3. Динамика индийско-африканских отношений в ххi веке Changing Dynamics of India-Africa Relations

In the 21st Century

India’s involvement with Africa goes back a long way to the early days of independence movements in the 1960s and before. However, the current level and intent of India’s involvement is on a different plane. In those early days India had looked towards African countries within the context of an emerging Afro-Asian solidarity among Third World countries. Its presence was notable in infrastructure projects, with finance and building of railroads in East African countries, besides, its assistance in setting up small scale industries in Tanzania and Kenya, joint ventures in textiles, etc. In the next several decades India provided technical expertise, doctors, educational scholarships, and various other forms of aid, under the Indian Technical and Economic Co-operation program.

However, over the first decade of the 21^st century, the scope of India-Africa cooperation has increased rapidly, especially with India’s emergence as an important player in the world economy and India’s own significant need for oil and other natural resources. This is evident in India-Africa Forum Summits where India offered significant loans, grants and development assistance to woo African countries.

India’s engagement with African countries differs fundamentally from that of Western countries, particularly with regard to the aims, objectives and political discourse, besides the instruments and modalities of engagement. India’s policy towards Africa is based on a mutually beneficial basis, mainly on the agenda of South-South cooperation.

The strength of India’s relations with African countries and the source of much of its soft power are derived from more than just its recent growth in trade and investment. Throughout its history of cooperation with African nations, India has emphasized that it has “given what it could” in terms of financial aid and technical support and it continues to do so even as its ability to promote relations through economic incentives – primarily trade, tourism, and investment – has grown. India has actively pursued capacity building and a development agenda in Africa.

In the India Africa Summit, held in May 2011, involved 15 African countries. India committed itself to raising its credit line for businesses to US $5.4 billion, providing US $500 million in grants for development cooperation, improved market access to African exports, training for over 1500 Africans in Indian universities and improvement in defense cooperation.¹⁷⁹

Trade and Investment

The most important initiative that India has taken to advance its relationship with African countries is its Focus Africa Program. The Government of India launched the “Focus: Africa” Programme under the EXIM Policy 2002-07, the main objective being to increase interactions between the two regions by identifying the potential areas of bilateral trade and investment. Effective April 1, 2003, the “Focus Africa” programme was extended to cover effectively the entire African continent. Through this programme, Government of India provides financial assistance to various trade promotion Organizations, export promotion councils and apex chambers, Indian Missions in the form of market development assistance.¹⁸⁰ In 2004, India pledged $500 million in the form of concessional credit facilities to 8 energy and resource-rich West African countries: Burkina Faso, Chad, Equatorial Guinea, Ghana, Guinea-Bissau, Ivory Coast, Mali and Senegal – to help private Indian firms carry out development projects (Team -9).¹⁸¹

It is reported that under this scheme $280m worth of projects have already been approved against concessional lines of credit. These include $970 000 for the construction of a national post office in Burkina Faso, $30m for rural electrification in Ghana, $4m for a bicycle plant in Chad, $12m for a tractor assembly plant in Mali, and $15m for potable drinking water projects in Equatorial Guinea. Firms exporting to these markets are given ‘Export House’ status subject to a minimum export value of Rs 5 crore.¹⁸²

India’s active promotion of economic interaction with Africa is reflected in the significant increase in trade with African countries. While Africanists like Sanusha Naidu and others perceive India as ‘sleepwalking in Africa’, especially in terms of its trade partnership, signs are that India is awakening to the reality that Africa is a strategic market.¹⁸³ In fact, to facilitate trade, India strengthened the commercial wings of its African missions in 2003 as a trade promotion measure and to provide market assistance to African countries. To boost India’s trade through multilateral forum, the EXIM Bank of India has extended Lines of Credit (LOCs) to several regional organizations in Africa such as the Common Market for Eastern and Southern African countries (COMESA), Economic Cooperation of West African States (ECOWAS) and Southern African Development Community (SADC). These LOCs supplement the ‘Focus Africa’ Programme of the Government of India. At present, 66 LOCs are in operation, amounting to US $ 2.25 billion and covering 47 countries in the African region. These LOCs are seen as a facilitator for strengthening and expanding export trade between the respective regions and India through deferred payments terms. At the same time many of these LOCs are earmarked for infrastructure and related projects.¹⁸⁴ For example, India has given US$ 30 million line of credit to Mozambique for rural electrification project, US $50 million line of credit for the construction of the Itezhi-Tezhi Hydropower Project, and a $75 million soft loan in the social sector to Zambia, in 2010.¹⁸⁵

