India Investment in Ethiopia May Double to $10 Billion by 2015, Meles Says

Investment by Indian companies in Ethiopia may more than double to $10 billion by 2015, helping the Horn of Africa nation end its dependence of food aid, Ethiopian Prime Minister Meles Zenawi said.

About 400 Indian firms have invested $4.7 billion, while trade between the two nations stands at $660 million and should rise to $1 billion in 2015, Meles told a press conference today with Indian Prime Minister Manmohan Singh.

“I’m convinced these are conservative figures,” Meles said in Addis Ababa, the capital.

Indian companies are investing in textiles, mining, leather, agriculture, agro-processing and infrastructure, according to Meles. Projects include Bangalore-based Karuturi Global Ltd. (KARG)’s development of 100,000 hectares (247,105 acres) of land in the western region of Gambella to grow and process sugar, rice, palm oil and cereals.

The government may lease the company a further 200,000 hectares if it develops the land by December 2012, the Agriculture Ministry said on May 5.

Critics who accuse foreign companies of land grabbing are “ill-informed and ill-intentioned,” Meles said. “We have 3 million hectares of unutilized land. We want to use all 3 million. We do not want to admire the virgin beauty of our land while we starve.”

About 3 million of Ethiopia’s 80 million people are in need of emergency food assistance, the government said on April 12. Another 7.8 million people receive food or cash under an aid program, the World Food Programme said on April 28.

India will also advance $300 million for the rehabilitation of the Ethio-Djibouti railway line, Singh said yesterday.

To contact the reporter on this story: William Davison in Addis Ababa via Johannesburg at pmrichardson@bloomberg.net.

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net.