Sunday, July 10, 2016

India wants Africa

Indian Prime Minister Narendra Modi is touring Mozambique, South Africa, Kenya and Tanzania. He is in search of raw materials and diplomatic allies in its quest for a permanent seat on the UN Security Council. South Africa has already expressed support for a revamp of the Security Council. India and the African continent account for one-third of the global population yet they do not have a permanent Security Council seat.

Concerns about democracy and human rights are not even on the periphery of such trade deals. India's state-run ONGC owns oil fields in Sudan and evidently regards Africa as a market with growth potential. Sudanese President Omar al-Bashir is wanted by the International Criminal Court on charges of war crimes and crimes against humanity, but at last year's India-Africa summit he was given a cordial welcome.

Since he came to power in 2014, Modi has been overhauling Indian foreign policy and expanding trade ties. In October 2015, African nations attended an India-Africa summit he staged in New Delhi. Now, he is travelling to Africa himself, visiting the four major countries on the continent's eastern coastline.

India is forced to import more than two-thirds of the oil and gas it consumes and more than a quarter of that energy comes from Africa. After Australia and Qatar, Mozambique is India's third largest gas supplier.

Whereas India has invested just 7 billion euros in Africa since 2008, China poured 23 billion euros into Africa, in direct investment, in one single year (2013). The volume of trade Africa conducted with India last year amounted to just a third of its trade with China. That could change. Chinese economic growth is losing steam and the slow-down will have an impact on trade, perhaps opening up new opportunities for India. The Indian economy is also expected to grow more robustly than the Chinese economy in the medium and long term. The country is already South Africa's sixth most important trading partner. India has already made a name for itself in the IT sector in Africa. Many Africans use the Indian telecoms provider Airtel and the company has a firm foothold in the market in more than a dozen African countries. India would like to expand still further in this sector. Major Indian companies are also active in other areas of the economy. The Tata group has been in Africa since 1977 and is now represented in 11 countries with its automobiles, hotels and telecommunications companies.

The presence of minority Indian populations, in southern and East Africa in particular, is also seen as another advantage for India when deepening ties to Africa. Modi's tour includes meetings with the Indian Diaspora in all four countries. South Africa is home to 1.3 million people of Indian origin.

No comments: