INDIA-NETHERLANDS  BILATERAL TRADE & INVESTMENT

Bilateral Trade

 The total two-way trade between India and Netherlands has been steadily increasing. It crossed € 1 billion mark for the first time in 1997, the € 2 billion mark in 2005, the € 3 billion mark in 2007, the € 4 billion mark in 2009 and the € 5 billion mark in 2010. Total bilateral trade with the Netherlands in 2010 showed an increase of 23.59 %.  Total trade between India and the Netherlands has grown over 80.72% in the period 2006 - 2010. Exports from India to the Netherlands in these five years have increased 97.57 % while Dutch exports to India increased by 55.34 %.   The Balance of Trade has been in India’s favour since 1992. In 2010, it stood at € 1573.97 million in favour of India. 

The progression of bilateral trade in the period 2000 - 2010 is given below:

                                                                        India – Netherlands Trade (in million Euros)

            (*Provisional figures : CBS)

 Major Indian Exports to the Netherlands

The largest group in Indian exports to the Netherlands was that of mineral products which accounted for 37.21 % of total exports. The products under this group are mineral fuels and mineral oils (36.27 %).

Machines; electronic goods; sound recorders & reproducers accounted for 16.73 % of Indian exports. Under this heading, the product group electrical machinery equipment was the largest group and accounted for 13.15% of India’s total exports to the Netherlands. The main products exported under this heading are discs for laser reading (CD/CDR/CDRW/DVDR/DVDRW); static converters; starter motors; lighting and visual signaling equipment; capacitors/resistors; printed circuits; starter motors; electrical elements & batteries; wires/cables; diodes/transistors; filament lamps; circuit breakers; electromagnets etc.

The third largest group of products in Indian exports to the Netherlands during 2009 was that of Textile fabrics & textile goods accounted for 10.99 % of Indian exports to the Netherlands during 2010. Within this group, apparels & clothing accessories accounted for about 8.41 % of the total exports to the Netherlands followed by made-up textile articles (1.51%).

The fourth largest group in the Indian exports to the Netherlands during comprised of products of the chemicals and related industries (6.79%), comprising mainly of organic chemicals (2.79%).

The fifth largest group in the Indian exports to the Netherlands during comprised of transport equipment (5.31%) in which the largest component was that of vehicles other than railway or tramway rolling stock (5.29%)

The sixth largest group in the Indian exports to the Netherlands was that of products of vegetable origin (4.75%) of which edible fruits and nuts (2.21%) formed the largest component. 

The above groups were followed by (a) non-precious metals & products (3.93%), comprising mainly of iron & steel and articles thereof (2.36%); (b) products of the food industry (2.73%); (c) plastics, rubber & products thereof (2.46%);           (d) skins, leather & products (2.04%), comprising mainly of leather goods (1.77%); (e) footwear, headgear etc (1.87%); and (f) live animals & products of animal origin (1.29%), mainly comprised of marine products (1.26%)

Growth Products in Indian Exports 

Besides products listed above, there were a number of other products that were exported from India in substantial amounts to the Netherlands and have a high growth potential. These products are: pharmaceutical products (€ 54.98 mln); tobacco & manufactures (€ 47.04 mln); furniture (€ 36.92 mln); preparations of vegetables, fruit, nuts or other parts of plants (€ 29.58 mln); and articles of stone, plaster, cement etc (€ 16.78 mln);

            There is also potential for further increase in the following products: textiles & garments, especially in the high-end products; electronics & computer software; light engineering products like bicycles, light commercial vehicles, tractors and parts thereof; sports goods.

 Major Indian Imports from the Netherlands

During 2010, the leading product groups imported by India from the Netherlands were: (a) Machines; electronic goods; electrical machinery (26.24%), products under this group included radio and television transmitters; ballasts for tubes, transformers, etc; circuit breakers; (b) Products of the chemical and related industries (20.91%) of which miscellaneous chemical products (7.14%), organic chemicals (4.94%) and pharmaceutical products (4.75%) formed the largest components; (c) Non-precious metals and their products (17.72%) of which Iron & steel (12.65%) formed the largest component; (d) Optical, photographic, cinematographic, measuring medical or surgical instruments and accessories (10.33%), including: photocopier machines and parts; x-ray equipments; medical prostheses; navigation instruments and binoculars; (e) plastics, rubber and products thereof (8.48%) and (f) wood pulp, paper and carton (4.74%).

Dutch Investments in India

            The Netherlands ranks 5^th in the list of countries in terms of cumulative FDI inflows into India during the period April, 2000, to March, 2011, with fresh inflows, not including reinvestment of dividends etc,  amounting to US $ 5.7 billion which was 4 % of total inflows into India during the above period. A large number of Dutch majors like Philips, Royal Dutch/Shell, Unilever, ING, Rabobank, KLM, Akzo Nobel and others have a major presence in India in important sectors of the economy and have been steadily planning additional investments to expand their operations. At present there are more than 100 Dutch companies that have a presence in India.

Indian Investments in the Netherlands

            The Netherlands is also gradually becoming an attractive destination for investments from India and figures amongst the top destinations. The Government of India cleared proposals worth about $ 11.463 bln for investments by Indian organizations in the Netherlands during the period 1996 - 2010.  Some of the big corporate houses from India, like TCS, HCL, Wipro, Infosys, Satyam, Moser Baer, Safal, Suzlon, ONGC Videsh, to name a few, have already based their Europe-wide operations and have impressive business portfolios in the Netherlands. There has also been some M&A activity with acquisitions like that of Corus by Tatas, Dutch tyre maker Vredestein by Apollo Tyres and Nederlandse Radiateuren Fabriek (NRF) by the Indian firm Banco Products.

Bilateral Economic & Trade Agreements

India and the Netherlands have signed the following agreements:  (1) An Agreement on Avoidance of Double Taxation (July, 1988) and (2) Bilateral Investment Protection Agreement (November, 1995). Apart from these, the Federation of Indian Chambers of Commerce & Industry (FICCI) and the Dutch employers’ association, VNO-NCW, have an agreement to promote bilateral trade and economic relations (February, 1982) which was renewed in the form of a fresh MoU and signed in November, 2008, in the presence of Shri Chidambaram. The Confederation of Indian Industry (CII) and the VNO-NCW also have a similar agreement (January, 2000). In February 2004, the two countries signed a Memorandum of Understanding on promotion of Investments. An MoU on cooperation between India and the Netherlands in the field of ports, maritime and logistics was signed during the visit of Dutch Minister for Transport, Public Works and Water Management to India in February 2008. This was extended for another period of three years in May, 2011. An MoU on cooperation in the field of Science & Technology was signed in March, 2008, during the visit of Indian Minister for Science & Technology and Earth Sciences.  A Social Security Agreement between India and the Netherlands was signed between the two governments in New Delhi in October 2009.

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June, 2011

Embassy of India

The Hague

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Comparison of Exports from India to the Netherlands during the period 2006 - 2010

 (HS system of classification)

 All values in 000’s Euros