It’s time for Africa, in India. As the world navigates post-pandemic economic recovery, India and Africa are poised to scale up their economic partnership at a signature conclave in New Delhi that will explore new frontiers for enhanced cooperation in areas ranging from manufacturing, smart agriculture and clean energy to start-ups and forging regional production networks.
The sheer scale of the 17th CII-EXIM Bank Conclave on India-Africa Growth Partnership is staggering. Besides vice-presidents from half a dozen African countries, around 40 ministers from 17 countries will participate in the conclave to be held on July 19-20. The conference will be inaugurated by India’s Vice President M. Venkaiah Naidu and will feature special address by External Affairs Minister Dr S. Jaishankar and Commerce and Industry Minister Piyush Goyal. Trade ministers from various African countries will participate in a special session which will focus on promoting Business-to-Government (B2G) dialogue.
Mauritius’ Vice-President Marie Cyril Eddy Boissézon, Gambia’s Vice President Badara A. Joof, Zambia’s Vice President Mutale Nalumango and Deputy PM of Namibia Netumbo Nandi-Ndaitwah are among high-profile African leaders who will be participating in the conclave.
FOCUS ON GROWTH
This year around, the CII-Exim Bank India-Africa Partnership conclave has been rechristened as “Growth Partnership,” signalling a shift from project exports which dominated previous editions of the conclave for a decade and a half to growth partnership, which signals a more holistic and comprehensive approach to burgeoning relations between the two growth poles of the world. Growth partnership makes India and Africa major stakeholders in each other’s growth and prosperity.
The conclave is taking place at a time of renewed hope and resilience as both India and Africa emerge from the shadows of the pandemic to script new pathways of shared prosperity and resurgence. India has emerged as the world’s fastest growing major economy, and is expected to grow at 7.5% for 2022-23. Africa’s growth rate is expected to be 3.6 per cent per year, which is reasonable compared to many other regions of the world. “The ongoing signs of Resilience, Recovery and Renewal in India and Africa signal strong prospects for across-the-board transformation of the India-Africa economic partnership, with growth and inclusive prosperity as the twin mantra,” as a Background Note published for the conclave says.
The operationalisation of the landmark African Continental Free Trade Area (AfCFTA), which came into effect on January 1, 2021, is set to propel India-Africa trade and investment onto a higher trajectory. The AfCFTA is a great opportunity for Indian industry to establish businesses in Special Economic Zones (SEZs) in Africa and benefit from the wider market access that the AfCFTA will provide. The continental FTA is expected to enhance intra-regional trade from the current level of about 17% of Africa’s total trade to an estimated 52% in a five-year period, with removal of tariffs on 90% of the goods. The conclave will explore how the two sides can leverage synergies generated by AfCFTA to focus on bolstering regional value chains, which will play a pivotal role in promoting Africa’s industrialisation.
Development partnership remains the bedrock of burgeoning relations between India and Africa. The importance India attaches to nurturing relations with the continent is attested by $12.6 billion Lines of Credit extended by India to African countries for an array of socio-economic projects in African countries. Under these LoCs, 193 projects have been completed and 66 projects are currently under execution and 88 projects are at pre-execution stage. These projects encompass various sectors ranging from drinking water supply, agriculture mechanisation & irrigation to solar electrification, power plants, transmission lines. Africa is the second largest recipient of India’s concessional loans.
THE ROAD AHEAD
The conclave coincides with a new bounce and energy in India’s diplomatic outreach to Africa. Since 2014, a record number of 34 outgoing visits by President, Vice-President and Prime Minister to Africa have taken place from India. This period also saw more than 100 visits from Africa at the level of leaders, ministers and officials. India has opened 18 new embassies since 2018, taking the total Missions and Posts in the continent to 49.
As China accelerates its inroads into the continent and launch a new charm offensive, Indian industry should harness unprecedented Africa outreach launched by the government to expand their operations in this rising continent of opportunity. India is the fifth largest investor in Africa with cumulative investments at $70.7 billion US (from 1996-2021). Bilateral trade is growing and was estimated to be $69.7 billion in 2018-19. The pandemic has reduced volume of trade, but latest signs suggest better times for India-Africa trade. It’s time to raise the bar and aims for $100 billion bilateral trade by 2025. Looking ahead, the leaders and business enterprises of India and Africa should focus on fusing India’s growth story with African-owned and African-led resurgence to unleash entrepreneurial energies of Africa. India’s engagement with Africa “will be on terms that will be comfortable for you, that will liberate your potential and not constrain your future,” said Prime Minister Narendra Modi said in his famous address to the parliament of Uganda in 2018, while enunciating 10 principles of India’s engagement with Africa.