Sunday, February 19 2006 13:02 Hrs (IST) - World Time -

New Delhi: The official visit of French President Jacques Chirac to India will give boost to two-way trade between the two countries which is expected to exceed 10 billion Euros by 2010 compared to 3.6 Euros in 2005, according to Assocham.

"Indo-French bilateral trade went up by around 80 per cent between 1995 and 2004 and touched the figure of Euro 3.64 billion in March 2005," the chamber said, adding that the same 'will exceed 10 billion Euros by 2010'.

The global French trade in 2005 was 800 billion Euros, out of which the Indo-French trade was only 0.51 per cent, Assocham said in a release.

"Although there is a good impression about France in India, India's trade presence in France is far from being significant," it said.

India doesn't emerge in the list of top 10 investing countries in France, the chamber said, adding that a huge potential market still remains untapped which would be explored with the official visit of French President to India.

In the paper brought out on 'India-France Economic Partnership', the Chamber has highlighted that the major areas for joint cooperation between the two countries will be aeronautical and space, construction products, IT, thermonuclear energy, tourism, agriculture, electrical equipment and organic chemical products.

"India and IT are synonymous as France and wine is. The Indian IT, software and services sector is on track to achieve its target aspiration of USD 77 billion (excluding e-commerce transactions of US$ 10 billion)," Assocham President Anil K Agarwal said while releasing the paper.

According to chamber estimates, Indian exports of software services to France are still at a low level and a huge potential remains open for the Indian software industry.

"This is despite Tata Consultancy Services (TCS) having a partnership with a French company in France", it said adding WIPRO is opening its own representative office in Paris.

"Satyam Infoway is also looking for business opportunities and new Indian companies like Netkraft Private, Technova Information Systems are gaining a preliminary foothold in the French market," Assocham said.

According to the findings of the Paper, Indian pharmacy, IT and automobile firms have evinced interest in investing in France as the domestic companies in these sectors are keen on acquiring existing business or setting up JVs in France.

"The emerging trend in India is that corporates are trying to be closer to their overseas markets through strategic acquisitions. They want to leverage on the low-cost manufacturing capabilities through outsourcing," it said.

Stating that many French companies have gained a foothold in the Indian IT market, it said that in the telecom sector, France has a strong representation through investments made by Alcatel in Gurgaon, Bangalore and Chennai, and France Telecom in Mumbai through a partnership with BPL Mobile.

In multimedia industry, Thomson Multimedia has opened a subsidiary in Chennai and has a significant market share in tubes for the Color TV industry in India, the paper said.

In the road sector, France appears to have a pioneering experience in India with the widening of the road network to four-lane (60 km pathway between Delhi and Jaipur) executed by the big French company GTME in 1997.

The French companies expertise in railways has also been recognised in India through its high participation in the 'Delhi Metro project e-Transaction group', the release said.

The French presence in consumer goods covers a diverse range of activities such as perfumes and cosmetics, tableware and home decoration products as well as fashion accessories.

Brands such as Verrerie Cristallerie d'Arques, Baccarat, Lalique and Daum, which are ranked amongst the top crystal ware companies in the world, today adorn Indian homes, it said.

A large number of world-famous perfume and cosmetic brands such as L Oreal, Clarins, Vichy, Christian Dior, Nina Ricci are also available in the Indian market.

The chamber feels that sectors like automotive industry, aviation, construction & engineering, food processing, retail sector and textile industry have huge untapped potential.

"French investments in these sectors can generate billions of dollars over next 5 to 10 years," the paper concluded.