Embassy of Colombia’s Bimonthly Newsletter

April 2011

The picture above is of - Cano Cristales, touted as the most

beautiful river in the world (also called as the “River of five

colors”), and is definitely a treat to human eyes. It is so

indistinguishable from other rivers of the world, that just a look at

it or a beautiful visit to it can leave an everlasting impression on a

person. A river flowing in Colombia runs for about 100 km before

joining into the main water body. It is located in the northern part

of Colombia, in “Sierra de la Macarena”. It was declared “most

beautiful river” by National Geographic Channel.

DAKIA - A newsletter that highlights and represents the

Colombia’s diplomatic mission in trade, commerce, investment,

culture, and other bilateral aspects between India and Colombia

Embassy of Colombia

85, Poorvi Marg, Vasant Vihar, New Delhi - 57

[+91-011-43202100-04]

[+91-011-41662104-08]

www.embajadaenindia.gov.co

INDEX

Editorial

India – Latin America Relations

Photo Report:

Nasscom Visit – Jan 2011

Bilateral Ties Colombia becoming a true destination for Indian Investors Economic Affairs

Colombia receives higher investment grade from S&P

An Indian company joins hands with Colombian firms to enter Colombian Hydrocarbon Sector.

Art and Culture

Interview: Diplomat turns fiction writer to promote bilateral relations JNU: HispanOtsav

Facts and Figures: Colombia Automotive Report

Special report Ambassador’s message for Japan India’s contribution to Colombia during rains and floods

Editorial: From Ambassador’s Desk

India – Latin America Relations

Ambassador Juan Alfredo Pinto’s Speech on GRULAC’s dinner with Mr. Scindia,

Minister of State of Commerce and Industry of India on 13th April 2011.

Latin American and Caribbean countries constitute a region blessed by The Gods with an abundant natural endowment of renewable and non-renewable resources. One quarter of the fresh water on earth is owned by this area which is also the most bio diverse in the planet. This part of the world is the leader in primates, amphibious and birds, first in reptiles and mammals. Its entomological base also gives it the first place in insects. Light, water, large and fertile lands and plains make Latin American and Caribbean countries an important producer of wood, sugar, alcohol, cereals, fruits, grains, cocoa, coffees, tubers and animal protein. The subsoil is also rich produce oil, gas, gold, silver, copper, platinum, emeralds, jade, coal, tin, iron. The Andes, one of the higher mountain ranges and its valleys turn countries in important producers of hydraulic energy. Our countries do not have religious conflicts, they practice the democracy and our people are an outstanding historical example of mix of races. This feature is the foundation of an eclosion of extensive cultural expressions that feed all arts and makes our countries formidable touristic receptors. The richness of Latin America has been used along the centuries to facilitate the capital accumulation and industrial development of Europe and US. Mining activities in our continent gave the liquidity to the commercial development and shipping industry in Europe, strengthened the industrialization process in the north and created an unbalanced pattern of trade characterized by export of commodities and import of manufactured goods that took us to an economic relation based on value added industries outside our territories, where, additionally, was created the accumulation of human and social capital. Meanwhile, we muttered our less relative development, as a consequence of that pattern added to other factors as concentration of property, colonial and neocolonial interventions and disruptions to the democratic order. Times have changed and Latin American and Caribbean countries too. The mayor Latin American economies have achieved a significant productive structure. The opportunities for our people have increased in a remarkable way during the last decades. Our more internationalized economies have already arrived to the Asiatic markets in a competitive way. Democracy and multi-polarity are tendencies in the world. As we know “shifting wealth” is a big movement from the north to the East and the South determined by the emergent countries. For the first time there are signals of convergence through the worldwide economy. Latin America and Caribbean countries do not wish to repeat with emergent powers the historical cycle lived with Europe and US. We contribute, with natural resources and commodities, raw materials and consumables, to the accumulation process of emergent economies. Although, we will continue to strengthen those commercial flows, we cannot remain in the lowest scale of integration because it is not sustainable in the long run and because politically our relation could lose legitimacy. We are in the presence of a historical moment, to materialize a new integration south- south going beyond good intentions and overwhelming rhetoric speeches. The relation between India, Latin American and Caribbean Countries, can mark out new course of reciprocal benefits, enabling to enhance the human development of our continents, only if, with entire political will; we dare to boost the structuring of international value chains that have Indian companies acting as pivots in Latin America, by strengthening the bond between companies of both regions, increasing the investment, the technological development of our productive bases and the skills of our human capital. Possibilities to articulate our economies in sectors such as oil and gas, petrochemical and its derivatives, allowing the creation of value added among the regions is evident. It clearly appears that the perspective to integrate investment and productive chains in food industry considering that we have the raw materials and the markets and we only require the practical agreement in the sphere of food processing. It is possible also to articulate the international production of bio-combustibles with a responsible ecological use of our cultivable areas as well as through a joint management in the generation of alternative energy.

