"India and Ethiopia are no strangers to each other. Many millennia ago, Africa and India were joined as one landmass. Today we are separated by the waters of the Indian Ocean but our connections are deep… I am conscious that when one visits Ethiopia one visits the cradle of humankind... it is a land of great natural beauty which was home to the most ancient kingdom in Africa...The sight of women with heads covered and men wearing turbans is strikingly common in [both] Ethiopian and Indian villages. Hospitality in humble village homes begins with simple offerings and guests are treated as incarnations of gods." These are the words uttered by the Indian Prime Minister Manmohan Singh on 26th May, 2011 at the joint session of two houses of the Parliament of Ethiopia. In the backdrop of the recent bilateral visits by the Indian team to Tanzania and Ethiopia, the Indian ties with Africa are being built afresh to continue the 150 year old shared history of both the nations. The Indian-African tie-up is a multidimensional partnership programme objected to bring about mutual empowerment and development to both the nations. In the 21st century world, if the India-Africa commitment visions are achieved, then both the nations will mutually benefit; Africa by rising to become one among the world's developed nations and India, by extending activities worldwide and dominating over the world's superpowers. In all contexts, the Indian-African relationship is one alliance which can take India and Africa along with their huge abundance of resources, into greater and higher dimensions.
Africa: resource-overviewThe African continent which covers almost six percentage of the earth's total land area is potentially the richest of all continents. The resource-overview of Africa indicates that at the global scene, Africa is indeed the 'Mother continent', with a resource-potential which outshines all the economies of the world. The following is a short description of the resource-potential which Africa possesses:•Africa comprises of 54 countries, soon to be 55, and is the world's second largest continent both in terms of land area and population.•A huge array of natural resources indicates Africa's potential to develop socially as well as economically. •Africa is a land rich for its mineral resources and luxuriant forests. •Minerals like gold, silver, platinum, cobalt, chromium; tantalite, manganese and uranium lie beneath the African sands and potentially form the base for a healthy and rich mineral economy. •Africa is also the world greatest oil hub. The states of Angola, Libya, Mauritania and Sudan are a few among the greatest oil producers of the world. •Despite innumerable number of social, economic and political issues like poverty, illiteracy, apartheid in the past, consequences of colonial rule, diseases and ailments, political wars, underdevelopment and violence, the African nations are modernizing and participating in the global scene thus empowering itself to become one of the fast-developing countries of the world.
Africa: past and presentDespite the various cultures and practices which make Africa the potentially richest country in the world, a spate of formidable problems has limited the development of this continent since the period when colonialism prevailed. Tracing the history, the major issue which Africa faced in the olden times was Apartheid. Apartheid persisted in South Africa till it was abolished finally in 1994. At the time when Apartheid, or the practice of discriminating people on the basis of color and race, persisted in South Africa, the African continent was considered as the evilest of places. With this, highly dreadful and infectious diseases like Malaria and AIDS had fatal effects on the human populations of South Africa. Different researches and surveys conducted showed that Africa was a nation which was greatly influenced by the threats related to poverty. In fact, even as the world rose to development, poverty levels in African states soared high with time. Poor administration and corruption was coupled with the already pathetic state of affair in Africa which further added up to the slow-down of African development. High illiteracy rate and population also increased and the African economy continuously and constantly declined. These were the main reasons why Africa remained underdeveloped in the past, even when it was blessed with a plethora of natural resources.Far away from those dark time-periods, today Africa is developing. Various global nations and economies have inclinations towards this continent owing to the huge resource-potential it possesses and this has helped a great deal in allowing the flow of economic resources in and out of Africa. The African countries depend on other nations for economic and political help and empowerment. In the past decades, Africa has greatly focused on and enhanced infrastructure facilities, thereby creating new possibilities for development. Africa, as already said, is rich in mineral resources and oil reserves. The African nations have researched on and learned ways to use these mineral-resources effectively and wisely. Africa's economic growth has greatly increased as some of the African countries expanded the possibilities of petroleum extraction. In short, presently Africa is the synonym of fast-paced development and it is worth the notice of global powers that the people of Africa, even while facing problems like illiteracy, overpopulation, violence, diseases and underdevelopment, never allowed these afflictions to crumble their march towards a bright and better future.
