Indo-Africa trade relationships under the newly elected BJP Government in India. What will the future bring?
A picture of good things to come
In the aftermath of the 2014 elections and the swearing in of Mr. Narendra Modi as the Prime Minister of India, it is inevitable that from Africa, there will be some curiosity to know where the historically warm and friendly Indo-Africa relationship ranks in his Government's foreign policy. Mr. Modi comes into high office with a reputation as a business friendly leader and one who has made Gujarat, his home State,
into an enviable business hub. This curiosity is well anchored: parts of Africa are home to a significant Indian Diaspora just as geography. has assisted to narrow the gulf between East Africa and Western India.
The volume of trade between India and Africa is projected to be US$ 90 billion by 2015 and this projection may be augmented by the empanelling of the India Africa Business Council (jointly headed by Mr. Sunil Mittal and Alhaji Aliko Dangote). India makes up the quartet of countries and regions with the largest trading footprint with Africa – the EU, the USA, China and India. just as in the bid for strategic alliances and friendships, it's a straightforward, if uneven race, in Africa is one between China and India.
Domestic economic policy, easily dominated the minds of the Indian electorate and foreign policy apparently did not secure much traction. It is therefore an open issue how Mr. Modi's government may rate Africa. However India has emerged as one of the epicentres of the gradual eastward shift of global economic power, albeit, nowhere near its optimum capacity. Energy (particularly, oil & gas) is central to the growth of any economy and so it is with India. In its own case, it lacks the significant energy endowments necessary to fuel its growth and has therefore had to look abroad for supplies. Nigeria, Mozambique, Angola, north Africa have in the past period proven to be key suppliers of India's energy needs. Few cultures are as intricately inter-woven with gold as India and it has equally had to rely on mines from abroad to supply its needs. In either case, both the oilfields and mines of Africa may soon be working overtime should there be a spur in India's presently dulled economic rate. These developments should be of particular interest to Nigeria which has, since 2013, emerged as India's biggest business trading partner in Africa and more recently, as Africa's largest economy.
The unfolding scenario easily suggests that Nigeria may have an opportunity to deepen the relationship with Mr. Modi's India. According to the former Indian High Commissioner to Nigeria, Ambassador Mahesh Sachdev, direct bi-lateral trade between Nigeria and India was worth $16.67 billion in 2012-13.
During the preceding five years, bilateral trade has doubled and Indian exports tripled. Nigeria has emerged as India's second largest supplier of crude oil outside the Gulf. Nigeria has also become a large market for Indian consumables: vehicles, machinery and pharmaceuticals. Nigerian patients are notable medical tourists to Indian hospitals.
Despite a surge in Indian exports, Nigeria enjoys an annual bilateral trade surplus of nearly $11 billion. Over 100 Indian companies have footprints in Nigeria, with cumulative investments of over $10 billion, creating capacity and jobs - priorities for Nigeria.
Regardless of occasional differences, Indo-Nigeria relationship is mutually beneficial and it's hard to imagine anything will be done to undermine its promise now and into the future. Yet, the situation requires a measure of tendering to maximize its benefits.
In the recent past, the Indian Ministry of Commerce and Industry working with the Federation of Indian Chamber of Commerce and Industry (FICCI) had in October 2011, convened the 2nd Africa-India Forum Summit in Addis Ababa, Ethiopia. The summit itself was a further testament to the widening scope of cooperation between both sides. While the summit has apparently not been convened with the regularity which it so richly merits, the period ahead under a new Indian Government offers an opportunity to reshape the contours of that relationship.
Looking back, India and Nigeria have always enjoyed a warm and friendly relationship. This can be gleaned from historic antecedents shared by both countries. India established a diplomatic mission in Nigeria in 1958, even before Nigeria became independent in 1960.
Both countries have been in the forefront of the worldwide anticolonial and anti-apartheid struggle and have collaborated in various international fora. Similarly, historic State visit to Nigeria by Prime Minister Dr Manmohan Singh in October 2007 gave a new fillip to the bilateral ties.
Similarities in colonial struggle against British, large multi-ethnic, multi-religious and developing societies have created bi-lateral affinity. Both share common perspectives on international political, social and development issues and these have manifested in various meetings at UN, WTO, etc.
In light of the foregoing, India is not the sole suitor wooing African hearts and all the available evidence suggests that this is matter of some interest to India. In the event that we are actually able to gaze into that imaginary crystal ball, we may hypothesize that into the future, African countries, arguably, may more likely resemble India and less so, China.
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