukherjee’s recent visit to Belarus was the first ever by any Indian head of state. H.E. Vitaly A. Prima, Ambassador of Belarus to India, in an exclusive interview with the Diplomatist’s Editor-at-Large Alankar Srivastava, highlights the significance of the visit, and touches upon various other aspects of the bilateral relationship between Belarus and India. Excerpts:

Your Excellency, share your thoughts on the recent visit of Indian President Pranab Mukherjee to Belarus.

A. Actually, as you already know it was the first visit of such level in the history of independent Belarus. By the way, our president visited India twice—in 1997 and 2007. So we appreciate it highly and, at the same time, positively.

There was a meeting of Shri Pranab Mukherjee with the President of Belarus Alexander Lukashenko, and they talked over different issues of regional and global agenda, mutual interaction on multilateral fora, and bilateral cooperation.

Both presidents also opened the Joint Business Council Meeting in which numerous delegations of Belarusian and Indian businessmen were present. And after all the talks, we see that our leaders have excellent understanding of topical issues and share the same enthusiasm and desire to expand our bilateral relations.

They agreed on a 17-point roadmap aimed at development of multifaceted and long-term cooperation. We consider it as a new milestone in Belarus-India relations, because the roadmap seeks further strengthening of bilateral political, trade and economic, agriculture, defence interaction, cultural and educational exchanges, promotion of two-way investments, tourism, contacts among scientists and researchers, business communities.

The legal basis is already formed between our countries, but nevertheless, we signed several agreements and MoUs in such important areas as taxation, standardisation, textile, broadcasting, and others.

The president of India also visited the Belarusian State University (BSU)—the biggest and oldest higher educational institution of Belarus—where Shri Pranab Mukherjee was conferred upon the Professor Honoris Causa by the Belarusian State University and the monument of Mahatma Gandhi was solemnly opened at the university’s campus. Preparing the visit and working on the programme of the president, we discovered that there were no monument of Gandhiji’s in Belarus, so we have eliminated this oversight.

Don’t you think Belarus should develop a ‘strategic relationship’ with India, which is an emerging global power?

A. India was among the first countries to recognise our newly acquired independence in the early 90s and to establish diplomatic relations with Belarus, which gives a very special touch to the contemporary history of our relations. (The diplomatic relations between the Republic of Belarus and the Republic of India were established on April 17, 1992).

India, with its ever growing influence in the international arena, huge capacity of the internal market of goods and services, rich national culture and ancient history is considered in Belarus as one of its most important and reliable partners in Asia.

I would like to note that the Republic of Belarus observes with satisfaction rapid economic growth and vivid social development of India. We see how many efforts India makes to strengthen global and regional security. Today we witness that India is really on the verge of becoming a great power.

The latest developments in the bilateral dialogue prove that over the past two decades, Belarus and India have become considerably closer to each other.

The evidence of this is a mutual support of the initiatives on the international level, impeccable fulfilment of bilateral agreements, i.e. real projects and contracts.

Our partnership is based on the principles of peaceful co-existence, trust, mutual benefits, and meets fundamental and long-term interests of both nations.

As I have already mentioned, India is a great country with great potential. And the Republic of Belarus intends to foster strategic partnership with India to improve trade and economic activities and strengthen our friendship.

During his visit to Belarus, President Pranab Mukherjee stressed that the turnover of trade between India and Belarus is modest and way below its real potential. What are the steps that must be taken with immediate effect, which will help increase our trade to a level of $1 billion by the year 2020?

A. Certainly, there is a great potential for the growth of bilateral trade. Despite the gradually increasing level of bilateral trade, we do not flatter ourselves with the results and we understand that the bilateral trade turnover is still modest. Therefore, we would like to use new mechanisms of cooperation in the field of trade and economy.

It is important to emphasise that our economies are complementary. Belarus is the flagship of mechanical engineering in the former Soviet Space. Mining, farming (including tractors), municipal, and construction machinery manufactured in Belarus, is well known all over the world.

India’s economy is associated primarily with pharmaceuticals, agriculture and mining.

There are prospects in oil and gas sector cooperation, exploration of mineral deposits, including projects in the third countries.

Exhibitions, fairs, business forums, exchange of business delegations play a significant role in the intensification of business contacts, thus, resulting in the signing of numerous contracts.

People and economic diplomacy play the primary role in Belarus-India rapprochement.

Raising awareness of citizens of the two states, to my mind, is the factor that will give a dynamic development of trade and economic relations.

Sales of Belarusian food stuffs and Indian pharmaceuticals, mutual exchange of technologies can be identified as the areas that can give impetus to the bilateral trade and economic cooperation. Supplies of Belarusian potash fertilisers to India have been and continue to be very important for the country’s agricultural production.

In addition, taking into account ongoing development programs in our countries, I believe that in the nearest future the potential of mutual trade can be realised through the development of industrial cooperation, technology transfer, joint ventures, and assembly plants.

India has decided to grant ’Market Economy Status’ to Belarus. Your comment.

A. Belarus is grateful to the Union Cabinet, Government of India, for granting ‘Market Economy Status’ to the Republic of Belarus. This comradely gesture of the Indian Government is an important signal of its readiness to further develop relations. Of course, this will not go unnoticed in Belarus—not only in the Government, but also among the business community. I am deeply convinced that the decision will be beneficial for both countries.

In the current barrier-free environment, Belarusian and Indian businessmen will feel more comfortable.

Share the details of the ‘Roadmap for India-Belarus Cooperation’.

A. The ‘Roadmap for Belarus-India Cooperation’ could serve as a first step towards a strategic relationship with India. The Roadmap is a results-based document in several areas.

