Johannesburg, Mar 24 (PTI) The African Continental Free Trade Area (AfCFTA), which aims at establishing a free trade regime across the continent, holds great promise for Indian industry, co-chair of the India-Africa CEOs Forum Vivian Reddy said here.

According to economists, the AfCTFA, aimed at boosting development, food security and economic transformation through free movement of persons, capital, goods and services across Africa, has a potential to create a unified market of over USD 1.2 billion for a GDP of more than USD 25 trillion.

AfCFTA would simultaneously reduce the reliance on donor funding in many countries, they believe.

“South Africa has been seen as a springboard to other countries on the continent by Indian business ever since relations with the country were resumed when President Nelson Mandela came into office,” said Reddy, who was made the co-chair of the think-thank of the forum alongside Adi Godrej of India during the visit by Prime Minister Narendra Modi in 2016.

Reddy said the new move augers well for Indian industry because it will open up further opportunities for this to be expanded by the more than 150 Indian companies which are already operating offices in South Africa.

“We are also going to encourage Indian companies and those from the other BRICS countries, who are not here yet, to set up (work) in South Africa because we have the best infrastructure in Africa, so that they could then trade from South Africa to the rest of Africa,” he told PTI.

But South Africa and Nigeria are two of the major players which did not become party to AfCTFA when the heads of state met in Kigali in Rwanda earlier this week for an African Union Summit where 44 countries signed the agreement.

South African President Cyril Ramaphosa welcomed the move towards a continental free trade area, but said his government needed more time to consult relevant stakeholders before signing it.

“We as South Africa want free trade in Africa because we are an important player in the African continent,” Ramaphosa remarked.

“We are part of this process of opening up Africa for trade. All that is holding us back from signing the actual agreement is our own consultation process.

“We still need to consult at home (with) Cabinet, the partners at the National Economic Development and Labour Council and finally to consult Parliamentarians,” Ramaphosa said at the Summit.

Nigerian President Muhammad Buhari, who did not attend the Summit, also said his government needed to do more consultation.

African heads of government had agreed to establish a continental free trade area in 2012 and started negotiations in 2015.

This is published unedited from the PTI feed.