Root causes for African underdevelopmentAfrica is a land of contrasts, the cradle of humankind and the myriad of myths and cultures. The high resource-potential of Africa can in no way be matched with the poor development-trend that has been prevailing in this country. In spite of a great abundance of natural resources, African economy still remains underdeveloped. Since centuries, the African continent had been under the influence of factors like slave trade, apartheid, colonialism, population-explosion, fallout of diseases, high mortality rate, social violence and so on. Even while being the world's second-largest continent in terms of both land and human-resources, the African lands and its people could never receive its share in globalization and development. How have the trends in the global scene affected Africa? Why is the African population not fortunate enough to properly utilize their resources for their own development? Why is the African continent underdeveloped even in the 21st century? The root causes for African underdevelopment are briefly described below:
1.Apartheid: Apartheid existed in Africa since the periods when it was under the colonial rule of the European powers. Apartheid or the practice of racial segregation was formally imposed on the African countries between 1948 and 1994, though it informally prevailed even from the colonial times. "Black", "white", "Indian" and "colored" were the four categories of races into which the people were grouped. While the "white" exercised a minority rule in the administration and social lives in Africa, the other categories of people were often refused and deprived of their social rights in the African society. This institutionalized racism has left Africa in its underdeveloped states.
2.Prevailence of colonial rule: In the 1880s, European colonial powers had set out to conquer the world's underdeveloped economies to loot their resources and exploit the people of these economies. Africa, being rich in resources, attracted the European colonialists' attention and soon, Africa too came under the list of continents which were under European control. The period of colonialism was the evilest in Africa's history and it was during this period, that the Africans were deprived of their moral and social rights and that the global superpowers of that time looted the African nations of their wealth and pride. By the time colonial rule had ended, Africa had very little resources, people were affected by contagious diseases like malaria and the scope for development had completely declined.
3.Slave trade: Slavery and servitude prevailed in Africa since colonial times. Though the practices of slave-trade were condemned by the governments, Europeans and Arabs continued to market slaves and captives to the foreign slave systems. Slave trade had detrimental impacts on the social and economic development of Africa as most of the farmers and workmen of the African nations were shipped overseas as part of slave-trade. Mental health and development of the African economy was curbed by slave-trade.
4.High population and low life-expectancy: Rapidly expanding population of Africa had a direct influence on the economic development and well-being of the country. Owing to the poor infrastructural development and medical facilities, the African population showed a poor life-expectancy, of below 50 years. This population-explosion which took place in Africa in the past decades is one major cause as to why thirty-four out of fifty-four African countries had been included in the list of world's least developed countries.
5.Illiteracy and poor management of resources: African economy is deprived of the basic requisites for development and education is one among such requisites. Illiteracy has resulted in the huge expansion of population which has made it all the more impossible for the country to share its limited economic resources with the people. With this, poor management of resources has also resulted in the underdevelopment of Africa.
6.Poor governance: A proper and effective political system is what it takes for the development of an underdeveloped country. The governments in Africa had been mostly corrupt and ineffective in the past. Corruption is prominent in all spheres of administration and government and this has added to poor development statistics in Africa.
Shared history of India and AfricaIndia's engagement with the 'Mother Continent', Africa, is 150 years old. After the end of apartheid in 1994, the Indian-African relations have taken a diplomatic turn. South Africa presently has a large population of people of the Indian descent. It can be said that Gandhiji, the father of our nation, had a great role to play in bringing the Indian and African history under one roof. While he spent twenty formative years in Africa, Gandhiji researched upon ways to end the evil of apartheid from the African society. Sathyagraha, which Gandhiji formulated as en effective tool against colonialism came alive in the African society and was later used against the European super powers by Nelson Mandela. African history has milestones of Indian legends like Gandhiji's and Jawaharlal Nehru's reform measures with regard to racial discrimination and equality. The recent bilateral visits by the Indian representatives to the African countries are aimed at continuing the legacy of those great leaders in lending a helping hand for Africa's development.Today, 150 years after the blooming of relations between India and Africa, India is strengthening afresh the ties with Africa with the aim of mutually empowering and developing the economies of both the nations. Apart from the cricket-relations that visibly prevail between the Indian cricket team and South African cricket-team, both these nations have entered into a new phase of economic and political commitment in the past few decades. Over three years, India has pledged a $5 billion credit line for developmental activities of Africa.