There are huge possibilities in the development of new pharmaceutical researches and investment in pharmacological projects of common interest. Our diversity in languages gives us significantly big opportunities. We have a great Anglophonic and Hispanic Caribbean region with a historical Indian presence in Trinidad and Tobago and in the north of South America. It is time to work on bilingualism programs but also we have to use and create facilities to take advantages of the Hispanic US market for BPO and KPO services, as well as the development of cultural industries, tourism and other areas in the third sector. The modern mining industry, that adds value to the process and doesn’t limit itself to the extraction of scarce and non-renewable resources but define steps in the homogenization and standardization of products to ulterior uses. It’s a seam in our joint proposal, as well as the integration of jewelry and precious stones industries. This meeting with the GRULAC Ambassadors is a pertinent occasion to express to you, Hon Minister, our interest in a more extended and deeper integration. We have all great respect and affection for India. We admire its dynamism and we vote for a major participation of India in the future of the humanity. We respect the decisions that India takes to strengthen relations with different regions in the world. But, we declare that our region, is a low risk political zone, firmly democratic and with a prosperous business sectors and high economic potential. We are not a region with a historic or political fatigue. We do not have hegemonic pretensions neither we build rivalries. We are a continent of peace and freedom and in the name of those values we want to engage more and more with India, for that, we require a deeper commitment of India with LAC for our future integration.

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Photo Reports…

NASSCOM India Leadership Forum: Colombia – Country Session

GENPACT to start SBU in Colombia

February 8 – 10, 2011, Mumbai

Colombia as Silver Sponsor

The Presentation of Colombia

The Country Session

The Team, Media Interviews, The Stall

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Bilateral Ties

Colombia is becoming a true destination for Indian investors The last two weeks have been full of good news for Colombia in economic perspectives, supporting the fact why is the “C” in the acronym CIVETS that include Indonesia, Vietnam, Egypt and Turkey the countries considered by HSBC CEO, Michael Geoghegan, will follow the growth pattern of BRIC’s in the next decade of XXI century. Just one week after Standard and Poor’s raised Colombia’s foreign-currency sovereign credit to investment grade, the South American country and Canada’s Free Trade Agreement (FTA) signed last year will come in place. The FTA will open clear opportunities to Colombian vendors as well as foreign companies that have chosen the country as hub for its operations in the Americas as 98% of the goods manufactured in Colombia will get access to Canadian with a preferential tariff of 0%. Indian global firms and Entrepreneurs can develop their strategy for American market taking Colombia as a manufacturing hub to reach this important market. Sectors, such as, agrochemicals, petrochemicals, jwellery, pharmaceuticals, and OEM are most lucrative of all. Along with the treaty, the country has the raw materials that can be transformed into final goods, cost competitive human resources, and strategic location, and good connectivity that allow to provide better service to Canadian clients. Public purchases also open a wide opportunity for companies that are interested to supply the provinces of Canada which buys US$ 17 billion average per year. Garments, medical supplies BPO and KPO could have an interesting market to tap.

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Economic Affairs

Colombia with a positive investment grade: A magnetic pole for

Indian investors

ITES, Pharma, Oil, OEM, Biofules, Healthcare and hospitality sectors in

India

New Delhi, March 18, 2011. Communications, Embassy of Colombia In recent months, Colombia has seen exponential growth from Indian investors in various sectors. To begin with, during Nasscom Forum 2011 held in Mumbai, Pramod Bhasin, CEO of Genpact, announced about his strategy and interests of setting up a SBU in Colombia. The other industry sectors that have showed interest are ITES, Pharma, Oil, OEM, Biofuels, Healthcare and Hospitality. To add to this, S&P raised Colombia one step to BBB-, from BB+. The increase puts Colombia’s rating in line with that of Brazil and Peru. Moody’s Investors Service and Fitch Ratings rate Colombia one level below investment grade. President Juan Manuel Santos said in a statement on the presidential website on the rating increase “allows many companies, funds and institutions with considerable resources to invest in Colombia” Ambassador of Colombia to India, Juan Alfredo Pinto, said BIPPA, DTAA and BBB- are the tripod to support Colombian promotion of Investment. As quoted in a news resource, “A lot of people expected it for a very long time,” said Alberto Bernal, head of fixed-income research at Bulltick, a Miami-based brokerage that focuses on Latin America. “I expect Moody’s to move very fast after this. They’ve been very vocal on the possibility of an upgrade coming for Colombia.” Santos, who took office in August, and Uribe, his predecessor, have drawn investment by improving security and weakening rebel groups, including the Revolutionary Armed Forces of Colombia, or FARC. Foreign direct investment more than quadrupled in the past decade, to $7.2 billion in 2009 from $1.5 billion in 1999. “If Santos’s policies continue to be market friendly, and if they are able to hold onto gains that have been achieved in security, there will be further upgrades,” Bernal said. Alejandro Pelaez, Director of Proexport Colombia in India, said, Colombia stands a big chance of becoming second largest trade partner amongst Latin American and Caribbean countries. This year the trade between Colombia and India will USD 2 billions.

