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Bulgaria, an erstwhile communist nation, is a free market economy characterised by industrialisation and macroeconomic stability. This European country became a member of the European Union (EU) in 2007. Subsequently, the Bulgarian government introduced several economic reform programmes targeted at achieving a robust gross domestic product (GDP) growth. Today, Bulgaria is attracting an increasing number of Indian SMEs owing to its business-friendly environment and strategic proximity.

Indo-Bulgarian trade relations

India is one of the most important trade partners of Bulgaria in Asia. After the collapse of its communist regime, Bulgaria has shown a keen interest to strengthen its trade and investment ties with India. Currently, India exports tea, coffee, sugar, textile, plastics, paper and tobacco to Bulgaria. While, Bulgaria's export basket for India comprises commodities like inorganic chemicals, copper, aluminium, pulses and metal scraps. The bilateral trade between India and Bulgaria has grown manifold in recent years. Notably, in 2007-08 Indo-Bulgarian bilateral trade was pegged at around $190.99 million.

Besides, the Bulgarian industry is in a transitory phase, undergoing a major shift in ownership from the government sector to the private sector. This transition has further expanded the scope of India to participate in the burgeoning economy of Bulgaria. Indian SMEs are too keen to cash in on the demand for products such as electronics, medical equipment, engineering goods, automobiles and auto parts in Bulgaria.

Opportunities in Bulgaria

Being an associate member of the EU, Bulgarian Products are exempted from import duty in the member countries. Indian SMEs can therefore take advantage of Bulgaria's EU status by setting up industrial units in Bulgaria and marketing their products in other member countries.

In addition, there are various areas of mutual cooperation and growth that can be explored by Indian SMEs for long-term growth. These include industries like leather, petrochemicals, energy, food processing, travel and tourism and chemicals.

Indian SMEs can also tap the opportunities in Bulgaria's evolving knowledge-driven industries such as information and technology (IT), information and communications technology (ICT) and biotechnology.

Trade forums

The governments of both countries agree that to facilitate Indo-Bulgarian bilateral trade it is imperative to enhance cooperation between the SMEs in the two countries. In order to encourage increased economic exchanges between the SMEs in the two countries, the Indo-Bulgarian Joint Commission on Economic, Scientific and Technical Cooperation (JCM) was established in 1973.

Additionally, the Indo-Bulgarian Joint Council was formed in 1976 to help Indian SMEs establish trade linkages in Bulgaria. To cater to the burgeoning IT sector in Bulgaria, an IT forum was formed in 2004 during the 15th JCM.

Given the tremendous growth potential of the Bulgarian market, Indian SMEs can hope for promising business prospects in this south-east European nation in the near future.

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About the Author:

David Parks is a well known author and has written articles on Investment Guide, B2B Portal, B2b Marketplace, suppliers, Manufactures and many other subjects.