It is expected to join efforts in traditional and small energy, new and renewable resources of energy, metals and mining, automotive and farm equipment manufacturing, pharmaceuticals, oil and gas production, agriculture and food industry.

Now a plan of action for the implementation of the Roadmap is being elaborated. I am confident that with the start of its realisation, we will witness the burst of mutual visits at various levels and signing of new contracts.

Elaborate on the defence cooperation between India and Belarus, which is an important aspect of bilateral relations.

A. Belarus and India established an Intergovernmental Joint Committee for Military Cooperation, the last session of which was held in Minsk in May this year. This mechanism allows us to discuss and approve directions and exact projects. We are also satisfied with the direct interaction of business entities and research centres concerned. A great promise show perspectives of cooperation in optics and optoelectronics, as well as modernisation of wide range of armoured vehicles.

What are the conditions and guarantees offered to investors in order to attract foreign investments in Belarus?

A. Placing a business within the territory of Belarus enables companies to efficiently serve the most receptive and high-growth markets of EU countries, CIS countries, including Russia, Ukraine, Kazakhstan, etc.

The advantageous economic and geographical location of Belarus, well-developed transportation and logistics and manufacturing infrastructure of the country is accompanied by its membership in integration associations such as the Eurasian Economic Union of Belarus, Russia, Armenia and Kazakhstan (EEU).

All of these factors provide unique opportunities for companies interested in establishing and dynamically developing business in the Eurasian region.

There are a number of preferential regimes in Belarus, which could be of use for foreign companies, including taxation planning and optimisation. They include special and beneficial business conditions for setting up business within six free economic areas (0 percent profit tax for 5 years; 10 percent VAT), the High-Tech Park (0 percent profit tax for 15 years; 0 percent VAT), and the Industrial Park ‘Great Stone’ (0 percent profit tax for 10 years). Foreign companies can also get additional tax concessions when placing their businesses in the territory of small and medium towns of Belarus (0 percent profit tax for 7 years, 0 percent VAT for 5 years).

Belarus tries to create favourable conditions for business. Today, the country is the leader in legislation improvement that is confirmed by the World Bank’s Doing Business 2015 research where Belarus is rated 57th out of 189 countries.

Indian Prime Minister Narendra Modi’s ‘Make in India’, ‘Smart Cities’, ‘Digital India’, etc have made global headlines. Where do you see Belarus fitting into these initiatives?

A. Under the program of the Indian Government ‘Make in India’, we see prospects of cooperation in the industrial, agricultural, energy and scientific spheres, which include joint production of dump trucks, tractor equipment, a number of projects in the defence sector.

Belarus could provide its services and products to implement ‘Smart Cities’ programme in India. We are able to take part in the development of environmental friendly and automatically controlled systems of public transport.

When talking about ‘Skill India’, the Belarusian side sees opportunities in providing educational services for Indian citizens, including creation of vocational training centres here, and teachers’ exchange, etc.

Identify key sectors for investments and joint ventures between Belarus and India.

A. FDI attraction strategy identifies the following priority areas for investments in Belarus: Pharmaceutical, Biotechnology, Nanotechnology, Automotive industries and Renewable energy.

However, all sectors of the Belarusian economy are open to foreign investments.

Based on the specifics of each sector of the economy and the individual requirement of each investor, we develop and provide suggestions based on the interests of our partners. As I have already mentioned, we would like to create a joint production facilities of Belarusian mining, agriculture, including tractors, and automotive machinery, as well as equipment of the military-industrial complex in India.

We study the issue of participation of Belarusian enterprises in the modernisation and mechanisation of the coal mines and oil wells in India.

Cultural diplomacy is gaining currency worldwide. How does the legacy of the Indo-USSR cultural relations helps Belarus and India encourage and promote cultural affinities?

A. As we say, culture does not have any borders. I’m happy that we have good contacts in cultural sphere and encourage cultural exchanges between Belarus and India. This is the simplest way to bring our people closer, as you’ve pointed out, to show our people priceless cultural heritage of our countries, to help our people to get acquainted with the traditions and customs of both countries.

In 2013, India’s minister of culture visited Belarus and the two countries signed the Intergovernmental Cooperation Program in the Field of Culture. It confirms that Belarus and India pay huge attention to the promotion of specific activities. In that year, your dancing group ‘Prasiddha Dance Repertory’ and famous Bharatanatyam dancer Prathibha Prahlad, the leader of the group, had also participated in the International Festival of Popular Art ‘The Wreath of Friendship’ in Belarus. There was a huge round of applause for their performance. This year, Belarusian folk group ‘Belaya Rus’ participated in Surajkund Crafts Mela. For two weeks, our dancers and craftsman were presenting Belarusian authentic customs in music, dance and handicraft to Indians. It is already confirmed that our flutists —four young musicians—will participate in the 6th edition of Raasrang World Flute Festival in Delhi in September this year.

Maybe, next year, we are going to organise full-scale Days of Culture of the Republic of Belarus in India to showcase the culture of Belarus and its diversity.

Your Bollywood is a special topic. We are working with some Indian companies to launch joint film production, so, maybe, soon we will see the result of these efforts. But at present, we are permanent participants of a number of film festivals conducted here, in India, with our animations, documentaries and feature films.

Let me tell you that many people in Belarus are interested in the development of yoga practices. Having this in mind, Belarus decided to support an Indian-sponsored resolution in the United Nations General Assembly on the Proclamation of June 21 as the International Day of Yoga.

Intensifying our cultural contacts will lead to the promotion of tourism. We invite Indians to come to Belarus and see how beautiful and green our country is, and what are the opportunities for mutually beneficial cooperation.

In short, I believe that the people of India and Belarus have plenty of things that they can learn from each other and thus, bring our nations closer.

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