Indirect trade with India unhealthy

CAMBODIA’S indirect trade and investments with India are possibly worth almost five times more than its direct economic activities, a situation deemed “unfavourable” to the country, an industry expert said yesterday. Direct trade and investments between the two countries hit a record $112 million last year, 20 per cent more than 2011, said Indian Chamber of Commerce’s (ICC) President, Debasish Pattnaik. But indirect activities, conducted through a third-party, “could be easily worth around $500 million,” said Manish Singhal, assistant secretary-general of the Federation of Indian Chambers of Commerce and Industry (FICCI). … While India also largely trades indirectly with countries like Myanmar and Vietnam, Cambodia’s ratio of direct versus indirect activities is “very, very unfavourable”, Singhal said. Without a middleman, there is “greater possibility of business growth”, he said, because importing costs can drop eight to 15 per cent. Also, when problems arise, having direct connections with the exporter would enable better solutions, because “the middleman is not your friend”, he added. Such indirect activities, said Dinesh Pattnaik, is one reason why India’s direct trade and investments with Cambodia remain low, compared to that with ASEAN, valued currently at about $80 billion. …

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