India-Africa bilateral relations in the pastIn the 21st century context, India-Africa bilateral relations are booming high. But before coming to the present day commitments taken by both the nations on mutual development, we need to identify the happenings in the past which strengthened the India-Africa relations and effectively led way for the 2011 India-Africa forum summit, which Africanists in India claim to be a high water-mark in the history of both the nations. The India-Africa commitment activities can be traced through the following time-line:•In late 2006, the Indian Prime Minister Manmohan Singh traveled to South Africa to strengthen the India-Africa relationship as part of the inauguration of the centenary celebrations of Sathyagraha in Africa.•In 2007, the Prime Ministers continued to represent the nation in the African partnership programme by visiting Nigeria. •In 2007 itself, South Africa hosted the IBSA summit which involved the nations of India, Brazil and South Africa and the Indian prime minister had attended the summit thus deepening the bilateral relations between India and Africa.•In November, 2007, the Prime Minister visited Kampala, in the African continent, to represent the country at the Commonwealth summit.•The historic event in India-Africa shared history, the first ever India-Africa forum Summit was hosted in New Delhi in April, 2008. The IAFS-I instilled new momentum in the already existing relationship between India and Africa while simultaneously encouraging the India-Africa interaction.•Since the first India-Africa forum Summit, India hosted several African dignitaries and policy-makers from Africa.•The state capital, Delhi, hosted the Ministerial conference of Least Developed Countries (LDCs) in February, 2011.•Before the 2011 Addis Ababa summit held in May, 2011, a group of six ministers of India were despatched to Africa as the Prime Minister's special envoys. •In May, 2011, the second India-Africa forum Summit was held in Addis Ababa and this was followed by the Prime Minister's bilateral visits to the countries of Ethiopia and Tanzania.From these happenings which strengthened the India-Africa commitments, the African nation has indicated that they are keen to deepen cooperation with India so that they can benefit from India's success and join in India's endeavors thereby developing its own economy.
India-Africa forum summitsThe greatest milestones which mark the role of India in African development are the India-Africa forum summits, which were held in the years 2008, 2011 and the thirds summit, which is proposed to be held in 2014.
India-Africa Forum Summit-I at New-Delhi"Dynamic Partnership; Shared vision" was the caption which declared the India-Africa forum summit-I or the IAFS-I which was held on 8th and 9th April, 2008 at New Delhi. The 2008 summit highlighted the various perceptions of both the nations on a wide range of affairs. Both the nations convened a "Framework for enhanced cooperation" and after duration of two years from the summit, the Joint action plan was formed. The IAFS-I was focused on combined efforts from both the nations to plan a multi-layered relationship which would involve development of major sectors like agriculture, trade and industry, peace and security, governance and Information technology. The major achievements of the 2008 India-Africa forum summit were the following:•Both the nations consented to be part of an extensive trade-relations programme which would mutually benefit the countries' trade, industry, foreign direct investment (FDI), and development of small and large scale enterprises and so on.•The agricultural sector of Africa received strengthening from India through ensuring food security, capacity-building, joined partnership against agro-based diseases, enhancing markets etc.•Trade and industry was focused as part of economic development by stressing the need for two-way trade, enhancement of markets, expanding benefits of trade-liberalization etc.•Further cooperation in the fields of peace and security, science, technology, political cooperation, information technology, social development, health, culture and sports, finance, tourism, media and communication were established through the Joint action plan.
India-Africa Forum Summit-II at Addis-AbabaThe 2011 Addis Ababa IAFS-II was aimed at broadening the Indo-African partnership programme. The summit was attended by 14 leaders from Africa and India Prime Minister Manmohan Singh. Targets were objected to be set at $100 billion for investment until 2014, when the third IAFS would be held. India's products and services were to be facilitated with easier entry into those regions of Africa which demanded them more. Information and communication technologies were also objected to be given greater importance in expanding the human-resource development of Africa. The set of seven fields declared at the 2008 summit, where India and Africa would extend partnership programmes were transformed slightly at the Addis Ababa summit. The funding measures which the Indian government offered to Africa at the Addis Ababa summit are:•$5 billion for lines of credit to Africa.•$700 million for new institutions and training programmes•$300 million for Ethiopia-Djibouti railway lines.At the Addis Ababa declaration, India stressed that capacity-building would be the highest-priority in the India-Africa relationship and that infrastructure development and trade and investment would receive secondary preference.
India-China competition in Africa's developmentThough, views regarding the India-China competition in Africa's development exists, the African government has made it clear that they would work with both the nations and use the competition to benefit in development. When compared to China's $126 billion trade with Africa, India stands way behind with the $46 billion trades with Africa. A healthy competition between the two nations will definitely benefit Africa socially as well as economically. Owing to Africa's huge appetite of almost 493 billion a year to cope up with the infrastructural gap, all the economies of the world, including India and China should actively invest economically in Africa, to uplift it from the status of a third world country.
Future prospects of the Indo-African relationshipsThe two India-Africa Forum Summits have held before the Indian government huge tasks to do, by achieving the nineteen institutions mentioned in the 2008 New Delhi Summit as well as by expanding further declarations announced at the 2011 Addis Ababa summit. Before the 2014 India-Africa Forum Summit, both Indian and African economies need to rise up and enhance cooperation as a shared dream. The India-Africa relations can indeed be fruitful if the following points regarding the measures offered are achieved:•In the past decade, the Indian representatives in African partnership have managed to visit only a few of the African nations. Many more of the African lands need to be visited by Indian presidents and prime ministers to deepen the bond.•Invitations and treaties long pending from the African-governments should be respected and considered by our policy makers.•Indian commitment to Africa should not be a mere effort to exploit the African countries' resources but it should be aimed at mutual benefits and more, at African upliftment.•The promises given need to be kept and Indian agreements to Africa should be soon materialized.•Without rivalry with any of the world's nations, India should extend hands to help Africa and act effectively to develop the African continent
Monday, November 28, 2011
India Africa Trade Relations
Historical development of trade relations of Africa with other nations• Due to the compulsions of the Industrial revolution in Europe in the 18th century, several west Europeans countries started their search for raw materials needed by their fast growing industries and markets for the finished goods produced in these industries. Their main destination for this was the countries South East Asia which were rich in natural resources. This gave rise to imperialism in the third quarter of the nineteenth century and many countries of Asia were made as the colonies of several western European nations. However Europeans did not pay much attention to Africa despite its proximity to Europe in the south. The European nations thought Africa to be unproductive and did not explore it. This was the reason that Africa was known as Dark Continent to them. Later when they explored it they called it the White man's burden. They spread this ideology that they were spending on the development of an unproductive land. • David Livingstone and Cameron were the first to explore Africa and found this virgin land fit to be colonized by the land-hungry countries of Europe. King Leopold II of Belgium convened conference European nations in 1879 to discuss exploration of Africa. As a result, Stanley was sent to Africa and he made hundreds of treaties with the native chiefs of Africa. King Leopold II of Belgium assumed the title of sovereign of Congo. Very soon afterwards, the Portuguese made Angola and Mozambique as its colonies. The Italians had Somaliland and Abyssinia. The French acquired Algeria, Tunis, French Congo, Morocco and Ivory Coast. England established their colonies in Egypt, south Africa, North Somaliland, British East Africa or Kenya. Germany took over part of East Africa, Cameron and Togoland.• However, due to political awakening in Asia and Africa and revolution in Russia in the beginning of the 20th century, most of the countries in Asia and Africa increased the tempo of freedom movements in these countries and several countries in these two large continents of the world started gaining independence from the former masters one by one.• China and former European masters of African colonies started developing their trade relations with the newly independent countries of the Africa in the 1960s. The policy of China was not of mutual development of the African countries. The Chinese companies did not engage the local labour leave aside managerial and skilled posts even in construction work. This did not help the African countries in reducing their unemployment problems despite their good trade relations with China.
Africa and India trade relations – historical background• India was well known to Africa through our Father of Nation, Mahatma Gandhi who lived and worked in South Africa for 21 years up to 1915 and fought for the rights of black population of Indian or African origin. African nations thought of India as their natural alliance. It was tied to India through historical bond. Even Jawaharlal Nehru, the first Prime Minister of India, termed it as a sister continent. India having gone through the clutches of slavery herself supported the independence movements of several African countries. • At the time of independence in 1947, India was a poor and underdeveloped countries with hardly any industries in India. Even the Indian agriculture depended on old agricultural practices and crop yields per hectare were very low as compared to many developed countries of the world. As such, India had nothing to offer other than moral support to Africa. It had nothing to export and nothing import from Africa since African countries were also sailing in the same boat. Hence there were no significant trade relations between India and Africa immediately after independence and we could not do much in the developmental efforts in Africa for a quite a long period. The Indo African trade relations could make some semblance only after the Indian economy was liberalised in the eighties and nineties and we had some thing to offer to the African countries especially during the past one decade.
Indo African trade relations during the last 60 years since independence • As stated in the earlier paragraphs, India could not make any headway as far as the trade relations and development of Africa was concerned in the 1950s except that India's first Prime Minister Jawaharlal Nehru significantly represented India at some other important Afro Asian conferences held during this period. Pundit Jawaharlal Nehru was the main participant at the Banding Conference held in December 1954. It was the first conference of the Afro Asian countries where several countries of Asia and Africa could assemble together on one platform. India had made strong diplomatic preparations for this conference seeking support the all participating countries for the peaceful co-existence and to enhance goodwill and cooperation among the Afro Asian – African nations. It discussed social, economic and cultural matters between the countries of Asia and Africa. The very next year Pundit Jawaharlal Nehru visited Egypt on an invitation of President Nasser who was present at the conference.• India could do much in the development of Africa during the past 60 years faced by its own economic and political compulsions at home. On the other hand China did not lose its focus on China since 1960. On the other hand India despite its being looked upon as role model by many African nations could not do much in the sphere of developing trade relations with African countries compared to China. The momentum of goodwill created by Mahatma Gandhi, Jawaharlal Nehru and Indira Gandhi who were greatly respected by the African people could not be utilised much in the absence of any proper trade policy directed towards Africa. Even during the 1990s India lost its momentum when it got preoccupied with its trade relations with west whereas China constantly kept on directing its focus on Africa. In the early 1970s, China built the 1800 kilometre long Tan-Zam railway enabling Zambia to export its copper through East African ports. • Meanwhile China continuing its good trade relations with Africa helped it build its official buildings, conference halls and sports complexes and going much ahead than India in its role of African development. India's contribution towards African development had been minimal even during 1990s except granting scholarships to African students and donating three wheelers and Tata trucks to some African countries. Chinese Presidents and Prime Ministers had been making regular visits to African countries but India was very late in doing so. After Chinese economy started growing fast it started offering liberal credit and aid to the African countries whereas India had nothing to offer comparatively. So much so that Angola recently refused an International Monetary Fund offer for its reconstruction projects and instead opted for a $2 billion soft loan and aid package from China with a few strings attached overshadowing Indian move, if any.
