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$500 mn credit line offered to Myanmar

$500 mn credit line offered to Myanmar
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First Published: Sat, Oct 15 2011. 12 14 AM IST

Prime Minister Manmohan Singh with President of Myanmar Thein Sein before a meeting at Hyderabad House in New Delhi on Friday. Photo: PTI
Prime Minister Manmohan Singh with President of Myanmar Thein Sein before a meeting at Hyderabad House in New Delhi on Friday. Photo: PTI
Updated: Sat, Oct 15 2011. 12 14 AM IST
New Delhi: Myanmar agreed to encourage investments from Indian firms in the energy sector as India announced a new line of credit of $500 million to promote economic and development activity during the visit to New Delhi by Thein Sein, Myanmar’s first civilian president in decades.
Prime Minister Manmohan Singh with President of Myanmar Thein Sein before a meeting at Hyderabad House in New Delhi on Friday. Photo: PTI
A joint statement released on Friday after talks between Thein Sein, who took charge as the new president in March, and Prime Minister Manmohan Singh said both sides had agreed to “broaden” their ties in various fields and prioritize the promotion of trade, investment, cooperation in science and technology, energy security and border security.
This is Thein Sein’s first visit to India after the landmark 7 November polls that ushered in limited democracy to the previously military ruled country. The joint statement said both countries “encouraged business associations... to enter into closer ties with their counterparts.” To enhance border trade, meetings between the officials of customs, immigration and banks and businessmen representing border chambers of commerce will be held at regular intervals, it said. The two countries also agreed to look at two new border trading points, besides the two already open for business, in Manipur and the other in Mizoram.
The statement said officials had been directed to improve air, rail, ferry and road connectivity between the two countries to improve business ties. Bilateral trade between the neighbours—who share a 1,600 km border—stood at $1.28 billion in 2008 and both countries have set a target of $3 billion by 2015.
“This is a great time for Indian business to enter Myanmar,” said a government official. “There are political changes happening there,” he said, referring to recent political reforms introduced by Thein Sein—a fact the joint statement took note of, welcoming “progress in moving towards an open and democratic framework”.
Myanmar President Thein Sein offers prayers at Mahabodhi temple in Bodhgaya on Thursday. (PTI )
“There are also changes happening on the economic front to bring the country on par with any other modern state to attract investments,” said the official.
“More importantly, the President (Thein Sein) is in favour of increasing trade links with India. Of the strong ministerial delegation with him, most are economic ministers,” he said. According to another official, the $500 million credit line is “the largest that India has extended to Myanmar”. This was to “encourage Indian businesses to take advantage of the opportunities next door”, he said.
At a meeting with the Federation of Indian Chambers of Commerce and Industry later in the day, three Myanmarese ministers—commerce minister Win Myint, industry minister U. Myint Maung and minister for national planning and economic development U. Zaw Min—called on India to take advantage of the changing economic environment since the new government took office with easier and more transparent rules governing investments.
“Revision of existing rules and regulations and promulgations of new laws are shortly to be done for the promotion of economic activity in Myanmar,” commerce minister Myint said. “We found that investment from India is very low, although there are a wide range of areas for investment. I would like to inform you that the Myanmar investment law is under review... the application procedure for investment projects is being simplified to facilitate investment inflows,” he said, adding Myanmar was looking at setting up special economic zones to attract foreign investors.
“Myanmar is located in a strategic area between two populous countries. Myanmar could be a regional business hub after the completion of existing infrastructure projects,” Myint said, as his colleagues Maung and Min urged Indian businesses to “seize the opportunities” in IT, infrastructure, tourism, agriculture, dairy industry and fisheries.
The joint statement said Myanmar welcomed Indian investments in the energy sector and “agreed to encourage further investment by Indian companies... in the oil and gas sectors.” India’s state-run ONGC Videsh Ltd and GAIL India Ltd besides the privately held Essar group already have a presence in Myanmar’s energy sector. On border security, India and Myanmar “agreed on enhancing effective cooperation and coordination between the security forces of the two countries in tackling the deadly menace of insurgency and terrorism,” the statement said.
elizabeth.r@livemint.com
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First Published: Sat, Oct 15 2011. 12 14 AM IST