Western Australia eyes India for investments

By Sushma Ramachandran

PERTH, APRIL 25. The prospects of Australia becoming a strategic economic partner of India appear to be brightest in Western Australia, the huge state overlooking the Indian Ocean. It is here that giant mining and hydrocarbon companies are located, most of which are eager and willing to business with India. No wonder then that the Deputy Premier, Mr. Hendy Cowan, led a business delegation to India in early February. Moreover, it is the only Australian state to have a permanent trade office in Mumbai.

Mr. Cowan indicated during a meeting with Indian journalists that Australian investments in the mining sector alone could run into billions of dollars over the next few years. Talks are also being held with the Punjab Government on the possibility of reducing post-harvest foodgrain losses. The Australia-led consortium, Australia LNG, has entered into a preliminary agreement with the Orissa Investment Promotion Agency for a five years contract to supply LNG (liquefied natural gas).

Giving an overview of the possible investments in the mining sector, Mr. Cowan said the major areas of interest were gold, mineral sands such as ilmenite and zircon, iron ore, coal and precious stones such as diamonds. According to Australian companies, India had the potential of becoming a major mineral exporter in the long run.

In the case of gold, for instance, Australia currently produced 280 tonnes of gold annually as against only 2,800 ounces by India. Proper exploitation of the resources which had been described as occurring in a ``golden triangle'' in central India could raise gold output to Australia's level, he said.

Mr. Cowan also noted that India had extensive deposits of heavy mineral sands. Tamil Nadu had the largest deposits but Kerala and Orissa also seemed good prospects. Iron ore and coal were the two other minerals where Australian expertise could be used for extraction as well proper utilisation. As for precious stones, he said there was scope for mining of diamonds, rubies and emeralds.

The Western Australian Deputy Premier, who will face elections later this year, assured that the interest in investing in India was not short term. India would be a regular port of call for any newly elected government because of the intensity of interest in the industry. The state's resource-based economy revolved around minerals and agriculture with investment possibilities in these areas as well as in hydrocarbons such as LNG.

The cooperative bulk handling agencies had offered transfer of technology in the area of post-harvest grain handling to the Punjab Government. Studies have shown that grain quality could be vastly improved while huge annual losses of 10 to 15 per cent could be reduced. In financial terms, the annual losses work out to a revenue loss of $ 500 millions every year.

On roadblocks in the way of Australian investments, Mr. Cowan referred to access to geological data and elimination of sovereign risk. One major issue relating to full control of India-based companies had just been resolved with the Government allowing 100 per cent foreign-owned companies in the mining industry.

The fact that Western Australia, with its avowedly ``Look West'' policies is keen to exploit the Indian market is evident from aggressive marketing by State Government agencies. The aim is to achieve an increase in trade and investment flows proportionate to the size of the Indian economy. Currently, the state's trade with Asia comprises 12 per cent of its total trade and India's share is quite low.

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Section  : International
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