The dark continent has a numerical silver lining as far as India is concerned: the country's trade with Africa has increased from $893 million (Rs 2,300 crore at then prevailing exchange rates) in 1991-92 to $4.75 billion (Rs 21,389 crore) in the first 11 months of 2003-04, a CAGR of 14 per cent in dollar terms and an impressive 20.42 per cent in rupees. In the same period, Indian exports to Africa have grown from $435 million (Rs 1,121 crore) to $2.2 billion (Rs 9,900 crore).

Given the oil-rich status of the continent, it is natural for companies such as India's state-owned exploration and production behemoth Oil and Natural Gas Corporation (ONGC) to have a presence there. What is surprising, however, is the diversity of other Indian companies that do (a sampling can be seen in the map on this page). Software services giant Infosys and banking software company i-flex have interests in Africa. As do pharmaceutical companies Ranbaxy Laboratories, Dr. Reddy's Labs, and Cipla, truck makers Ashok Leyland and Tata Motors, telco Bharat Sanchar Nigam Limited, telecom equipment manufacturer Midas Technologies, engineering company L&T and a clutch of other worthies. "Africa, driven by Egypt and South Africa," is going to be an important market for us," says R. Seshasayee, Managing Director, Ashok Leyland.

One reason for this is historical. Parts of Africa are populated by people of Indian origin, a legacy of the days when the British shipped Indian labourers, particularly from the southern part of the country, to work in plantations in the continent. Then, there are the descendants of traders from, typically, western India. Ergo, Indians and by extension, Indian companies are acceptable to Africans.

Another reason, and one of fairly recent vintage is strategic. The Government of India is keen to sell Africa as the next big export destination for Indian companies. That isn't out of choice. The US is increasingly focussing its energies on building what it terms 'Free Trade Areas of the Americas', a common market from Canada to Patagonia through Central and South America. The European Union is extending its influence to eastern Europe. And members of the Association of South East Asian Nations (ASEAN) are content to do business largely among themselves. With multilateralism coming to a halt after the Cancun fiasco, India had to perforce look at countries that are neither swayed by the US or the EU, nor harbour fears of being swamped by a 'big brother' the way India's immediate neighbours, the constituents of the South Asian Association of Regional Cooperation (SAARC) do. And the country isn't above paying to trade with Africa. India's Exim Bank, for instance, plans to open a $1.5 billion (Rs 6,900 crore) line of credit for African countries wishing to import HIV medication. Expectedly, Indian pharma companies are the big gainers. Exports to Africa have almost doubled from Rs 894.5 crore in 1999-2000 to Rs 1,571.1 crore in 2002-03. Ranbaxy has two subsidiaries on the continent and Dr. Reddy's is floating one.

The third reason for the renewal of interest in Africa is India Inc.'s new found competitiveness. And the African markets, as one exporter puts it, "are low hanging fruits." That could explain the lure of Africa for India Inc., for the continent may never acquire the status of the US (trade with India in 2002-03: $15.3 billion) or the EU ($24.1 billion). The Dark Continent has its own traps for Indians and Indian companies, but that's another story.

HEART OF DARKNESS
Surviving Africa

Africa has changed since Joseph Conrad wrote his epic about human greed. However, parts of the continent remain dark and dangerous, particularly for businessmen. The recent murder of exporter and promoter of Lord Krishna Bank, Ashwani Puri in Luanda, Angola, is a case in point.

Will this murder deter Indian businessmen from going to Africa? Unlikely, says Y.K. Modi, President of the Federation of Indian Chambers of Commerce and Industry (FICCI), who believes that while Puri's tragic death highlights the risk of doing business in Africa, it should not detract from the opportunity. "It is very sad to lose a colleague, (Puri was a member of FICCI's National Executive), but there are huge opportunities in Africa," he says. "Throughout the continent, Indian products are recognised as being value-for-money, from medicines to trucks to low-value items." Navtej Sarna, the spokesperson for India's Ministry of External Affairs (mea), says the advice mea doles out to businessmen is "get in touch with the Indian embassy or consulate no matter where you go". Sarna would like to see businessmen research the countries they are visiting "because some African states have just emerged from civil strife". Modi proffers three simple rules: study the antecedents of business partners, understand the economic and political situation in the country, and travel in groups. And, if we may add a fourth, stay away from juju men.

-Roshni Jayakar

The Cabinet Of Dr Joshi
Just what does India's Minister for Human Resource Development believe in?

Dr Murli Manohar Joshi, once part of the triumvirate that made up the leadership of the Bharatiya Janata Party, is no longer spoken of in the same breath (or sentence) as the other two, Prime Minister Atal Bihari Vajpayee and Deputy Prime Minister L.K. Advani. Attribute that to his more-nationalistic-than-nationalistic stance in a party that is going to polls on a platform that owes its existence to free market economics. For those interested in understanding the mind of the man, here is a random collection of not-so-well-known facts from the public domain that this correspondent thinks is highly revealing.

