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Re-energising India’s Africa Policy

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June 29, 2021

What is the issue?

  • India-Africa trade and engagement is on a decline due to various factors.
  • Policy implementation in this regard needs a critical review as Africa is considered a foreign policy priority by India.

How significant is Africa to India?

  • India’s top five markets today in Africa are South Africa, Nigeria, Egypt, Kenya and Togo.
  • The countries from which India imports the most are South Africa, Nigeria, Egypt, Angola and Guinea.
  • India’s top three exports to Africa are:
    1. mineral fuels and oils (processed petroleum products)
    2. pharmaceutical products
    3. vehicles
  • Mineral fuels and oils (essentially crude oil) and pearls, precious or semi-precious stones are the top two imports.
  • The composition of the India-Africa trade has not changed much over the last two decades.

What is the current trade scenario?

  • In 2020-21, India’s exports to Africa saw a reduction of 4.4% over the previous year.
  • And imports saw a reduction of 25%.
  • Thus, bilateral trade valued at $55.9 billion in 2020-21, fell by $10.8 billion compared to 2019-20.
  • India’s investments in Africa too saw a decrease from $3.2 billion in 2019-20 to $2.9 billion in 2020-21.
  • Total investments over 25 years, from April 1996 to March 2021, are now just $70.7 billion.
  • This is about one-third of China’s investments in Africa.

What are the key reasons for the decline?

  • Africans have been deeply affected by the COVID-19 pandemic and remain ill-equipped to deal with it.
  • Africa experienced a sharpened international competition in the first two decades of the 21st century.
  • This was known as ‘the third scramble’.
  • A dozen nations from the Americas, Europe and Asia have striven to assist Africa.
  • In turn, they aimed to benefit from its markets, minerals, hydrocarbons and oceanic resources.
  • Thereby, they could also expand their geopolitical influence.
  • China successfully used the pandemic to expand its footprint by increasing the outflow of its vaccines.
  • Unfortunately, India’s ‘vax diplomacy’ has suffered a setback.
  • India had the geopolitical compulsion to concentrate on its ties with the UK, the EU, and the Quad powers, particularly the US.
  • Consequently, the attention normally paid to Africa by India lost out.
  • Given the condition in other countries due to the pandemic, flows of assistance and investment to Africa have generally decreased.

What is the way forward?

  • For mutual benefit, Africa and India should remain optimally engaged.
  • India's External Affairs Minister, in the UNSC's open debate on conflict and post-pandemic recovery in Africa, regretted that “the voice of Africa is not given its proper due.”
  • It is time to seize the opportunity and restore Africa to its primary position in India’s diplomacy and economic engagement.
  • Fresh financial resources for grants and concessional loans to Africa must be allocated, as previous allocations stand almost fully exhausted.
  • It is essential to impart a 21st century complexion to the partnership with Africa.
  • This means developing and deepening collaborations in health, space and digital technologies.
  • Also, to overcome the China challenge in Africa, increased cooperation between India and its international allies is important.

 

Source: The Hindu

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