India-Serbia Commercial Relations
In 2015, bilateral trade between India and Serbia amounted to US$ 145.6 million with Indian exports at US$ 140.0 million and imports at US$ 5.6 million. India's top exports and imports are depicted below. Indian companies like TAFE Ltd, Mahindra & Mahindra, Sonalika Tractors, Jain Irrigation, Jet Airways, Embassy Group, Himalaya Herbal, Panacea Biotech, Maharishi Ayurveda, Ranbaxy Pharmaceuticals, etc have a presence in Serbia. Though the current trade levels are low, a large potential exists for enhancing trade in the near future. Recent bilateral trade figures are given below (in US$ Million):
2. India-Serbia Joint Economic Committee (JEC) held its second meeting in October 2014 wherein both sides agreed to boost cooperation in agriculture, automotive industry, healthcare, pharmaceuticals, science, information technology, infrastructure and tourism to encourage closer cooperation. The industry was encouraged to participate in trade fairs in India and Serbia. Serbia expressed interest in establishing cooperation in the areas of energy, mining, geological exploration, environmental protection, education, setting up of bilateral agricultural centers for development of technologies to increase production and exchange of experience in the field of establishing Public Private Partnerships. India signed an agreement on Serbia’s accession to WTO in 2013.
3. The necessary bilateral instruments to promote trade and investment are already in place namely, Bilateral Investment Promotion and Protection Agreement (BIPA), Double Taxation Avoidance Convention (DTAC), Trade Agreement (MFN status), Tourism Agreement, Air Services Agreement, Agreement on Agricultural Cooperation, Agreement on Cooperation in Science and Technology, etc.
4. Some major fiscal and structural reforms undertaken by the Serbian government have resulted in significant improvement in the economic situation and business environment of Serbia. In February 2015, the International Monetary Fund (IMF) approved a 3-year Euro 1.2 billion Stand-By Arrangement (SBA) for Serbia with three main objectives, namely, restoring public finances’ health; increasing the stability and resilience of the financial sector; and implementing comprehensive structural reforms. The third review of the SBA was conducted in December 2015 where IMF acknowledged Serbia's improved economic outlook, higher exports, increase in domestic demand, low prices of oil and stronger-than-expected private sector wages. Under the new Law on Privatization adopted by the Serbian Government in 2015, the deadline for privatization of 17 strategic companies was extended by one year until June 2016. The Law applies to major companies including Agricultural Complex Beograd (PKB), Azotara mineral fertilizer plant, Galenika Pharmaceuticals, MSK chemical factory, Petrochemicals, FAM chemicals, Trajal factory, Jumco textiles, RTB Bor, Resavica Mine, Prva Petoletka metallurgy, FAP truck manufacturing and Ibarbus bus manufacturing which are of great importance to the Serbian economy. In November 2015, a new Law on Investments was adopted with the aim of improving the investment conditions encouraging direct investment in order to strengthen economic development, increasing employment and social prosperity, equalizing treatment of domestic and foreign investors, creating a more attractive business environment for domestic and foreign investors. The new Law on Investments is expected to change the investment environment in Serbia for the better. On 14 December 2015, Serbia opened the first two Chapters in their accession negotiations with the European Union thereby officially beginning the process of alignment of local standards and norms as per those of EU. This will lead to a significant improvement in the business environment of Serbia. The prospect of Serbia's integration into the European Union and a steady growth in foreign direct investment inflows resulted in a 30% increase in the volume of foreign direct investment in Serbia in 2015. Serbia is gradually becoming more and more open to international trade
5. More than 50 Serbian companies visited India in 2015 to provide technical support to Indian companies and institutions, particularly in the ICT sector. In addition, a delegation from the National Petroleum Committee of Serbia consisting of Prof. Petar Skundric, Chairman and Prof. Goran Radosavljevic, General Secretary participated in the World Petroleum Council (WPC) Meetings held at New Delhi (Oct 2015). A 2-member team from the Serbian R&D company Sentronis AD were invited by Bhabha Atomic Research Centre (BARC) (Nov 2015) for installation and commissioning of 3D magnetic field mapping system purchased by BARC from Sentronis AD. An official of Serbian Ministry of Agriculture and Environmental Protection attended the exhibition 'AgriMach India 2015 organized by FICCI in partnership with Ministry of Agriculture in New Delhi (Dec 2015). Prof. Dr. Branko Matovic and Dr. Biljana Babic from the Vinca Institute of Nuclear Sciences, Belgrade were invited by IIT-Madras (Jan 2016) for assisting their Department of Metallurgical & Materials Engg. in performing some experiments and deliver scientific lectures.