The website of the Department of Education, which falls under Joshi's ministry, opens with the image of a gurukul, a Brahmin imparting knowledge to his students in the traditional Indian way.

The minister has aggressively sold the cause of Sanskrit. Delhi's Jawaharlal Nehru University, for instance, boasts an autonomous Centre of Sanskrit Study that could have easily been part of the University's School for Indian Languages. This centre has more faculty than the centre for Hindi (sorry, we do not have details of the student faculty ratio, but can give you those for the IIMs; will that do?). And the expenditure on Sanskrit education in his department's budget has increased steadily to Rs 12.47 crore in 2003-04. Much of it has been used.

Joshi has introduced a programme on Purohitya, the art of becoming a priest, in some universities.

More liberals than you know existed have accused the minister of trying to rewrite history from his point of view in text books. This correspondent doesn't have a view on that, but the budget for promoting new text books has increased from Rs 10.91 crore in 1999-2000 to Rs 21.40 crore in 2003-04.

Numbers indicate that Joshi isn't particularly bothered about reaching out to talented children in rural areas. His ministry spent just Rs 1.95 crore out of an allocation of Rs 9.55 crore in 2002-03, under the head ` national scholarship scheme and scholarships for talented children from rural areas'. This year, the ministry has used Rs 2.23 crore out of an allocation of Rs 10.18 crore.

-Supriya Shrinate

FRAUD
Growth Pangs

Reliance Infocomm has 6.3 million subscribers, all of them for its post-paid service. That's higher than the number of 'post-paid' customers of all other mobile telcos put together. Reason: price-led promotions, such as the Monsoon Hungama scheme, which attracted a million customers in 10 days. Expectedly, several customers gave fake addresses and walked away with the phones. ''We had a higher default rate the subsequent month,'' admits a Reliance spokesperson, ''but this is now below the industry average of 2 per cent." An executive at a rival telco insists the actual figure could be ''even 30 per cent''. The only consolation: "We would have had the same default rate had we rolled out as fast as Reliance," he adds.

-Dipayan Baishya

Tech Services Boom Again
With telcos outsourcing R&D, tech services blooms.

Wipro's Azim H. Premji: IT's back!

In the boom years of 1999 and 2000, companies like Wipro and HCL Technologies that had a presence in R&D services (where you build the innards of products like servers and telecom switches) were considered it services brahmins. That inspired the entry of a handful of start-ups in the space such as Sasken and Mindtree, but the boom was quickly followed by a bust. Guess what? Tech's R&D services business is booming again, and unlike in the enterprise business, there is no global competition except for the in-house R&D departments of telecom companies.

Nasscom is projecting that R&D outsourcing to India will be a $11-billion business by 2008 (up from an earlier estimate of $8 billion or Rs 36,800 crore). Hughes Software, whose customers are mainly telecom infrastructure companies, will grow 69 per cent as on March 2004. The $23-million (Rs 105.8 crore) Sasken, a large player in the fast growing wireless market, is projecting growth upwards of 40 per cent. Mindtree, which is likely to close this year at $28 million (Rs 128.8 crore), has one-third of its business coming from R&D services and is expecting a 90 per cent growth. Even giant Wipro, which employs 6,500 engineers in R&D services, has seen a 30 per cent growth in the first nine months.

HCL's Shiv Nadar: And how!

Most of the companies that BT spoke to expect growth to be sustained. About 60 per cent of the outsourcing to India comes from the 10 tier-one telecom customers ($10 billion-plus revenue), but "we have now identified 250 more tier-two customers who are not outsourcing yet," says Manoranjan Mahopatra, the COO of Hughes Software. Besides, companies like Wipro are looking at new areas such as maintaining and upgrading telecom switches for customers, and offering customer support for complex products. Others like HCL Tech are looking at leveraging their skills in chip design and embedded software to tap new customers in industries as varied as automobile and petrochemicals. This may just be the revival tech firms need to make their outsourcing case stronger.

-Vidya Viswanathan

Q&A
"India Isn't Ready For A Fab"

Microchip's Steve Sanghi: Saying no to fabs

In 1990, when Steve Sanghi took over as President of Microchip Technology, it was a little-known company with a market cap of $82 million. Today, it is the No. 1 player in the 8-bit micro-controller market with a market cap of $6 billion (that's a bit), and Sanghi is its CEO and Chairman. BT's Venkatesha Babu spoke to Sanghi. Excerpts from the interview:

Will you set up a fab in India?

India is not ready for a fab, and the entire domestic market is not even a third of our sales in China. But it is a growing market we want to tap.

How about chip design?

We have been operating an India design centre for the past three years. Three chips that have been designed entirely by the Indian centre are being sold by us internationally. We are looking at growing the centre from a 28-member operation to a 35-member one.

What else?

We are interested in expanding the Indian market for micro controllers.