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XMBA-36
Philip Menezes
Vinaikrishnan Nair
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India South Africa&
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Brief History of South Africa
South African history has been dominated by the interaction and conflict of severaldiverse ethnic groups
The aboriginal Khoisan people have lived in the region for millennia.
South Africans are descendants of immigrants, mainly from the Netherlands andBritain, as well as slaves from the East Indies, and there are many South Africans ofIndian and Chinese origin, they are the descendants of labourers who arrived in thenineteenth and early twentieth centuries.
South Africa was under an official system of racial segregation and white minorityrule from 1948 known as Apartheid, until its first egalitarian elections in 1994,
when the ruling African National Congress came to dominate the politics of thecountry.
Independence from the United Kingdom in 1931. Union of South Africa formed onMay 31, 1910 and Republic of South Africa declared on May 31, 1961
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India-SA- Historical Relationship
Export of Slave Labor to South Africa
Impact of Mahatma Gandhi
India worked consistently to put the issue of apartheid on the agenda of the
UN.
The African National Congress maintained a representative office in New
Delhi from the 1960s onwards.
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The Discovery of Diamonds
A person of British origin Daniel Jacobs came across a particular stonewhich his children were playing with.
The stone was eventually brought to the attention of the acting Civil
Commissioner at Colesberg, Lorenzo Boyes and it was found to be a
diamond, weighing twenty-one carats and amounting to the value of fivehundred pounds.
Thus, on 13 October 1867, diamonds were discovered in South Africa, with
the very first becoming known as the Eureka diamond.
By 1871, more diamonds were found in the vicinity of the present-day
Kimberley, leading to the establishment of De Beers Consolidated Mines
under the leadership of Cecil John Rhodes.
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National Heroes of South Africa
Nelson Mandela (also first South African president to be elected from 1994
to 1999)
Walter Max Ulyate Sisulu
Oliver Tambo
Joe Slovo
Desmond Mpilo Tutu
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Political System
The Republic of South Africa is a federal state.
South Africa is a constitutional democracy with a three-tier system
Consists of National government and nine provincial governments.
The constitution of South Africa was adopted in 1996 and implementedofficially on 4 February, 1997. Under the political system of South Africa,the President is the executive head of the state elected by the parliament fortwo five year terms.
The political system of South Africa has significantly evolved since theapartheid era.
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Quick Snapshot
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Political Relations
Indias consistent support to the anti-apartheid struggle.
A number of bilateral agreements have been concluded between the twocountries.
The India-South Africa Joint Commission at the level of Foreign Ministers wasset up in 1994 to identify areas of mutually beneficial cooperation.
Prime Minister of India Dr Manmohan Singh visited South Africa from 17-19th
October 2011 to attend the IBSA summit held in Pretoria on 18th October2011.
India and South Africa have a common approach on many global issues,including UNSC reform, the future of multilateralism, climate change, South-South Cooperation and multilateral trade negotiations.
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The economy of South Africa is ranked as an upper-middle incomeeconomy by the World Bank
Economic powerhouse of Africa, leading the continent in industrial output
and mineral production and generating a large proportion of Africa's
electricity.
Abundant natural resources, well-developed financial, legal,communications, energy and transport sectors, a stock exchange ranked
among the top 20 in the world, and a modern infrastructure supporting
efficient distribution of goods throughout the southern African region.
World-class and progressive legal framework. Legislation governing
commerce, labour and maritime issues is particularly well developed, andlaws on competition policy, copyright, patents, trademarks and disputes
conform to international norms and conventions.
The country's financial systems are sophisticated and robust. The banking
regulations rank with the best in the world, and the sector has long
been rated among the top 10 globally.
Economy Overview
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Some Analysis
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GDPGrowth Rate
The Gross Domestic Product (GDP) in South Africa expanded 1.4
percent in the third quarter of 2011 over the previous quarter.
Historically, from 1993 until 2011, South Africa's average
quarterlyGDPGrowth was 3.32 percent reaching an
historical high of 7.60 percent in December of 1994 and arecord low of -5.90 percent in March of 2009. South Africa
has a two-tiered economy; one rivaling other developed
countries and the other with only the most basic
infrastructure. It is therefore a productive and industrialized
economy that exhibits many characteristics associated with
developing countries, including a division of labor between
formal and informal sectors and an uneven distribution of
wealth and income. The primary sector, based on
manufacturing, services, mining, and agriculture, is welldeveloped.
The Gross Domestic Product (GDP) in India expanded 6.9 percent
in the third quarter of 2011 over the previous quarter.
