According to Malaysia economic expert Avishek Dutta obsrving Malaysia and India commercial relations writes that it has continued on the longstanding relations terms and the Indian industry has been associated for three decades with the transformation of Malaysia from an exporter of primary products into an industrialised and broad-based economy. India is Malaysia’s largest trading partner among countries of the South, excluding ASEAN and China. Similarly, Malaysia has now emerged as India’s second largest trading partner in the ASEAN after Singapore.
The spectacular progress of the Malaysian economy since the late eighties, the new self-confidence of Malaysian entrepreneurs and the liberalisation of the Indian economy since 1991 have triggered new dimensions in bilateral, commercial and economic relations between the two countries. The first half of 2009 saw trade between the two countries standing at RM5.2 billion, compared with RM8.1 billion seen during the whole of last year. The implementation of the trade goods agreement under the ASEAN-India FTA in early 2009 will go a long way in promoting trade and Indian businesses will be able to use Malaysia as a base for entry into the ASEAN Market.
A recently concluded joint study has indicated that the two countries could catapult bilateral trade to RM 16 billion by 2012. The potential sectors for trade between the two nations include petroleum and gas, processed food, animal feed, petrochemicals, healthcare, education, IT and telecommunications, financial; tourism, architectural construction and engineering, distribution and human resource development. Other areas of possible bilateral cooperation between the two nations include ties with Indian institutions of higher learning for joint-research and research centres. India’s exports to Malaysia have increased steadily from $ 672.5 million in 2003 to $ 3.1 billion in 2007. Indian exports during 2008 were $ 3.1 billion, an increase of 47% over 2007. On the import front, Malaysia offers palm oil, petroleum, electronic goods, wood and wood products, organic chemicals, man-made fabrics, spun yarn, non-ferrous metals and machinery.
There are currently over 100 Indian companies, including 61 Indian joint ventures, operatin in Malaysia, while according to the Construction Industry Development Board of Malaysia, Malaysian companies have so far completed nearly 50 construction projects worth $ 2.05 billion in India, while 20 projects are currently under various stages of implementation. Malaysia’s burgeoning engineering- supporting industries, which include metal stamping, machining and casting industries, have witnessed