INDIA-SWEDEN COMMERCIAL & ECONOMIC RELATIONS
1. Mutual economic interests have emerged as the driver of the relationship between India and Sweden with growth in bilateral trade, which crossed US$2 billion in 2009-10 and increased to US$2.4 billion in 2014-15. Two-way investments are also expanding. There are complementarities in the areas of cutting edge technologies creating good potential for bilateral collaboration in key areas like green technologies, renewable energy, smart infrastructure, healthcare and defence.
2. During the landmark visit by the President of India Shri Pranab Mukherjee to Sweden from May 31 to June 2, 2015, accompanied by a large business delegation, the areas which were highlighted for future cooperation included collaboration in India’s Smart Cities programme, healthcare and innovation (Sweden is one of the world’s leading innovative nation, generally ranked among the top three according to different global indices). The President had a closed-door Round Table with CEOs of major Swedish companies and addressed a large gathering on the subject of "India-Sweden Partnership – Co-creating a Brighter Future".
3. The momentum and substance that had been imparted to India-Sweden relations by the visit of the President of India, was further enhanced by Prime Minister of Sweden Stefan Löfven’s visit to India on February 13-14, 2016, with the largest business delegation that he has led to any country, to participate in the ‘Make in India Week’. He was accompaniedby a number of senior officials including the State Secretary in Prime Minister’s Office,the State Secretary in the Ministry of Defence and the State Secretary in the Ministry of Enterprise and Innovation.Prime Minister of India Narendra Modi and Prime Minister Löfven, along with the Prime Minister of Finland, jointly inaugurated the Make in India Centre on February13. Prime Minister Modi and Prime Minister Löfven visited the Swedish pavilion, which was the largest foreign country pavilion in the Centre event.In a Joint Statement, the two leaders welcomed the creation of an India-Sweden Business Leader Round Table; endorsed the creation of a new Joint Working Group on Digital Technologies and Economy; took note of the synergies in the field of innovation and Prime Minister Löfven extended an invitation to Indian delegation to visit Sweden for a bilateral Sweden-India Innovation Dialogue; acknowledged the potential for successful collaboration in defence and agreed that under the rubric of ‘Make in India’, cooperation possibilities between their respective defence industries could be identified and taken forward appropriately, including in the field of aviation; and both sides recognized that enhancing awareness of each other’s cultures boosts people-to-people ties and welcomed reciprocal festivals of ‘Namaste Stockholm’ in Sweden and Sweden-India Nobel Memorial Week in India.On February14, Prime Minister Löfven and Finance Minister of India ArunJaitley addressed a Round Table of Sweden and Indian CEOs; nearly 30 Indian CEOs participated in the meeting , representing diverse sectors while from the Swedish side, besides the senior leadership from about 20 companies, Director Generals and CEOs from key agencies such as Vinnova, Swedish Energy Agency, Swedish Post & Telecom Authority, Swedish Export Credit Corporation, Swedish National Export Credit Guarantees Board and Swedfund also participated.Prime Minister Löfven also met the Chief Minister of Maharashtra and the two dignitaries witnessed the handing over of the first Volvo Hybrid Bus to the Navi Mumbai Municipality. Prime Minister Löfven extended an invitation to the Chief Minister of Maharashtra to visit Sweden.While Prime Minister Löfven returned to Stockholm from Pune, State Secretary for Enterprise & Innovation Oscar Stenström and members of the Swedish business delegation had meetings on February 14 and 15 with the Minister of Communications & Information Technology, Mr. Ravi Shankar Prasad; the Minister for Road Transport, Highways & Shipping, Mr. Nitin Gadkari; and the Minister for Heavy Industries & Public Enterprises, Mr. AnantGeete. They also had a round-table with the Secretary, Department of Industrial Policy & Promotion (DIPP), Mr. Amitabh Kant; and the incoming Secretary of DIPP, Mr. Ramesh Abhishek. On 15th February, State Secretary for Defence Mr. Jan Salestrand had a meeting with the Minister for Defence Mr. Manohar Parrikar.
4. The Swedish Minister for Housing, Urban Development and Information Technology, Mr. Mehmet Kaplan, visited India from October 13-18, 2015, when collaboration in the field of urban development emerged as a highly potential area. As part of the ‘MoU on Cooperation in the field of Sustainable Urban Development’, signed during the State Visit of the President of India in June 2015, First Meeting of the Joint Working Group was held in New Delhi on 14 October 2015 during Minister Kaplan’s visit. Also, the Minister visited Maharashtra on 17 October 2015 and discussed with the Maharashtra Government for cooperation in waste management, digital urban land management and urban transport capacity building.
5. A number of bilateral Institutional Dialogue Mechanisms and Agreements are in place to foster cooperation in different areas. These include Avoidance of Double Taxation Agreement and Bilateral Protection Agreement (BIPA) which provides the necessary umbrella for close economic collaboration. Another important MOU is the MOU on Cooperation in the field of Healthcare and Public Health signed in February 2009 which provides mutually beneficial interaction between concerned agencies on both sides. There are also MOUs in the key areas of defence, environment, science &Technology, health and renewable energy. Regular meetings are held to review and foster cooperation in these areas. A Bilateral Social Security Agreement was signed on November 26, 2012. Six intergovernmental Agreements/MOUs were signed during the Presidential visit in June 2015 pertaining to Sustainable Urban Development; Micro, Small and Medium Enterprises; Visa Exemption for Diplomatic Passports; Polar and Ocean Research; Ageing and Health; and Pharmaceutical products. During the ‘Make in India Week’, the Governments of India and Sweden signed a Memorandum of Understanding on Technical Cooperation in Rail Sector on 15 February 2016, and the Swedish specialty chemicals group ‘Perstorp’ signed an MoU with the Maharashtra Industrial Development Corporation (MIDC) on 14 February 2016 aimed at evaluating opportunities for building a world-scale pentaerythritol plant in India.
6. The leading institutional mechanism of inter-Governmental dialogue between India and Sweden is the Joint Economic Commission (JEC) at the level of the Ministers of Commerce and Industry. The last round (17th) was held in Stockholm on January 30, 2015. As the Minister for Commerce and Industry had to cancel her visit at the last minute, it was chaired by Mr. Amitabh Kant, Secretary, Department of Industrial Policy and Promotion, Ministry of Commerce and Industry on the Indian side and Mr. Oscar Stenström, State Secretary inMinistry of Enterprise, on the Swedish side.
7. India is Sweden’s 19th largest export market and third largest trade partner after China and Japan in Asia. The main Swedish exports to India are communication equipment, motor vehicles, paper & pulp products, pharmaceuticals, chemicals and engineering products. The main items of Indian exports are garments, textiles, chemical products, food products, and semi manufactured and manufactured goods.
8. As per Department of Commerce, Ministry of Commerce and Industry, Government of India, bilateral trade data is as follows:
Department of Commerce
Note:The country's total imports (S.No.6) since 2000-2001 does not include import of Petroleum Products (27100093) and Crude Oil (27090000)
9. According to the International Trade Centre figures, in 2013, Indian service exports to Sweden were US $778 million and Swedish service exports to India were US$611 million.
10. Swedish companies came to India even before it gained independence. Ericsson, Swedish Match (WIMCO), SKF and ASEA (later to become ABB) have been in India from the 1920s. Since then other Swedish companies like Atlas Copco, Sandvik, Alfa Laval, Volvo, Astra Zeneca, SAAB, etc. have invested in India. Other leading Swedish MNCs such as transport solution provider Scania and the hygiene and forest products company SCA are among the more recent entrants. Retail giants IKEA and H&M have also made significant investments in India. At present there are over 170 Swedish joint ventures wholly owned subsidiaries in India. According to the statistics of the DIPP, FDI inflow into India from Sweden for the period April 2000 to May 2015 is US $1.1 billion, making it the 19th largest investor, accounting for 0.43% of total FDI inflows in the country. Sectors that have received the largest shares of Swedish investments in India are Automobile Industry (33%), Industrial Machinery (15%), Miscellaneous Mechanical & Engineering Industries (10%), Electrical Equipment (7%) and Metallurgical Industries (5%).
11. Over the last decade, Indian investment in Sweden has also increased. There are over 70 Indian companies including IT companies currently present in Sweden.There are over 40 Indian IT companies in Sweden. Indian pharma and biotech companies like Dr. Reddys, Biocon, Kemwell and CadilaPharma have formed collaborative relations in Sweden. Bharat Forge, acquired the Swedish firm ImatraKilsta AB in 2005 with a workforce of over 500 employees. In 2006, Wipro acquired 100% equity of the Sweden-based Hydrauto Group AB which produces hydraulic cylinders. In May, 2011 India’s Crompton Greaves acquired Emotron which develops electric motors in Helsingborg. In April, 2011 Aditya Birla Group acquired the Swedish specialty pulp maker and bio refinery company DomsjoFabriker for SEK 2.1 billion. In July, 2012, Indian Telecom co. Altruist Technologies has purchased Swedish Telecom companyTeligent. In October 2015, it was announced that Volvo Trucks had reached an agreement to divest its external IT operations to HCL Technology for a cash payment of US $138 million. According to rough estimates the cumulative Indian investment in Sweden is currently in the range of US$ 700-800 million.