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ASSAM COMPANY LIMITED INDIA arrived in Colombia to

participate in the exploration of “Bloque El Triunfo”, as

informed by the Ambassador of Colombia in India, Juan Alfredo

Pinto.

An Indian company joins hands with Colombian firms to enter Colombian

Hydrocarbon Sector. New Delhi - February 22th, 2011. Communications Service, Embassy of Colombia in India.

A new Indian venture in the hydrocarbons sector in Colombia was announced this morning by the Ambassador of Colombia, Juan Alfredo Pinto, in New Delhi. The diplomat said that ASSAM COMPANY LIMITED INDIA is a medium scale company in the oil sector but it has a long tradition in India, since it began operations as the producer of the famous Assam tea in 1839, a time that India was still a British colony. The company, which also works in partnership with India's state oil company, ONGC and Reliance Petroleum, will invest in Colombia about US$ 8 million (estimated figures).

The Ambassador said new memorandum of understanding has been signed between ASSAM INDIA COMPANY LIMITED and Colombian company. It is a new proof of the confidence that our country has in India, where Colombia is known for its democratic stability, consistency in macroeconomic management and its positive environment for foreign direct investment.

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Cultural Affairs

Interview: Diplomat turns fiction writer to promote bilateral

relations 04/03/2011

New Delhi, Mar 4 (PTI) While most diplomats focus on building emphatic relations with politicians, bureaucrats and businessmen, a Latin American envoy posted in India is promoting bilateral relations by letting his creative juices flow and penning short stories. Juan Alfredo Pinto Saavedra, the present Ambassador of Colombia to India, has come up with a collection of ten short stories centered around the lives of the people in Latin America and Asia. Having Latin American characters against a multi-hued Asian setting, ''Stories of the Lotus'' is the English version of the recently-released Spanish book ''Flor de Loto'' written by the 57-year-old diplomat. "I thought why can''t we try and build a new way of creating good people to people relations between the two countries. Writing the book is a real way to integrate people. For long, we have focused only at the economic and political levels," he told PTI. Pinto, who assumed his office at New Delhi in 2007, sees the story book as an "extension of his role as a diplomat in India". "Over the years I realised that people of the two countries do not know much about each other. There is a high level of curiosity, but a book relating the two cultures was missing," he said when asked how the unique idea of writing came to him. "Since I am also the concurrent ambassador for Iran, Nepal, Sri Lanka, Bangladesh and Indonesia, I chose to bring in the entire Asian context, rather than limiting it to India," he said. Besides being an economist, a professor and a politician, Pinto has written 24 books on economics and is a regular columnist for newspapers in Colombia besides being a TV program commentator. The book, however, is his first attempt in writing fiction. "I am a writer and a sensitive man. Literature has been my passion," said the envoy who counts Rabindranath Tagore as one of his literary influences. .

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JNU: HispanOtsav

The Chief Guests

The Awards of Merit

Let’s Sing and Dance

The Colombian Way

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Facts and Figures

Colombian Automotive Sector

Economy - Colombia

Colombia has the fifth largest economy in Latin America with a GDP of USS 234 billion. During 2010 the Colombia GDP has increased 4.4%, overcoming the world economy projection of 3.4%

Trends in Automotive Sector - Colombia

• The automotive industry represents 6.2% of GDP, employs close to 2.5% of the occupied population and places Colombia as the fifth automobile manufacturer in Latin America.

• Dynamic automotive industry: average growth of close to 11% in manufacturing, 27% in exports and 15% in consumption.

