04/03/2011 (The Jakarta Globe) - With Indonesia’s bilateral trade with India growing at a rapid pace, the country is now looking to build greater economic ties with the giant Asian nation, Trade Minister Mari Pangestu said on Thursday.

The value of bilateral trade has risen from $3.9 billion in 2005 to $13.3 billion in 2010. Indonesia, Pangestu said, had a $6.6 billion trade surplus with India but with a bilateral Free Trade Agreement now under negotiation, this could grow much faster.

“Our target is to reach $25 billion in bilateral trade by 2015,” she said.

The two nations singed a Strategic Partnership in January when President Susilo Bambang Yudhoyono was received as the chief guest by Indian Prime Minister Manmohan Singh.

Indonesia is the largest supplier of palm oil to India, accounting for 70 percent of the country’s needs. Indonesia’s other main export, coal, makes up 30 percent of India’s total coal imports.

Pangestu said, however, that her focus was to increase manufacturing and processed goods to India. “We have to push our manufacturing products and we are looking to export processed palm oil products such as cooking oil.”

India has signed a FTA in Goods with the Association of Southeast Asian Nations but has yet to conclude a bilateral FTA with Indonesia. “With the India-Asean FTA tariffs have come down but we are also pushing for a bilateral FTA,” she noted.

Speaking to Indonesian journalists on the sidelines of the India-Asean Business Conclave after touring the Indonesian Pavilion, Pangestu said that over the last two years, India had shifted its economic strategy to concluding bilateral FTAs.

“They have concluded similar agreements with Korea and Malaysia and are now working with Indonesia,” she said. “This is a big market with high tariffs so an FTA will benefit us.”

The minister added that beyond trade, the two countries were also working to expand overall economic ties. Indonesia is seeking greater investments from India for sectors such as infrastructure, information technology and creative industries. “We also want [Indian companies] to invest in smelting and steel mills.”

Indonesian investments in India from 2000 to 2010 totaled $600 million, the second highest amongst Asean countries after Singapore, which has invested $10 billion.