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India’s Geopolitical Relation with African Countries

  • Category: World
  • Subcategory: Asia
  • Topic: India
  • Pages: 4
  • Words: 2305
  • Published: 04 September 2018
  • Downloads: 36
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Issues Motivated for Choosing the Study

Geopolitical Support of African countries is important for India’s aim of gaining a permanent seat in UNSC Africa provides a space for displaying both India’s soft and hard power India has been actively involved in peace and stability of African countries through UN Peacekeeping operations. India is involved in capacity building of African countries. Africa is also the largest beneficiary of India’s ITEC programme Economic Africa can help us in diversifying our energy sources, which is one of the stated objective of our Integrated Energy Policy Africa also contains rich reservoir of valuable minerals, metals including gold and diamond Africa provides a space for Indian investment Africa has ample agricultural land which cab address India’s food security. India is looking at leasing land in Africa to overcome the land deficit that we face in terms of arable land.

Geostrategic

Africa is critical to India’s security, especially the Horn of Africa region, because of its proximity with India. The threat of radicalism, piracy, organized crime emerge from this region Existing Scholarly Work Eve. Zvichanzi Nyemba, Mervis Zungura and Lawrence Mhandara (2013) India – Africa trade relations date back to the pre-colonial period during the mid first century when ancient India began to trade with the Kingdom of Aksum. Relations with Africa were solidified during the cold war period with India being instrumental, to the formation of the Non-Aligned Movement (NAM). In the post-cold war period, India – Africa relations have been governed by a mutual interest in trade and investment echoed in the rhetoric of South – South cooperation. India has amid intense competition from the BRICS, particularly, China, and the West, registered its presence in mineral and oil rich Africa. In 2002-2003, India launched The Focus Africa Programme to enhance its trade with Africa with more than 25 African countries, including Zimbabwe. Trade relations between India and Zimbabwe commenced in the 14th Century during the Munhumutapa Kingdom when Indian merchants established links with the country, trading in textiles and minerals. In the 21st century, Zimbabwe and India have continued to trade in minerals, textiles and pharmaceuticals. This paper, therefore, seeks to analyse the nature and extent of India – Zimbabwe trade relations Anushree Paul (IRC-2013)

Indian companies are entering into African domain largely guided by the market and resource seeking motives which promotes potential forward and backward linkage. Indian FDI to Africa is concentrated in oil, gas and mining in the primary commodities market. In the manufacturing sector, a dominance of automobile and pharmaceutical firms is seen. Most of the Indian FDI in African countries is through Greenfield investments and joint ventures that are desired by the host countries due to their contribution in creating new production capacity and generating employment, transfer of technology, etc. The identified factors that motivate Indian investors to invest in Africa are socio-cultural, host country policies, regional integration agreements, bilateral investment treaties, gross domestic product growth etc. Also language, culture, presence of Diaspora does play a significant role in attracting FDI in Africa countries. The relationship between India and Africa exists and functions at these multilateral levels that includes commerce converge.

India is becoming an increasingly important economic partner for African countries. Its ties with Africa can be traced to a strong, shared history based on the principles of South–South cooperation, people-to-people linkages and common development challenges. The third India-Africa Forum Summit, which is taking place in October 2015, will allow India–Africa ties to be strengthened further.

This chapter examines the trade relations between India and African countries as a resource for accelerating developmental cooperation under globalization. It will try to examine the strength and uniqueness of the historical foundation for the current Indo–African partnership in the twenty-first century. India and Africa shared a multidimensional relationship since ancient times. The geographical proximity and an easily navigable Indian Ocean brought the people of the two regions nearer to each other. During colonial times, soon after the conquest of Africa and for restructuring African economy, the free and voluntary relations of the past gave way to colonial needs and preferences. The relations between India and sovereign states of Africa were formally established when both sides gained independence.