Historically, from 2000 until 2011, India's average
quarterlyGDPGrowth was 7.45 percent reaching an
historical high of 11.80 percent in December of 2003 and arecord low of 1.60 percent in December of 2002. India's
diverse economy encompasses traditional village farming,
modern agriculture, handicrafts, a wide range of modern
industries, and a multitude of services. Services are the major
source of economic growth, accounting for more than half of
India's output with less than one third of its labor force.
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Inflation Rate
The inflation rate in South Africa was last
reported at 6 percent in October of 2011.
From 1981 until 2010, the average inflation
rate in South Africa was 10.00 percentreaching an historical high of 20.80 percent
in January of 1986 and a record low of 0.10
percent in January of 2004
The inflation rate in India was last reported at
9.36 percent in October of 2011. From
1969 until 2010, the average inflation rate in
India was 7.99 percent reaching an historicalhigh of 34.68 percent in September of 1974
and a record low of -11.31 percent in May of
1976. Inflation rate refers to a general rise in
prices measured against a standard level of
purchasing power.
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Business Confidence
In South Africa, business confidence eased to 38 in
the fourth quarter of 2011 from 39 in the third
of 2011. In South Africa, the RMB/BER (Rand
Merchant Bank/Bureau for Economic Research)Business Confidence Index measures the level of
optimism that senior executives in the companies
have about current and expected developments
regarding sales, orders, employment, inventories,
selling prices etc.
In India, business confidence declined to 145.2 in
July of 2011 from 145.3 in April of 2011. In
India, the NCAER (National Council of Applied
Economic Research) - MasterCard WorldwideIndex of Business Confidence measures the level
of optimism that people who run companies have
about the performance of the economy and how
they feel about their organizations prospects.
Survey incorporates four indicators: overall
economic conditions six months from now,
financial position of firms six months from now,investment climate and capacity utilization level.
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Unemployment Rates
The unemployment rate in South Africa was last
reported at 25 percent in the third quarter
of 2011. From 2000 until 2008, South
Africa's Unemployment Rate averaged 26.38percent reaching an historical high of 31.20
percent in March of 2003 and a record low of
23.00 percent in September of 2007.
The unemployment rate in India was last reported
at 9.4 percent in 2009/10 fiscal year. From
1983 until 2000, India's Unemployment Rate
averaged 7.20 percent reaching an historicalhigh of 8.30 percent in December of 1983
and a record low of 5.99 percent in December
of 1994.
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Commercial & Economic Relations
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Commercial & Economic Relations
Commercial relations have flourished since the establishment of diplomatic
relations in 1993.
On the trade front, value of bilateral trade has trebled.
Both sides agreed to work towards a target of USD 10 billion in bilateral
trade by 2012.
The trade target was revised to USD 15 billion by 2014 during the visit of
Commerce and Industry Minister in January, 2011 to South Africa as the
bilateral trade target.
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Trade Relation with India
India has become the 6th largest trading partner to the South Africa in AsiaRegion
Trade of more than US $2 billion in a year.
Sectors covering trade agreements
Technology
Telecommunications,
Small business enterprises(SMEs)
South Africa has set up the India-South African Commercial Alliance.
South Africa has also adopted the New Delhi Agenda for Cooperation.
Indo- South Africa Bilateral Trade potential to touch US$ 10 Billion.
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Figures on Bi-lateral Trade
Year 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011
EXPORT 1,526.87 2,241.61 2,660.75 1,980.28 2,058.50 3,985.02
IMPORT 2,471.80 2,470.14 3,605.35 5,513.58 5,674.50 7,140.55
TOTAL
TRADE
3,998.67 4,711.75 6,266.10 7,493.87 7,732.99 11,125.57
Source: Ministry ofCommerce in USD Million
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Indian Industries in South Africa
Large Indian companies including Tata Group (automobiles, IT, hospitality, and ferrochrome plant)
Indian Oil Corporation,
Apollo Tyres, Bharat Biotech,
Ashok Leyland, Murugappa Group,
UB Group (breweries, hotels), Mahindra (automobiles),
Pharma Companies Ranbaxy & CIPLA
Indian banks State Bank of India
Bank of Baroda Bank of India
EXIM Bank
ICICI Bank
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South African Industries in India
SAB Miller (breweries)
ACSA (upgradation of Mumbai airport)
SANLAM and Old Mutual (insurance)
ALTECH (set top boxes)
Adcock Ingram (pharmaceuticals)
Rand Merchant Bank (banking).
The International Marketing Council (IMC) of South Africa has an office in
Mumbai.
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Future Trade Relations
Exports from India to South Africa Vehicles and components
Transport equipment
Drugs and pharmaceuticals
Engineering goods
Footwear,
Dyes and intermediates
Chemicals
Textiles
Rice
Gems and Jewellery
Import from South Africa to India Gold,
Steam coal
Copper ores , phosphoric acid, manganese ore, aluminum ingots & other minerals.
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Thank You
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