India has intensified its diplomatic efforts to enhance trade relations with Kenya, as New Delhi prepares to send top envoys for crucial discussions in September.
These talks come at a time when India's trade with Kenya has hit a snag, despite the Asian giant’s ambitious goal of doubling its trade with African nations to $200 billion (Ksh25.8 trillion) by 2030.
The upcoming Joint Trade Council (JTC) meetings with Kenya and Tanzania are expected to be pivotal in addressing the issues hindering smooth trade flows.
Kenya, which stands as India's second-largest trading partner in Africa after Tanzania, has seen a significant surge in the volume of trade this year.
Data from the Kenya National Bureau of Statistics (KNBS) reveals that the first quarter of 2024 recorded the highest export volume for Kenya to India since 2022, with figures reaching Ksh33.431 billion.
However, imports from India have seen a decline, dropping to Ksh720.06 billion, down from Ksh880.86 billion recorded between April and June 2024.
This trade stagnation has been a cause for concern in New Delhi. Procedural obstacles, administrative and bureaucratic delays, and stringent standards imposed on imports have been cited as major barriers.
These issues have not only slowed the flow of goods between the two nations but also hampered India’s broader economic goals on the continent.
In a bid to tackle these challenges head-on, India’s Commerce and Industry Ministry has been actively consulting with various industry councils, ministries, and departments. The inter-ministerial consultations, planned ahead of the September JTC meetings, are expected to focus on removing these obstacles and exploring new opportunities to boost trade.
Africa, and specifically Kenya, is seen as a critical market for India’s diversification efforts, and the success of these talks could be a turning point in their bilateral trade relations.
The renewed push for better trade agreements follows Indian Prime Minister Narendra Modi’s visit to Kenya in December last year, where he and Kenyan leaders signed five memoranda of understanding aimed at enhancing bilateral relations.
During the visit, both sides pledged to address non-tariff barriers and market access challenges that have hindered the full potential of their trade relationship.
As part of its renewed focus, the Indian government has sought detailed input from the industry on tariff and non-tariff barriers affecting trade with Kenya. Specific issues, such as regulatory challenges and sanitary and phytosanitary (SPS) measures, are under scrutiny as New Delhi looks to identify and address sector-specific problems.
India’s trade portfolio with Kenya is diverse, with exports ranging from petroleum products, pharmaceuticals, and machinery to cereals, vehicles, and organic chemicals. Conversely, Kenya’s exports to India include tea, coffee, soda ash, edible vegetables, and a variety of metals and chemicals.
Despite these substantial trade ties, the relationship has been marred by persistent bottlenecks that the upcoming JTC meetings aim to resolve.
In April this year, a high-level delegation led by officials from the Ministry of External Affairs, along with representatives from the Ministry of Agriculture and 25 Indian agricultural companies, visited Kenya. The delegation explored opportunities for collaboration in the agricultural sector, which is seen as a key area for future trade growth.
Kenya is expected to push for more access to the Indian market for its agricultural produce to further increase the balance of trade.