Table 1

India’s Trade with Africa. Values in US$ Million:

Year	1997-98	2002-03	2006-07	2010-2011
India’s total Export to Africa	1492.03	2516.12	8407.53	16281.17
India’s total Import to Africa	2081.77	2889.31	11362.76	26062.02
Total Trade with Africa	3573.8	5405.43	19770.29	42343.19

Source: www.commerce.nic

Table 1 shows that India-Africa exports have jumped from US$ 1,492.03 millions in 1997-98 to US$ 16,281.17 millions in 2010-2011, while imports have recorded US2018.77 millions to 26,062.02 during the same period. Indeed India’s imports from Africa increased as India’s demand for raw materials and oil increased sharply during this period. India’s imports from African countries are mostly primary goods and oil, along with gold and other minerals. Regarding India’s exports to Africa, chemical and pharmaceutical products, machinery, transport equipment, food and livestock, products etc occupy more prominent positions than manufacturing goods in 2010–2011.

India’s top ten trading partners are South Africa, Nigeria, Angola, Egypt, Ghana, Morocco, Sudan, Tanzania, Tunisia, and Kenya. South Africa is the major export partner followed by Kenya, Nigeria and Egypt. Commodities like gold and silver became very prominent as they accounted for two-fifth of total imports from Africa. It is evident from this that India’s import composition has changed dramatically over the past decade. A growing economy and an increasing gold consuming class of people have dictated this import structure. In fact, South Africa, the largest gold producer, accounted for 68% of India’s total import from Africa in 2004.¹⁸⁶

These trade flows are largely driven by economic complementarities between the two regions. This point has been advanced by Broadman in his book Africa’s Silk Trade in relation to Africa’s trade with China and India. He writes, “Although African exports to Asia as a whole do not exhibit a significant pattern of product diversification, inter-sectoral complementarities between Africa and Asia do exist. The rich resource endowment in Africa provides a natural comparative advantage in raw materials and resource-based products. China and India, on the other hand, have a rich stock of skilled labor compared to Africa and thus have a comparative advantage in manufactured products.¹⁸⁷

The India-Africa Forum Summit, held in May 2011, gave a new thrust to India’s engagement with Africa, with an increase in existing credit lines to Africa from US$ 2.15 billion to US$ 5.4 billion for 3 years. India has also approved duty-free access to 94% of its total tariff lines as well as preferential duty access to 92.5% of global exports to the least developed countries in Africa.¹⁸⁸

Apart from the Government, the private sector has also pitched in to explore the African markets, and now commands a significant presence in Africa. From the mid-1990s, organizations like the Confederation of Indian Industries (CII), the Associated Chambers of Commerce and Industry (ASSOCHAM), the Federation of Indian Chambers of Commerce and Industry (FICCI), and the Federation of Indian Exporters’ Organization (FIEO) identified Africa as a thrust area and launched programmes to promote economic and business cooperation. For example, to enhance trade the Confederation of Indian Industry (CII) regularly held the ‘Made in India Show’ to various African countries. With this show, CII encouraged Indian companies to display their products in textiles, drugs and pharmaceuticals, food processing, machine tools, auto components, construction equipment etc. to the trade and business representatives of countries from Africa. Moreover, FICCI has identified eight countries in Africa as top priority for India’s exports – Nigeria, South Africa, Kenya, Mauritius, Ghana, Tanzania, Algeria and Sudan. They have also listed the top 10 product groups for export to these countries, as a means to achieving higher trade growth. These countries were selected on the basis of their economic growth and improved political and economic stability, vast oil and gas reserves, and the ongoing restructuring of their economies. These initiatives have ensured an expansion of India’s trade with Africa.