Since 1998, Nigeria’s trade with India has increased significantly – rising from $293.71 million in 1999 to about $875 million in 2006. As at 2013 year-end, Nigeria-India trade had surpassed $4.2bn. Nigeria is currently India’s largest trade partner on the African continent.
Initially, India imported palm oil and exported jute goods and cotton textiles to Nigeria. It enjoyed a trade surplus with Nigeria. However, things changed in 1974 when crude oil replaced Nigeria’s other exports.
Nigeria-India trade is now largely dominated by crude oil. As at the end of 2013, Nigerian exports to India, stood at N613.7bn. Of the total N613.7bn exported goods to India, crude oil exports accounted for N601.4bn or 98.4 percent.
Nigeria’s oil is important to India’s quest for rapid economic expansion. Oil from Nigeria accounts for between 20 – 30 percent of total crude oil imports into India. India imports 400,000 barrels per day from Nigeria valued at US$10 billion annually, most of it on spot basis.
Aside from oil, the outstanding portion of 1.6 percent of exports to India is comprised of cashew nuts, wood, cotton, pearls, rubber and gum Arabic.
Nigeria’s import from India however stands at N90.7bn, according to 2013 official trade data. Imports comprise of paper and wood products, textiles, plastics, chemicals, machinery and transport equipment, drugs and pharmaceuticals. Nigeria currently imports more Indian pharmaceuticals than any other country in Africa.
Over the years, India has deepened the scope of its economic engagement with Nigeria. There are currently more than one million economically active Indians living in Nigeria.
Indian companies have invested heavily in Nigeria in the manufacturing, pharmaceuticals, plastics, engineering, information technology and communications sectors.
Indian investments have projects like the Ajaokuta Iron and Steel Industry, Aladja Steel Complex in Delta, Telecoms multinational giant Airtel, FMCG Company Dufil, among others.
Nigeria, in turn has continued to actively encourage Indian companies to invest and expand in key sectors like Nigeria’s mining sector.
The outlook for Nigeria-India trade is very promising. India’s population is the second largest in the world, standing at 1.25 billion. Its economy is the tenth largest in the world. On the back of this, its energy resource demand appears dauntingly huge. For the foreseeable future, energy imports from exporters like Nigerian will play continually play a huge role in both economies.
India is also a huge buyer of the Nigerian agro-commodity, cashew nut. India is a major global processor of cashew nuts. Currently, processing capacity has outstripped its production capacity.
READ ALSO: NAFDAC blacklists Mars remedies, India for manufacturing falsified medicine
Thus, it now imports raw nuts to make up for the shortfall. Imports from Africa have risen to over 203,000 tonnes.
Nigeria meanwhile is the sixth largest exporter of cashew nuts, behind India. It exports most its raw cashew nut to India and Vietnam while the processed cashew kernel is exported to Europe and America being the largest consumer in the world.
Cashew is grown in areas such as Ogbomosho, Ilorin, Oyo, Anyigba, Enugu, Lafia, Keffi, and a host of other locations.
DOZIE IFEBI
