MCCI organized an Interactive Session with H.E. Mr. Fleming Duarte, Ambassador of Paraguay in India on the theme “Doing Business with Paraguay” at the Chamber today. Mr. Yash Poddar, Hony. Consul of Paraguay in Kolkata was also present and spoke on the occasion.
Mr. Duarte said that Paraguay is a preferred destination due to its political stability, kind people and strategic geographic location. This sparsely populated country of about 400,000 square km is the agriculture platform of the world. About 95 p.c. of its land is good for food production and it may be categorized as an axis of economies in food production. In fact, Paraguay has the potential to triple its agricultural production. In addition, Paraguay has abundant natural resources.
Mr. Mahesh Keyal, Chairman, Foreign Trade Standing Committee; welcoming & presenting a bouquet to H.E. Mr. Fleming Duarte, Ambassador of Paraguay to India; [On his left side] Mr. Yash Poddar, Hony. Consul of Paraguay in Kolkata
Mr. Duarte added that Paraguay possesses a good business climate. The country has enjoyed 5.1 p.c. average annual growth rate in GDP over the last 11 years. Paraguay offers among the highest returns, at 22 p.c., in Foreign Direct Investment among Latin American countries. Price inflation is less than 5 p.c. in Paraguay. The Government of Paraguay is embarking on e-governance.
Paraguay has the world’s third largest fleet of barges. The country is the world’s sixth largest producer of soyabean, wheat and corn. Paraguay is the fourth largest exporter of soya bean and the sixth largest meat exporter in the globe. In addition, Paraguay is one of the world’s largest exporters of hydroelectric power. Paraguay exports organic sugar to Europe and USA. The country was famous for its cotton exports, but cotton is no longer a major export item.
By virtue of trade agreements, Paraguay offers access to key markets with tariff advantages. It has a competitive tax regime and the income tax / corporate tax rate is only 10 p.c. compared with the average tax rate of 25 p.c. to 30 p.c. of its neighbors. Besides a low tax rate, Paraguay offers other advantages in productivity and a cost structure that is 30 p.c. less than its neighbours. 70 p.c. of Paraguay’s population is below 35 years and the country offers a young, competitive and cost effective workforce.
An Indian company has invested in a steel factory of 20,000 MT capacity in Paraguay and it is currently in the testing phase. The existing steel factory in the country has a production of 10,000 MT only, and so the balance demand will be met by the Indian company. Steel can also be exported to Brazil. Paraguay has attracted over 100 medium sized companies from Brazil. The most important export from Paraguay to India is soya bean oil. There has been less penetration of Indian IT firms in Paraguay, as Spanish is the major language.
One pillar of Paraguay’s Strategic Plan 2030 is education and training. The Government is bringing together academicians and businessmen. The country has created scholarship funds at the PhD, Masters and undergraduate levels.
Among other issues, Paraguay has an annual demand of 100,000 homes / units. The country is a notable producer of renewable energy.
Mr. Poddar briefly mentioned that main features of Paraguay include its free market system, stable government and low budget deficit of less than 1.5 p.c.
Earlier Mr. Mahesh Keyal, Chairman, Standing Committee on Foreign Trade, MCCIin his welcome address said that Indian imports of soya and sunflower oil from Paraguay are expected to increase in the coming years, given the growing shortage of edible oil in India. The full potential of India-MERCOSUR or more specifically, India-Paraguay trade & commerce has not been explored till now.
Talking about cultural and people-to-people exchanges, Ambassador Duartesaid he is aware that Kolkata loves football and has been a passionate fan of Latin American football. Apart from complementarities in trade, love for football can create bridges of friendship between Kolkata and Paraguay, he mentioned.