6. Serbian companies have been availing of Indian hospitality packages to participate in (i) India Engineering Sourcing Show (IESS); (ii) India International Handwoven Fair (IIHF) (iii) Gujarat International Handloom & Handicraft Meet “GURJARI” (iv) GET INDIA 2015 Seminar (v) Indian Fashion Jewellery & Accessories Show (IFJAS) (vi) INDIASOFT 2016- IT Exhibition and Conference (vii) NASSCOM India Leadership Forum 2016. Serbian companies also participated in (i) Aero India 2015 (ii) India Carpet Expo 2016 (iii) India Shoe & Accessories Forum (ISAF 2016) (iv) International Garment Fair (v) Defexpo 2016 (vi) Global Exhibition on Services 2016. Serbian models are in great demand by Indian fashion companies
7. GOI flagship programmes like Make in India, Digital India, Smart Cities Projects, etc. were promoted at the 3rd EnerTech Balkans Conference 2015-Balkan Renewable Energy Programme (Mar 2015); Conference on Women Entrepreneurs (Sep 2015); Digital Conference (Sep 2015); Conference on HR Serbia (Nov 2015); Conference on Renewable Energy-Serbia Goes Green (Apr 2016). A Workshop on "India - National Economic Projects & Opportunities for Collaboration" was jointly organized (Sep 2015) with the Serbian Chamber of Commerce and Industry. RITES Ltd. visited Serbia from 7-9 Apr 2015 to explore participation in Serbian infrastructural and road projects. Serbian subsidiaries of Indian agri-machinery companies such as TAFE, Mahindra and Sonalika have regularly participated in the Novi Sad International Agricultural Fair (May).
8. Indian Technical and Economic Cooperation (ITEC): More than 130 Serbian nationals have been imparted training under the ITEC Programme since it was extended to Serbia in 2008 in a wide and diverse range of skills and disciplines including IT, ICT, Expenditure Management, Entrepreneurship, WTO, Banking & Finance and Sustainable Development, Rural Development, Renewable Energy, Climate Change, English proficiency, etc. The Serbian institutions have shown a great interest and enthusiasm towards ITEC training courses and feedback received from trainees is very encouraging.
9. Major Indian Investments in Serbia are as follows:
10. The following sectors have the potential for enhancing India-Serbia trade & investment:
(a) Retail Medicaments - This formed the largest import segment in Serbia’s foreign trade in 2015 at USD 1.9 billion and was also the biggest segment in India-Serbia bilateral trade. Indian investment in Pharma sector in Serbia is a priority.
(b) Metals (Refined copper, wire & ores, aluminum unwrought, iron ores)- Third largest import segment in Serbia’s foreign trade in 2015 at USD 1.8 billion and the second largest segment in India-Serbia bilateral trade.
(c) Petroleum products- Serbia has a developed petroleum industry which is importing most of the necessary raw materials and equipment. Thus it might offer a great export opportunity for Indian companies. Serbia has sought strategic partner from India in HIP Petrohemija, petrochemical complex in Pancevo.
(d) Agro products (coffee, bananas, tobacco and spices)- India is the second largest supplier of coffee to the Serbian market. It appears worthwhile for Indian companies to also consider exporting products such as mangoes, bananas, raw tobacco and spices.
(e) Agro chemicals (Fertilizers, Herbicides, Fungicides)- Agriculture & food processing constitute one of the main segments of the Serbian industry with annual production reaching USD 6.6 billion. Good opportunities exist for export of agro-chemicals.
(f) Mobile phones- Indian manufacturers with competitive prices may have an opportunity to gain market share.
(g) Petrochemicals (Polyethylene & Polypropylene)- Serbia imports large quantities of these petrochemicals annually.
(h) Personal care products- Local consumers are increasingly looking for products of natural origin for personal care which is India's speciality.
(i) Tanned leather- Serbia has a developed shoemaking and leather furniture Industry and most of the raw leather is imported from other countries.
(j) Particle wood board- Serbia has a well developed furniture industry which imports particle wood board.
(k) Ayurvedic and herbal products- Local consumers are increasingly looking for products of natural origin for healthcare.
(l) Science &Technology- Serbia is looking for technology transfer in various industry segments and there is potential for investment in science & innovation.
(m) Infrastructure- Investment in infrastructure is a high priority for the Serbian government with 175 current infrastructure projects totaling EUR 15 billion. The projects include construction of roads, bridges, railways, water transport infrastructure, air traffic and municipal infrastructure. Serbia plans to attract foreign investment and complete most of the important infrastructure projects by 2017 including the EU highway Corridors X and XI. More details available at www.mgsi.gov.rs/cir/dokumenti/projekti.
(n) Construction- An emerging local real estate market, infrastructure development projects and FTA with Russia are key drivers for development of this industry in Serbia.
(o) Waste management- There is a real scope for investments in this sector.
(p) Renewable energy- Favorable conditions exist for energy production from almost all types of renewable energy sources in Serbia. The market is yet to be saturated and is open for new investments.
(q) Power projects - Upgrading power infrastructure is one of the key priorities for Serbia.
11. Information on major Trade Fairs in India and Serbia:
Fairs in Serbia
Fairs in India
The number of Business visas to India showed year on growth of 22% in 2015.