Current Situation (2010- Present)

India has carried out a number of initiatives in the past decade to facilitate economic relations between the two regions. The Government of India launched the “Focus Africa” programme in 2002 with the objective of strengthening trade ties with the African countries. The programme extends almost to the entire African continent and the primary objective is to increase interaction by identifying potential areas for bilateral trade and investment. A major initiative by India in recent years has been the India-Africa Forum Summits, held since 2008. The third India-Africa Forum Summit was held in New Delhi in October, 2015. The Summit brought 41 African heads of state and government to India with a view to strengthening the friendship and engagement between the two regions.

In 2009, India launched the Pan African e-Network Project (PAENP), conceived by former President of India, A.P.J Abdul Kalam. The project, with a budget of approximately US$ 125 million, is entirely funded by India and aims to provide satellite connectivity, tele-education and telemedicine services to the African countries. It also supports e-commerce, e-governance, infotainment, resource mapping and various other services. The project has presently been commissioned in 47 countries. Besides, India has also created Lines of Credit to develop projects in the region. India-Africa Trade in the Last Ten Years Total trade between India and Africa increased almost five-fold between 2005-06 and 2015-16, and stood at US$ 52 billion in March 2016-17. India’s exports to Africa increased from US$ 14 billion in 2007-08 to US$ 23 billion in 2016-17 (Figure 1), registering an impressive compound annual growth rate of 5.6 per cent. Indian exports to Africa were at a peak in 2014-15 at US$ 32 billion. Indian imports from Africa, on the other hand, increased from US$ 20 billion in 2007-08 to US$ 28 billion in 2016-17 accounting for 7.5 percent of total Indian imports. Indian imports from Africa grew at a compound annual growth rate of around 4 per cent, reaching a high in 2011-12 at US$ 44 billion.

The estimated value of imports from Nigeria to India stood at US$ 7.7 billion in March 2017, making it the top import source for India. Nigeria accounts for about 26 per cent of India’s total imports. The other major importing countries from Africa include South Africa, Angola, Ghana and Botswana. These African countries together account for about 40 per cent of India’s total imports from Africa. Major Export Items India’s key export in April-February 2016-2017 to Africa was petroleum products, which was around 17 per cent of the total. (Other major export items included pharmaceutical products, vehicles other than railway or tramway, machinery and equipment, and cereals. Major Import Items Among the key imports from Africa to India, petroleum products dominated India’s import basket in April-February 2016-17, with a significant share of 52 per cent of India’s total imports from Africa Other major import items include gems and jewellery, edible fruit and nuts, inorganic chemicals and organic/inorganic compounds, and copper and articles. India’s Investment Relations with Africa Apart from trade, India has also undertaken significant investment initiatives in recent years to strengthen its strategic partnership with Africa. India has become one of the largest investors in Africa. The major investors include Indian Multinational Enterprises (MNEs), Indian construction and telecommunications companies, and several auto industry majors. These investors have been participating in diverse sectors including telecommunications, energy, computer services, power, automobile, infrastructure, etc. in Africa. Approved cumulative investments from India to Africa amounted to US$ 54 billion during April 1996 to March 2016.

Among the African nations, Mauritius is the leading country in terms of receiving highest FDI inflows, followed by Mozambique, Sudan, Egypt and South Africa. In addition to several investments in various sectors mentioned above, Exim Bank of India has in place Lines of Credit (LOC) extended to a number of institutions/agencies in Africa. The total number of operative LOCs to Africa stood at 154 as on December 31st, 2016 amounting to US$ 7.7 billion as extended to 44 countries. CII Initiatives CII has been undertaking multidimensional initiatives for a number of years in order to strengthen India-Africa ties. The CII Africa Committee leads initiatives for enhancing skill development and capacity building in the African nations. These include providing scholarships and internships to African students in India, conducting training programmes for industrial services as well as technology and innovation, and continuous interactive sessions to share information on research and finance options available for traders and investors. For promoting trade and investment, CII works closely with the Government of India and organizes business seminars and international business delegations to Africa for sharing information as well as spreading awareness about the benefits of partnering with India.