African oil and rivalry between India and China in infrastructural development of Africa• China has entered into many lucrative trade agreements in respect of oil exploration in China. 25 to 30 per cent requirements of oil of China come from the African countries. Africa is the second largest supplier of crude oil in the world. Nigeria is one of the largest producers of oil in Africa. India also gets a part of its imports of oil from Nigeria. Although India may wish to deal with Africa in the same magnitude as China it is not in a position to compete with China at present. The offer of $200 million by the Indian public sector company Oil and Natural Gas commission (ONGC) for the infrastructural development of that country is just a meagre amount compared to $2 billion offered by China for the same purpose. • Both India and China are now investing in African countries like Sudan and Zimbabwe despite protests from the west. India has recently laid down a $200 million pipeline that links Port of Sudan on the Red Sea with Khartoum, the capital of Sudan. India's trade with Africa increased from $97 million in 1991 to $20 billion last year. Although, China's trade with Africa was lower than India's in the early 1990s but it stands at $55 billion annually at present which is much higher than India. China is Africa's third largest trading partner after the U.S and France presently. India claims that its renewed interest in Africa has nothing to do with Chinese expansion in this region. India's policy is not to enter into any rivalry, competition or race with China in expanding its trade relations with Africa or any other country.
India's recent developmental programmes in Africa• During the recent years India had been actively engages in promotion of trade activities and programmes with African nations. The Government of India launched a programme called "Focus India: Africa" under the Exim Policy of 2002-07. The main purpose of the programme was to boost Indian trade with the sub-Saharan African region. Mauritius, Kenya and Ethiopia were the target countries to be included in the first phase of the programme. Under this programme, the Indian government was to provide financial assistance to various trade promotion organisations, export promotion councils and apex chambers. The focus under the programme was to form Market Development Assistance. Under the programme, India's Exim Bank has extended Lines of Credit (LOCs) to support export of eligible goods on deferred payment terms. The offering os such credit is to expand export of those products which are identified and has potential to increase the trade between two regions. • India's potential exports to these countries are machinery and transport equipment, petroleum products, paper and wood products, textiles, iron and steel, plastic and linoleum products, rubber manufactured products, agro products, chemicals and pharmaceutical products. The imports from these countries can include petroleum, metallurgical goods, raw cotton, fruit, vegetables and preparations, chemicals, non-metallic mineral manufactures, precious stones, textile yarn, gold, nickel, and ferro-alloys. There are some other sectors which are important for investment. These are tourism, pharmaceuticals, electronics, computer software and accessories, information technology related products, financial services and textiles. It should also be noted that Andhra Pradesh, a large southern state of India has signed an agreement with Kenya and Uganda to send 500 farmers to cultivate land in the East African countries. This is an encouraging development.• In addition to the above efforts, several Indian businessmen look to Africa for starting their new ventures. A high level delegation headed by Ratan Tata, one of the wealthiest businessmen and industrialists of India visited Africa recently. Already Tata Motors and the another car giant Mahindra & Mahindra have made their entry into the South African motor industry and have launched their new vehicles in that country. Tata Africa Holdings, a subsidiary of Tata Group is trying hard to control stake in South Africa's second telephone network operator worth more tan Rand 4 billion. Presently the total bilateral trade relations between India and South Africa are reaching close to Ran 6.5 billion. India's imports from South Africa stand at Rand 3.12 billion and its exports are around Rand 3.35 billion. India's investment interests in South Africa stand around $100 million.• India is planning to provide duty free access to products form the least developed nations of Africa. To boost further the bilateral trade relations with Africa we have had two African – Indian summits so far. The first was held in April 2008 and the second summit and the second was held in recently at Addis Ababa. The pan African e-network which is being funded by India has helped to improve trade relations of India with 53 nations of the Africa. It would provide tele-education and tele-medicine facilties in African countries.• At the India-Africa summit, Manmohan Singh agreed to an easy access for African exports to the Indian markets. According to Prime Minister Manmohan Singh, "The 21st century could be turned into a "century of Asia and Africa". A frame work was created at the summit with a pledge to boost trade and investment and sharing of expertise in the development of agriculture in Africa. India has pledged to for cooperation in the fields of Science and technology, water management and education. India also has pledged to provide preferential markets to the 34 "least developed" nations of the African continent. The Prime Minister Manmohan Singh agreed to issue grants for projects in excess of $500 million to the African countries during the next five to six years. The Indian priorities will be for developing infrastructure in information technology, telecommunications, power and railways in Africa. The African leaders indicated to the Indian authorities that they should not look at Africa simply as a source of raw materials but should invest in the continent's human capital and share know-how and expertise with its nations. It will be in order to recall Mahatma Gandhi's brief observation that the "Commerce between India and Africa will be of ideas and services, not of manufactured goods against raw materials after the fashion of Western exploiters.
