Issues Motivated for
Choosing the study

 

Geopolitical

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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 Peace keeping 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 co-operation.
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.

 

 

 

 

 

 

 

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

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.

 

 

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

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.

 

 

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

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
tele-medicine 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 (MNE’s), 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 CEO’s 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.

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