Egypt-India Bilateral Trade and Investment Profile

Ever since the establishment of diplomatic ties between India and Egypt 75 years ago, both countries have come a long way in deepening their synergies and partnership. In 2022, India-Egypt recorded the highest ever bilateral trade of US$7.26 billion, with items like crude petroleum, fertilizers, bovine meat, cotton yarn etc. dominating the trade basket. Indian companies have also invested heavily in Egypt, to the tune of US$3.15 billion. As per official statements, fresh Indian investments worth US$700 million are lined up to be injected in Egyptian economy in the upcoming years.

India and Egypt commemorate 75 years of diplomatic ties in 2022. The two countries have witnessed deepening economic ties, attested by a record bilateral trade worth US$7.26 billion in the last financial year (FY 2022).

Egypt is among India’s most important trading partners in the African continent and has benefited from investments from Indian companies to the tune of US$3.15 billion.

Recently at the fifth India-Egypt Joint Trade Committee meeting held in Cairo on July 25, 2022, India’s Ambassador to Egypt, Ajit Gupte, announced India’s plans to inject around US$700 million worth of private investments in Egypt over the coming few years.

India-Egypt bilateral trade and investment profile

India-Egypt trade trends

The India-Egypt Bilateral Trade Agreement has been in operation since March 1978 and is based on the most favored nation (MFN) clause. Bilateral trade between the two countries has expanded by more than five times over the last decade, reaching US$4.55 billion in FY 2018-19.

Despite the COVID-19 pandemic, volume of trade declined only marginally to US$4.5 billion in FY 2019-20 and to US$4.15 billion in FY 2020-21. Trade between both countries jumped by 75 percent year-on-year in FY 2021-2022, amounting to US$7.26 billion.

India’s exports to Egypt in FY 2022 amounted to US$3.74 billion, registering a 65 percent increase over the previous year. At the same time, Egypt’s exports to India during the same period reached US$3.52 billion, registering an 86 percent increase. As per data from Egyptian Central Agency for Public Mobilization and Statistics (CAPMAS), India emerged as the third largest export market for Egypt, sixth largest trading partner, and seventh largest exporter to Egypt. In FY 2021, India’s was Egypt’s eight largest trading partner globally.

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India’s import basket from Egypt is dominated by products such as mineral oil, petroleum, fertilizers, inorganic chemicals, cotton, etc. The main items exported from India to Egypt include bovine meat, iron and steel, light vehicles, and cotton yarn.

India-Egypt investment profile

Indian investments in Egypt

As of June 2022, over 450 Indian companies are registered in Egypt, of which around 50 are active in various sectors with a combined investment exceeding US$3.15 billion. Half of these companies are joint ventures or wholly owned Indian subsidiaries while the rest operate through their representative offices. The major sectors attracting investment include apparel, agriculture, chemicals, energy, automobiles, and retail.

Major Indian investments in Egypt include TCI Sanmar (US$1.5 billion), Alexandria Carbon Black, Kirloskar, Dabur India, Flex P Films, SCIB Paints, Godrej, Mahindra and Monginis. TCI Sanmar has announced plans for additional investments of US$400 million and Flex P Films is increasing their investments by US$230 million in the upcoming years. In November 2021, Indian start-up ZoomCar launched its operations in Egypt with a fleet of around 50 vehicles.

Indian commercial projects in Egypt

Indian companies Larsen and Toubro India (L&T India) and Sterling & Wilson have also executed projects in Egypt, in the energy and telecom sectors. Among various projects, L&T successfully completed the Toshka 2 – Wadi Halfa 220 kV double circuit overhead transmission line. The overhead transmission line was successfully executed in January 2020. Previously, L&T executed 500kV / 220 kV GIS substation projects for Egypt Electricity Transmission Co. in Ain Sokhna and Ras Ghareeb and 220kV overhead transmission line from Safaga to El-Qusair.

Sterling & Wilson (S&W) built a cumulative capacity of 250 MW of Solar PV plants in five projects in Aswan in FY 2019, worth a total of US$250 million, in addition to a data center project worth US$3 million. In February 2020, the company was awarded a contract to set up a cloud data center for Telecom Egypt in a US$30 million deal, apart from a US$2 million worth data center deal with Vodafone Egypt. In December 2020, S&W took over the Kom Ombo Solar Park project from Mahindra Susten following the latter’s withdrawal.

Egyptian investments in India

India has received cumulative foreign direct investment (FDI) of US$37 million from Egypt. Egypt’s El Sewedy group set up in Noida (Uttar Pradesh state) in 2013 for manufacturing smart electric meters.

KAPCI Coatings set up their manufacturing plant in Bangalore (Karnataka) to produce car paints with an investment of US$15 million.

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Modern Waterproofing Group (Bitumode) is a multinational group of companies that is engaged in manufacturing a wide range of products for the construction industry, including waterproofing membranes and protection boards. It has a manufacturing facility in Dahej (Gujarat).

In 2021, an Egyptian IT company M/s 700 Apps started operations in Hyderabad (Telangana) and has plans to expand their operations in near future.

This article originally appeared on India Briefing

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