How India can have an edge over China in its role in African development• India in fact can play a more important role in the development of Africa than China. Former World Bank economist William Easterly in his book "The Whiteman's Burden" praised India's model of engaging Africa with a view to promote trade with Africa. The World Bank study of 2006 also observed that Indian firms are better placed in African markets than their Chinese counterparts. Compared to the Chinese firms which bring their own workers in Africa even for construction and other such works while the Africans are facing severe unemployment problems, the Indian firms which employ local manpower and engage even the managerial staff from the local market stand to gain advantage in the eyes of the Africans than China. • Looking at the mineral and energy resources of Africa, several major economic powers are trying to woo Africa to enhance their trade relations in the region. But African governments will want sustainable benefits from them to benefit the African citizens. India stands to benefit from this approach of the African governments by its policy directed at the economic development of Africa for the mutual benefit of both India and Africa.• India's policy towards partnership with Africa has a three pronged approach which is directed at information and communication technology, human resources development and deeper economic linkages between India and the African countries. This policy of India of African development will take both India and Africa to face the challenges of the 21st century.
Conclusion• India is going to play a very vigour role in the development of Africa in future. At the recently concluded India – Africa two day Summit which was attended by 14 African countries it was clearly seen that India is going to develop and aggressive strategy to play a higher role and show its presence in the region vis-à-vis China. India though a late entry to join its rivals in Africa, shows a lot of promised in a number of areas. Both India and Africa have taken a pledge to work together to meet the economic and political challenges facing India and the countries of the African continent. It has been clearly stated by India that Indo-African friendship will be based on equality, mutual friendship, respect and understanding to meet the aspirations of the people of this region. India Africa bilateral trade in goods and services have grown three times during the recent years but still there is a huge potential. India's constant economic growth at an average of 8% for the past four to five years is expected to do better in the coming decade. So there is optimism about India's contribution for the development of Africa and for Africa's growth prospects. • Alpha Qumur Konare, the Chairperson of the African Union has stated that India truly understands the needs and aspirations of the people of African countries. All African leaders are alike in their thinking that India is of great help in the fields such as health, information technology, communications and agriculture. Prime Minister Manmohan Singh has stated that India-Africa Summit has provided a framework of co-operation between India and Africa. Although many countries have already mad a good start in the region especially the former colonial power France and China, but many Africans feel France as a legacy of colonialism thrust upon them. Hence there are better chances for India to develop its trade relations with Africa which would go a long way for the development of mutual growth and prosperity of both Africa and India.
Africa and India trade relations – historical background• India was well known to Africa through our Father of Nation, Mahatma Gandhi who lived and worked in South Africa for 21 years up to 1915 and fought for the rights of black population of Indian or African origin. African nations thought of India as their natural alliance. It was tied to India through historical bond. Even Jawaharlal Nehru, the first Prime Minister of India, termed it as a sister continent. India having gone through the clutches of slavery herself supported the independence movements of several African countries. • At the time of independence in 1947, India was a poor and underdeveloped countries with hardly any industries in India. Even the Indian agriculture depended on old agricultural practices and crop yields per hectare were very low as compared to many developed countries of the world. As such, India had nothing to offer other than moral support to Africa. It had nothing to export and nothing import from Africa since African countries were also sailing in the same boat. Hence there were no significant trade relations between India and Africa immediately after independence and we could not do much in the developmental efforts in Africa for a quite a long period. The Indo African trade relations could make some semblance only after the Indian economy was liberalised in the eighties and nineties and we had some thing to offer to the African countries especially during the past one decade.
