A Golden prospect for Indian investors: Gemma Mbegabolawe, ED Botswana Investment & Trade
Botswana is a mid-sized country of just over 2 million people, one of the most sparsely populated countries in the world. It is located at the heart of Southern Africa and surrounded by prominent neighbors including Namibia, Zambia, Zimbabwe and South Africa. It attained its independence from Colonial rule on September, 30th, 1966.Formerly it was one of the poorest countries in the world—with a GDP per capita of about US$70 per year in the late 1960s—Botswana has since transformed itself into one of the world’s fastest-growing economies. The economy is dominated by mining, cattle and tourism. Botswana boasts a GDP per capita of about $18,825 per year as of 2015, which is one of the highest in Africa. It consistently held uninterrupted democratic elections post independence.Botswana established bilateral relations with India soon after Botswana gained independence 50 years ago. Relations between the two countries have been cordial and are underpinned by mutual respects by the two sisterly countries.Gemma Mbegabolawe, Executive Director International Business – Botswana Investment and Trade Centre in Mumbai highlighted best of opportunities available for Indian investors in Botswana in candid talk with senior journalist Sitaram Mewati.
Why to invest in Botswana?
Every businessman or industrialists of the world looks for better facilities, best returns, good healthy environments, good tax rebates, good work force, safe and secure countries to launch their business. Botswana has it all, it is a perfect destination offering plethora of the opportunities to establish their business. All sorts of opportunities are made available under one umbrella in Botswana for investors to tap.
What are the investment opportunities in Botswana?
There are enormous opportunities available for business and investment in several sectors. Government is currently driving for foreign direct investment in specific sectors like mining and mining beneficiation, agriculture, infrastructure, education, energy, ICT, Finance, manufacturing and health. The Government is aggressively working towards the diversification of the economy to reduce the reliance on the mining sector, especially diamonds. In fulfilling this, the country is promoting manufacturing sector, with the aim to reduce the import bill in order to improve the standard of living of ordinary Botswana as well as create employment.
What are the incentives offered for Indian Investment?
There are unlimited investment and trade opportunities that can be exploited by Indian companies for mutual benefit. Botswana offers a lucrative basket of incentives in attracting and retaining investors. These incentives include no foreign exchange controls, no restrictions on business ownership, comparatively low tax rates at 15% for manufacturing, 22% for other sectors and 25% for income tax, remittance and full repatriation of profits and dividends, duty-free as well as import of machinery and equipment for manufacturing purposes. The most attractive term is 5 to 10 years tax holidays. So it’s a golden opportunity for Indians to start their business in Botswana.
What are the government policies for investors?
The Government’s policy is orientated towards a sustainable growth and win-win situation for both investors and the country. There are policies in place to protect both the investors and the labor force. It ensures that there is strict adherence to the rule of law at the same time securing investors’ investments. Botswana has zero tolerance for corruption, it has been consistently rated as the least corrupt country in Africa by Transparency International and ranked among the world’s most attractive investment location by New York University’s Altman’s Baseline Profitability Index (BPI). Botswana has the highest sovereign credit rating, being named the 2nd Freest Economy in Africa with one of the fastest growth rates in per capita income in the world.
Is there any Special Economic Zones?
Yes, indeed. Globally, most of the countries offer best prospects for global investors to attract them and to be a part of economic growth of both countries. To offer finest investment opportunities, the Government of Botswana adopted Special Economic Zones Policy in order to attract foreign direct investment. The policy is designed to to attract world class domestic and foreign investors. This would be on the basis of world class infrastructure, state of the art technology, beneficial inter-sectoral linkages and agglomeration economies of scale, specially trained manpower with relevant modern industry skills and targeted economic incentives.
What is the market access to investors in Botswana?
Botswana has a unique feature for the Global investors that can culminate into a fruitful and lucrative business opportunities. Botswana is in the centre of the Southern Africa Development Community (SADC), which is made up of fifteen countries with a population of over 293 million people. SADC Countries have a combined GDP of more than USD 668.2 billion. SADC Free Trade Area was launched in 2013. It provides zero tariffs for 85% of goods traded among Member States. It is also a member of the Southern African Customs Union (SACU), the oldest Customs Union in the world. Through SACU, Botswana is part of a number of the trade agreements, which include; African Growth and Opportunity ACT (AGOA), an arrangement between some African countries with the US; SACU MERCOSUR with Brazil, Argentina, Paraguay and Uruguay as well as SACU and European Free Trade Agreement with Switzerland, Iceland, Norway and Lichtenstein.Botswana is also signatory to the SADC – Economic Partnership Agreement with the EU which offers duty free quota free access to the EU. Botswana has also signed the Continental Free Trade Agreement under the African Union.
What types of relation Botswana enjoys with India?
Soon-after gaining independence 50 years ago, relations between India and Botswana have been cordial and are underpinned by mutual respects. Both countries have exchanged high levels visits over the years playing a very significant role in solidifying relations between the two countries. Currently there are around 30,000 people ofIndian origin in Botswana. India continues to support Botswana in her development endeavors through government to government assistance but also through facilitation of trade and investment by the private sector in the economies of both countries. Both countries share a strong cultural heritage, a desire to develop their economies in order to eliminate poverty and diseases and ultimately enter the ranks of the developed world.
What type of import and exports takes place in both countries?
Botswana exports to India are mainly made of rough diamonds. Diamonds bought by Indian polishing and cutting companies through the Government owned Okavango Diamond Company constitute about 70% of its total sales. Indian companies export a various number of finished products to Botswana, including textiles, pharmaceutical products and automobiles. The Botswana/India relations are underpinned by more than a dozen agreements covering trade and investment to financial sector among other areas.