India - Kenya Trade Relations India - Kenya Trade Relations

India - Kenya Trade Relations

India is one of the largest trading partners of Kenya and India-Kenya trade relations encompasses various sectors of economy. The current trade volume is to the tune of USD 2.2158 billion (2019-20), out of which Indian exports to Kenya was USD 2.126 billion and import from Kenya was USD 89.62 million. Main Indian exports to Kenya include petroleum products, pharmaceuticals, steel products, machinery, yarn, vehicles and power transmission equipment. Main Kenyan exports to India include soda ash, vegetables, tea, leather and metal scrap.

An India-Kenya Trade Agreement was signed in 1981, under which both countries accorded Most Favoured Nation status to each other. The India-Kenya Joint Trade Committee (JTC) was set up at Ministerial level in 1983 as a follow-up to the Agreement. The JTC has met nine times since, the last in August 2019 in New Delhi, in which then Cabinet Secretary (Minister) of the the Ministry of Trade, Industry and Cooperatives Mr. Peter Munya co-chaired the meeting with the Commerce and Industry Minister (CIM) of India Mr. Piyush Goyal. CIM Mr. Goyal, along with External Affairs Minister Dr. S. Jaishankar held a video conference meeting in April 2020 to explore opportunities to promote Indian exports.

Mission organized a meeting of India Business Forum in February 2020 which saw participation from all representatives of Indian companies in Kenya. Mission is organizing a series of webinar, each focussed on specific sectors. The first such webinar was conducted in July 2020, which focussed on Defence, Minerals, Construction and Rail & Metro sectors and saw participation from a large number of stakeholders and companies, both from India and Kenya, including the representatives from Ministries of Petroleum and Mining, Transport, Infrastructure, Housing, Urban Development and Public Works as well as Kenyan chambers of Commerce and KENINVEST, a statutory organization of Government of Kenya to promote investments in Kenya. Indian Defence PSU, BEML presented and showcased its products lines in all the sectors covered.

In 2019, Mission organized India-Kenya Trade and Investment forum, which saw participation of 2 Governors, Principal Secretary of Ministry of Trade and more than 150 representatives of Kenyan and Indian companies. Mission supported several exhibitions/buyer-seller meets and trade events such as ‘Namaskar Africa’ and others. Mission facilitated trade delegations from Tamil Nadu, Gujarat and from many export councils. Due to the initiatives of the mission, an MoU was signed between Narok County Government and SSPL, popularly known as Sri Sri Tattva, to promote Ayurveda and Ayurvedic practices. A digital video conference was organized for interaction between the then CIM Hon’ble Suresh Prabhu and members of business community amongst Indian diaspora in May, 2019.

According to the Kenya Investment Authority (KenInvest), India is the second largest investor in Kenya. Over 60 major Indian companies have invested in various sectors including manufacturing, real estate, pharmaceuticals, telecom, IT & ITES, banking and agro-based industries. Indian investments have resulted in creation of thousands of direct jobs to Kenyans. Indian pharmaceutical companies have a substantial presence in Kenya. A bilateral Double Taxation Avoidance Agreement (DTAA) was signed in 1989. Revised DTAA was signed in July 2016 and came into force on 30 August 2017.

A Joint Business Council (JBC) was set up in 1985 by the Federation of Indian Chambers of Commerce & Industry (FICCI) and the Kenya National Chamber of Commerce & Industry (KNCCI). FICCI and KNCCI signed a fresh MoU in January 2017 on the sidelines of the Business Forum during the State visit of President Uhuru Kenyatta. Revived JBC met in New Delhi in January 2017 and in August 2018. In February 2016, Mission revived a forum of CEOs of over 40 Indian companies based in Kenya and eight meetings of the India Business Forum have been held since then.

Development Cooperation: India offers development assistance to Kenya in the form of loans and credit. This includes a loan of Rs. 50 million to Government of Kenya in 1982 and Lines of Credit by EXIM Bank to Industrial Development Bank Capital Ltd. An Agreement on extension of a Line of Credit of US$ 61.6 million by EXIM Bank of India to Kenya for utilization in the power transmission sector was signed during the visit of PM Raila Odinga to India in November 2010. A loan agreement to extend lines of credit of US$ 15 million (as first tranche out of US$ 30 million) to IDB Capital Limited for development of SMEs was signed in July 2016. A Line of Credit agreement of US$ 29.95 million for upgradation of Rift Valley Textiles Factory (RIVATEX East Africa Limited) was signed in July 2016. The upgraded facility was inaugurated by President Uhuru Kenyatta on 21 June, 2019. An LOC agreement of US$ 100 million for Agricultural Mechanization Project was signed in January 2017.