The Cabinet Secretary at the same time called upon the Indian government to review requirements under the Lines of Credit agreements in order to increase level of local content in investment projects in the country.
“The huge trade imbalance between Kenya and India is unacceptably high and I urge the Indian government as well as Indian investors to support efforts towards narrowing the gap,” said Amina Mohamed.
The Cabinet Secretary was addressing members of the Confederation of Indian Industry, other business leaders and government officials in New Delhi, India.
Underlining the need for innovative ways of addressing the trade deficit, the Cabinet Secretary stressed the importance of projects that add value to Kenyan products which are current being exported to India and other export markets as raw materials.
“To help bridge the trade imbalance, investment projects, preferably joint projects with Kenyan investors, should focus on value addition in order to reduce the countries import bill,” said Amina Mohamed.
Regarding Lines of Credit (LCOs), the Cabinet Secretary called upon the Indian government to review the requirement that not less than 75 percent of project material being funded through LOCs must be sourced from India.
“We appreciate the Lines of Credit which has become a key tool of India’s development diplomacy. However, it is our desire that the LOCs are renegotiated to allow for a 50 percent parity to allow local sourcing of projects and services within Kenya,” said Amina Mohamed.
The Cabinet Secretary assured Indian investors that Kenya was conducive to business saying the country has been ranked among the top tenmost attractive investment destinations in the world.
“Kenya has been ranked the 7th most attractive investment destination not just in Africa but in the world,” said the CS.