Indo African trade relations during the last 60 years since independence • As stated in the earlier paragraphs, India could not make any headway as far as the trade relations and development of Africa was concerned in the 1950s except that India's first Prime Minister Jawaharlal Nehru significantly represented India at some other important Afro Asian conferences held during this period. Pundit Jawaharlal Nehru was the main participant at the Banding Conference held in December 1954. It was the first conference of the Afro Asian countries where several countries of Asia and Africa could assemble together on one platform. India had made strong diplomatic preparations for this conference seeking support the all participating countries for the peaceful co-existence and to enhance goodwill and cooperation among the Afro Asian – African nations. It discussed social, economic and cultural matters between the countries of Asia and Africa. The very next year Pundit Jawaharlal Nehru visited Egypt on an invitation of President Nasser who was present at the conference.• India could do much in the development of Africa during the past 60 years faced by its own economic and political compulsions at home. On the other hand China did not lose its focus on China since 1960. On the other hand India despite its being looked upon as role model by many African nations could not do much in the sphere of developing trade relations with African countries compared to China. The momentum of goodwill created by Mahatma Gandhi, Jawaharlal Nehru and Indira Gandhi who were greatly respected by the African people could not be utilised much in the absence of any proper trade policy directed towards Africa. Even during the 1990s India lost its momentum when it got preoccupied with its trade relations with west whereas China constantly kept on directing its focus on Africa. In the early 1970s, China built the 1800 kilometre long Tan-Zam railway enabling Zambia to export its copper through East African ports. • Meanwhile China continuing its good trade relations with Africa helped it build its official buildings, conference halls and sports complexes and going much ahead than India in its role of African development. India's contribution towards African development had been minimal even during 1990s except granting scholarships to African students and donating three wheelers and Tata trucks to some African countries. Chinese Presidents and Prime Ministers had been making regular visits to African countries but India was very late in doing so. After Chinese economy started growing fast it started offering liberal credit and aid to the African countries whereas India had nothing to offer comparatively. So much so that Angola recently refused an International Monetary Fund offer for its reconstruction projects and instead opted for a $2 billion soft loan and aid package from China with a few strings attached overshadowing Indian move, if any.
African oil and rivalry between India and China in infrastructural development of Africa• China has entered into many lucrative trade agreements in respect of oil exploration in China. 25 to 30 per cent requirements of oil of China come from the African countries. Africa is the second largest supplier of crude oil in the world. Nigeria is one of the largest producers of oil in Africa. India also gets a part of its imports of oil from Nigeria. Although India may wish to deal with Africa in the same magnitude as China it is not in a position to compete with China at present. The offer of $200 million by the Indian public sector company Oil and Natural Gas commission (ONGC) for the infrastructural development of that country is just a meagre amount compared to $2 billion offered by China for the same purpose. • Both India and China are now investing in African countries like Sudan and Zimbabwe despite protests from the west. India has recently laid down a $200 million pipeline that links Port of Sudan on the Red Sea with Khartoum, the capital of Sudan. India's trade with Africa increased from $97 million in 1991 to $20 billion last year. Although, China's trade with Africa was lower than India's in the early 1990s but it stands at $55 billion annually at present which is much higher than India. China is Africa's third largest trading partner after the U.S and France presently. India claims that its renewed interest in Africa has nothing to do with Chinese expansion in this region. India's policy is not to enter into any rivalry, competition or race with China in expanding its trade relations with Africa or any other country.