• Automotive truck fleet in Colombia: 285.661 units

• Passenger buses fleet in Colombia: 205.793 units

• Colombia is the second largest producer or motorcycles in Latin America after Brazil

• A domestic production reach 85%, just 15.8% comes from imports of around 60 different companies

• Replacement rate :

• The average use of current vehicles in circulation is 15 years, even there are close to 33,000 vehicles with more than 50 years in circulation, a factor that makes Colombia an excellent market for spare parts for older cars

• M&A: SUPERPOLO S.A, the merger between Carrocerías Superior and the Brazilian company Marcopolo, and BUSSCAR DE COLOMBIA S.A., partner of Brazil´s BUSSCAR ÔNIBUS S.A. with a group of Colombian investors, are the companies that lead the national assembly of buses with sales of approximately US$ 53 million, while BUSSCAR with sales of US$ 19 million.

• Surge of Global Companies: Colombia has become the export platform for recognized foreign companies such as Yazaki, Michelin, Saint Gobain, Vitro, Good Year, Dupont, DANA Corporation, and AGP American Glass Products (Bullet proof glass), amongst others.

Opportunity Analysis

• Road infrastructure megaprojects will give the market greater competitiveness in highway transport, generating a bigger flow of new units in the market.

• Sustained growth in the unit volume in Colombia. In six years the number of automotive units increased by 56%.

• The auto parts supply allows assemblers to meet a minimum regional content to be able to access preferential tariffs in the agreements

• The auto parts chain has been identified by the government and private sector as a world class sector to be promoted and with huge potential.

• The country is the third largest automobile assembler in Latin America after Brazil and Mexico.

• Providing financial innovations will enable market penetration, significant expansion of finance for vehicles over the coming years will be possible, given the current low penetration of loans for new vehicles

The region has a population of 400 million people. Its GDP per capita increased from USD 3,160 per year in 1980 to USD 7,786 per year in 2009. The IMF reckons that GDP per capita will reach USD 10,770 per year in 2015. This should lead to a major expansion in the automobile market, particularly given the weaknesses of the railroad and urban mass-transit systems

Market Dynamics

• The increase in vehicle sales in Colombia and the Andean countries between 2002 and 2008 development of mass transport systems and the signing of commercial treaties to explore new export markets have leveraged this growth, reaching revenues of US$ 1.3 billion and generating close to 22,000 jobs in 2008.

• Between 2005 and 2009 Colombian auto parts exports increased 58%, going from US$ 277 million to US$ 439 million. Venezuela, Ecuador and Brazil amounted to 74% of total exports for that period.

• In the last four years auto parts imports have increased 39%, showing high demand for assemblers well as for the after market. Currently, there are 40 vehicle brands being commercialized in the country, stimulating internal consumption that is presently met by imports

Presence of Multinationals

Category Collaborations

Light Vehicles

GM – Colmotores

Renault – Sofasa

Mazda – CCA

Light Vehicle Trucks GM

Hino (Toyota)

Buses SUPERPOLO S.A, - Carrocerías Superior - Brazilian company Marcopolo, and BUSSCAR DE COLOMBIA S.A., partner of Brazil´s BUSSCAR ÔNIBUS S.A.

OEM Yazaki, Michelin, Saint Gobain, Vitro, Good Year, Dupont, DANA Corporation, and AGP American Glass Products (Bullet proof glass)

Others AGRALE (Brazil) ,since 2002

Indian Companies in Colombia

• The Colombian firm, Auteco, representatives of Bajaj Auto makers from India for several years, launched the famous Bajaj three wheeler auto rickshaw in Bogota

• Hyundai exports cars from India which are used as taxis in Colombia

• TVS and Royal Enfield have a strong presence in the two wheeler market.

• In September 2008, the first battery operated electric Indian car, REVA, was launched.

Benefits for Investors

• Assembly or Transformation Authorized Warehouses, that guarantee free tariff for auto-parts complying with the requirements of Andean origin, gets 30% deduction for companies which invests in the country for the acquisition of fixed productive real assets

• Competitive Free Trade Zones: Colombia has a Free Trade Zone regime that includes two schemes: Single Enterprise Free Trade Zones and Permanent Free Trade Zones

• Colombia offers Legal Stability Contracts to guarantee the terms for investment projects

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Special Report

Ambassador’s message for Japan We know how much you love Japan, so we wish you to have the strength and courage. We are sure about your professionalism in serving our compatriots. You will do right.

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India’s contribution to Colombia during rains and floods On January 18, 2011, Ambassador R.V. Warjri handed over a letter to the First Lady, Maria Clemencia Rodrigues de Santos, wife of President Juan Manuel Santos. The letter conveyed the donation by the Government of India to Colombia an amount of US$1 million as contribution to the relief efforts due to the floods which devastated parts of Colombia during the last few months. The First Lady is also the Patron of Colombia Humanitaria which coordinates the relief efforts.

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END OF DOCUMENT – DAKIA – APRIL 2011