Indian businesses will establish a permanent warehouse in South Africa and Air India would resume flights to the country by the middle of this year.
Business houses from India would set up a permanent waerehouse for their goods in Durban with the help of the High Commission, said High Commissioner Satyabrata Pal.
He was speaking at the launch of a three-day India trade exhibition by Indian small businesses in Cape Town, the third such since 2004 aimed at co-operation between Indian Small and Medium Enterprises and South African small entrepreneurs.
Pal's remarks follow reports here that bilateral trade increased by 75 per cent between 2004 and 2005, making India the 13th largest trading partner of South Africa. The warehouse being planned was meant to cater for the growth in trade between the two countries.
Pal said Air India will resume flights to South Africa by mid-2006 and that a private Indian airline would also fly to South Africa.
Air India first started flights to South Africa after post-Apartheid democratic government took over in 1994 but stopped the service some years later. Only South African Airways maintained its flights between the two countries.
Flights between South Africa, India and Brazil were also being planned to increase economic and trade ties among the India-Brazil-South Africa countries, Pal said, adding, "at the moment what you have are container services that are ad hoc, a bit of a chicken and egg situation."
"If there is a lot of trade, then the shipping lines see it in their commercial interest to lay on a liner service, but unless there is an assurance of regular shipping there is a disincentive to go and explore that," the Indian High Commissioner to South Africa said.
"Much of the 75 percent growth in trade is bulk cargo, so shipping companies would see it as in their interest to have these regular services. So I think shipping would also, like the air services, improve qualitatively over the short term, although I can't put a definite frame time on it.
If you have these enablers, everything else becomes so much easier," Pal said.
The increase in trade between India and South Africa has also seen the Engineering Export Promotion Council establishing an office and a show room in Johannesburg.
The Indian National Small Industry Corporation has also set up an office in Johannesburg to co-operate with its local counterparts.
The Indian entry into South Africa has been led by multi-nationals such as Tata Motors and Mahendra Motor Company as also the Indian-origin London-based steel giant Mittal Steel.
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