Speaking at the 8th Vibrant Gujarat Summit, a global business forum in India, President Kagame encouraged increased private sector investments from India, highlighting Rwanda as a conducive and competitive environment to do business with a favourable climate for investments. 

 

The global summit witnessed the inking of a number of key bilateral agreements between the two countries including an air services agreement to start direct flights to India’s commercial capital, Mumbai. The move is aimed at improving market access and deepening trade relations between the two nations by reducing travel costs and time. 

 

Trade between India and Rwanda has doubled in the past 5 years. The current bilateral trade between Rwanda and India stands at an estimated $526 million. 

 

According to the Rwanda Development Board, between 2011 and 2016 India was responsible for sixty six investment projects in Rwanda, valued at $317.5 million, creating 3800 jobs in fields such as telecommunications, medicare, education and hospitality. 

 

Rwanda imported goods worth $33 million from India during the third quarter of 2016. The government of Rwanda is on a drive to lower the country’s trade deficit and strengthen its foreign exchange reserve by assisting exporters in identifying new export markets. 

 

Rwandan diplomats to India have also stressed the amount of opportunities available to Indian exporters in the country. Rwanda imports nearly ninety per cent of all its requirement of manufactured goods. 

 

There is a shortage of production facilities in Rwanda and hence a heavy dependence on countries such as India to import finished products especially in the pharmaceutical, construction materials, automotive and textile sectors.

 

Another thing to note is that although Rwanda imports a lot of Indian produced goods, they make their way into the country through third party traders from countries like Singapore, UK & USA, thereby increasing the cost of the imports by nearly forty to fifty per cent in the local market.

 

Indian traders and manufacturers are thus being urged to set up distribution centres and warehouses in Rwanda where finished goods, imported from India can be stored in order to facilitate direct trade with the country. This will ensure greater profit margins for the manufacturers and exporters and a reduced cost to be borne by the consumer, a win-win situation for both Rwanda and India.