India Hosts 40 African Leaders in New Delhi, Promotes Investment
Indian Prime Minister Narendra Modi called for stronger cooperation between India and the countries of Africa last week at a summit in New Delhi that gathered more than 40 African leaders. Modi offered technology and economic opportunities to his African counterparts in efforts to compete with China’s influence on the continent. The third edition of the India Africa Forum Summit (IAFS), which meets every three years in New Delhi, came at a convenient time for India as China’s lagging economic growth might affect its investment in Africa. This window of doubt allows the south-Asian ‘Elephant’ to establish a larger presence throughout the region. According to Modi, these summits help to forge the alliances that India hopes to strengthen with countries like Nigeria or Angola, on whom it depends for natural resources.
India presents good arguments for playing a larger role in Africa’s economic engagement with the world. India-Africa trade figures have risen from 3 billion dollars in 2000 to about 70 billion dollars in 2014. Additionally, in the last year, Nigeria has become one of the top oil exporters to India, followed by Angola. Algeria and Mozambique also sell natural resources to the South Asian country.
Moreover, as India looks for more investment opportunities on the continent, analysts advocate that India has more to offer to Africa than China. Each year, thousands of Africans travel to India to seek medical treatment that cannot be performed locally. Indian hospitals believe they have an edge over China in matters of health due to the large and advanced Indian talent pool in the industry.
India is also investing heavily in education. In this area of cooperation, India’s widespread use of English grants it the upper hand when compared with China.
Some argue the driving goal of IAFS is not primarily to compete with China. Ashish Thakkar, founder of Mara Group, a pan-African multi-sector business services company based in Dubai, says that China, despite lagging economic growth, will continue to invest in Africa since this is where “growth is still happening and they (China) need areas of investment that will create great sustainable growth.” Thakkar adds that this does not leave much space for India because Africa’s demand for investment destinations will not falter anytime soon.
Regardless of what India envisions as its goal, it is likely that the strengthening of ties between India and Africa will slowly close the large disparity in African investment that exists between China and India. Rolling out a red carpet for over 40 African leaders in a three-day over-the-top summit may be India’s way of bridging the disparity.
Furthermore, IAFS is a part of a larger trend of increasing interest in investment and cooperation in the continent that will demographically ‘explode’ in the next 30 years. The United States celebrated an equally important summit a year and a half ago in Washington, when President Obama congregated most African leaders to discuss a wide range of issues through the framework of the US-Africa leaders summit. The BRICS countries (Brazil, Russia, India, China and South Africa) have also made important commitments to partnering with African countries in order to drive industry-specific growth and development.