India's recent developmental programmes in Africa• During the recent years India had been actively engages in promotion of trade activities and programmes with African nations. The Government of India launched a programme called "Focus India: Africa" under the Exim Policy of 2002-07. The main purpose of the programme was to boost Indian trade with the sub-Saharan African region. Mauritius, Kenya and Ethiopia were the target countries to be included in the first phase of the programme. Under this programme, the Indian government was to provide financial assistance to various trade promotion organisations, export promotion councils and apex chambers. The focus under the programme was to form Market Development Assistance. Under the programme, India's Exim Bank has extended Lines of Credit (LOCs) to support export of eligible goods on deferred payment terms. The offering os such credit is to expand export of those products which are identified and has potential to increase the trade between two regions. • India's potential exports to these countries are machinery and transport equipment, petroleum products, paper and wood products, textiles, iron and steel, plastic and linoleum products, rubber manufactured products, agro products, chemicals and pharmaceutical products. The imports from these countries can include petroleum, metallurgical goods, raw cotton, fruit, vegetables and preparations, chemicals, non-metallic mineral manufactures, precious stones, textile yarn, gold, nickel, and ferro-alloys. There are some other sectors which are important for investment. These are tourism, pharmaceuticals, electronics, computer software and accessories, information technology related products, financial services and textiles. It should also be noted that Andhra Pradesh, a large southern state of India has signed an agreement with Kenya and Uganda to send 500 farmers to cultivate land in the East African countries. This is an encouraging development.• In addition to the above efforts, several Indian businessmen look to Africa for starting their new ventures. A high level delegation headed by Ratan Tata, one of the wealthiest businessmen and industrialists of India visited Africa recently. Already Tata Motors and the another car giant Mahindra & Mahindra have made their entry into the South African motor industry and have launched their new vehicles in that country. Tata Africa Holdings, a subsidiary of Tata Group is trying hard to control stake in South Africa's second telephone network operator worth more tan Rand 4 billion. Presently the total bilateral trade relations between India and South Africa are reaching close to Ran 6.5 billion. India's imports from South Africa stand at Rand 3.12 billion and its exports are around Rand 3.35 billion. India's investment interests in South Africa stand around $100 million.• India is planning to provide duty free access to products form the least developed nations of Africa. To boost further the bilateral trade relations with Africa we have had two African – Indian summits so far. The first was held in April 2008 and the second summit and the second was held in recently at Addis Ababa. The pan African e-network which is being funded by India has helped to improve trade relations of India with 53 nations of the Africa. It would provide tele-education and tele-medicine facilties in African countries.• At the India-Africa summit, Manmohan Singh agreed to an easy access for African exports to the Indian markets. According to Prime Minister Manmohan Singh, "The 21st century could be turned into a "century of Asia and Africa". A frame work was created at the summit with a pledge to boost trade and investment and sharing of expertise in the development of agriculture in Africa. India has pledged to for cooperation in the fields of Science and technology, water management and education. India also has pledged to provide preferential markets to the 34 "least developed" nations of the African continent. The Prime Minister Manmohan Singh agreed to issue grants for projects in excess of $500 million to the African countries during the next five to six years. The Indian priorities will be for developing infrastructure in information technology, telecommunications, power and railways in Africa. The African leaders indicated to the Indian authorities that they should not look at Africa simply as a source of raw materials but should invest in the continent's human capital and share know-how and expertise with its nations. It will be in order to recall Mahatma Gandhi's brief observation that the "Commerce between India and Africa will be of ideas and services, not of manufactured goods against raw materials after the fashion of Western exploiters.
How India can have an edge over China in its role in African development• India in fact can play a more important role in the development of Africa than China. Former World Bank economist William Easterly in his book "The Whiteman's Burden" praised India's model of engaging Africa with a view to promote trade with Africa. The World Bank study of 2006 also observed that Indian firms are better placed in African markets than their Chinese counterparts. Compared to the Chinese firms which bring their own workers in Africa even for construction and other such works while the Africans are facing severe unemployment problems, the Indian firms which employ local manpower and engage even the managerial staff from the local market stand to gain advantage in the eyes of the Africans than China. • Looking at the mineral and energy resources of Africa, several major economic powers are trying to woo Africa to enhance their trade relations in the region. But African governments will want sustainable benefits from them to benefit the African citizens. India stands to benefit from this approach of the African governments by its policy directed at the economic development of Africa for the mutual benefit of both India and Africa.• India's policy towards partnership with Africa has a three pronged approach which is directed at information and communication technology, human resources development and deeper economic linkages between India and the African countries. This policy of India of African development will take both India and Africa to face the challenges of the 21st century.
Conclusion• India is going to play a very vigour role in the development of Africa in future. At the recently concluded India – Africa two day Summit which was attended by 14 African countries it was clearly seen that India is going to develop and aggressive strategy to play a higher role and show its presence in the region vis-à-vis China. India though a late entry to join its rivals in Africa, shows a lot of promised in a number of areas. Both India and Africa have taken a pledge to work together to meet the economic and political challenges facing India and the countries of the African continent. It has been clearly stated by India that Indo-African friendship will be based on equality, mutual friendship, respect and understanding to meet the aspirations of the people of this region. India Africa bilateral trade in goods and services have grown three times during the recent years but still there is a huge potential. India's constant economic growth at an average of 8% for the past four to five years is expected to do better in the coming decade. So there is optimism about India's contribution for the development of Africa and for Africa's growth prospects. • Alpha Qumur Konare, the Chairperson of the African Union has stated that India truly understands the needs and aspirations of the people of African countries. All African leaders are alike in their thinking that India is of great help in the fields such as health, information technology, communications and agriculture. Prime Minister Manmohan Singh has stated that India-Africa Summit has provided a framework of co-operation between India and Africa. Although many countries have already mad a good start in the region especially the former colonial power France and China, but many Africans feel France as a legacy of colonialism thrust upon them. Hence there are better chances for India to develop its trade relations with Africa which would go a long way for the development of mutual growth and prosperity of both Africa and India.
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