Another important aspect of CII’s engagement with Africa is the CII-EXIM Bank Conclave on India Africa Project Partnership, which CII has been organizing since 2005 with the objective of strengthening the India-Africa partnership. CII also organizes regional conclaves and so far, 13 regional conclaves have been hosted in Africa. Furthermore, the African nations actively participate in the international investors meet, “The Partnership Summit”, organized by CII annually, in association with the Ministry of Commerce and Industry, Government of India. The CII Africa Desk also participates in several multilateral business forums such as BRICS, Africa Global Business Forum, World Economic Development etc. to jointly discuss issues and constraints such as tariff barriers, expediting visa applications, technology transfer etc. A key forum organized by CII is the India-South Africa CEOs Forum which was launched by Mr. Jacob Zuma, President of South Africa, during his visit to India in June 2010. The CII Africa Committee develops strategies to improve bilateral economic, industrial and trade relations and also engages in providing solutions and recommendations for strengthening bilateral engagements.

Recommendation for future and Lessons Learned Need to Develop Strategic Ties: The conference reiterated that India and Africa share an old civilisational link, a shared legacy of anti-colonial struggle and an emotional bonding. It was Prime Minister Jawaharlal Nehru who laid down India’s Africa policy for the first time in a positive manner. Anti-imperialism was given special emphasis in his policy. In the post Nehruvian period, particularly in the 1960s and early 1970s, India had a great impact on African countries. During the Cold War, India’s relation with Africa was ‘selective’, due to ongoing bloc politics. Even after the end of the Cold War, Africa was basically treated as a marginalized continent. But over the years, due to factors like democratization, introduction of multiparty election system, and rising GDP have helped many African countries to improve their image at the international level. Role of Major Powers: Africa has now become a central issue in great power politics. The United States (US), the European Union (EU) and China are the major powers in the context of Africa. Africa’s natural resources and the post-9/11 security scenario are two important drivers of great power competition in Africa. In recent times, US engagement with Africa has increased manifold after the American embassies in Africa were bombed in 1998. Although the United States has always used aid as a foreign policy tool in Africa in the post-World War II period, a new set of countries is receiving much higher aid in the wake of 9/11, reflecting American priorities. Africa-EU relations stabilized after the Africa-EU Lisbon Conference. However, trade balance heavily favours the EU; and Africa’s distrust of European countries continues.

Trade and Investment

In case of trade too, West Africa remains important for India. The very fact that India’s trade with West Africa constitutes the major portion of its total trade with the whole of Africa is indicative of that. It is worth noting that India’s trade with West Africa alone constitutes around US $16 billion, while the total amount of its trade with the entire African continent is around US$ 39 billion. In recent times, the Indian government has tried to deepen India’s relations with African countries through the India-Africa Forum. Over the years, it has been increasingly argued that India should focus more on large projects that can have a long term impact on India-Africa relations. In this context, cooperation in infrastructure development needs special mention. It is also suggested that India should emphasize on people-to-people contact, particularly through exchange of delegations. India should also treat Africa as an equal partner in marching towards the twin goals of peace and prosperity. India should expand its business relations with Africa, but at the same time it must be mindful of African sentiments.

Conflict Resolution

Most conflicts in Africa are driven by internal factors, particularly ethnic antagonism. However, ethnicity is not the only factor. Many other factors are equally responsible for the occurrence of civil war within African countries. Ethnicity is just one of those factors which get channelled into the eruption of civil strife. Failure of state institutions in allocating national resources adequately has emerged as a serious problem. Nation building is another problem. The colonial legacy has created antagonism among African countries, which often lead to conflict and violence. In conflict resolution of Africa India could extend its help in training African military personnel, police as well as peacekeepers in resolving conflict. As democratization is the most effective tool in resolving disputes, India can be instrumental for the African states in transferring power in a peaceful manner. India’s assistance in conducting election in African states can also be of tremendous help. Active involvement on India’s part in the development process of Africa will boost India-Africa relations to a large extent.

Works Cited:

1. Ajay Kumar Dubey (2014). “India–Africa Relations: Historical Goodwill and a Vision for the Future”

2. Amanda Lucey, Mark Schoeman and Catherine Grant Makokera (2015). “India-Africa Relations : The Role of the private sector”/p>

3. Sharkdam Wapmuk (2013). “Bilateral Trade and Investment Relations between Nigeria and India”

 

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