Continual growth in commercial exchange between the Asian giant and many African countries. Closeness of ties that can be seen also in the diplomatic field with the opening of eighteen new Indian embassies on the continent.

Back in 2002, on 26 May, the Indian minister for Commerce and Industry, Murasoli Maran, launched the programme “Focus Africa” to exploit the enormous potential of the sub-Saharan region and create opportunities for economic development in the area.

Since that date, bilateral relations between India and the countries of Africa have continued to grow stronger, as shown by the figures for Indian exports to the markets of the continent which, in the two years 2016, 2017 reached 23 billion dollars against 14 billion in 2007 and 2008; in the same period, 2016-2017, African exports to India amounted to 28 billion dollars (in 2007-2008, they were worth 20 billion). The five leading African countries in exports to India are Kenya, Tanzania, Egypt, South Africa and Nigeria. The latter, between 2010 and 2015, was the main trading partner of New Delhi on the continent.

At the World Economic Forum held at Davos in 2014, India and Africa established the ambitious goal to be reached before 2020 at 500 billion dollars worth of commercial trade. In 2017, the total value of trade between the two blocks amounted to 42 billion dollars.

This is certainly quite an achievement and Africa and India may improve upon it by developing the entrepreneur sector which is one of the key indicators to measure the performance of the two blocks which have not yet completely made use of their commercial potential due to a series of obstacles.To increase the volume of exchange, New Delhi is very much turning its attention to the countries of East Africa where planned incentives by local governments have induced an increasing number of Indian investors to enter the markets of the region.

The five-day trip carried out in late July by the Indian Prime Minister Narendra Modi to Rwanda, Uganda and South Africa, is a clear indication that the country is more than willing to undertake new commercial activities in Africa where the New Delhi government intends to implement 118 lines of credit to the value of eleven billion dollars in more than forty countries.

Modi’s African tour marked the first ever visit of an Indian head of state to Rwanda during which Delhi announced two credits for a hundred million dollars to develop industrial estates, expand the special economic area of Kigali and to develop the plan for the mechanisation of agriculture in the country.

Also in the Rwandan capital, Prime Minister Modi signed six agreements that include the modification of the 2007 Memorandum of Understanding on cooperation in the sectors of agriculture, animal and military resources, cultural exchanges, the dairy industry and on a broad field of commercial cooperation.

The India’s interest in Africa is not simply economic, as demonstrated by the announcement by the Indian Prime Minister, in a speech made to the Ugandan parliament on 25 July, of India’s intention to open 18 new embassies in Africa.India is also conducting a fifth round of negotiations with Mauritius to reach an agreement on free exchange involving the reduction of import tariffs on goods.

The general lines of the agreement called the India-Mauritius Comprehensive Economic Cooperation Partnership Agreement (CECPA) will include the exchange of goods and services, the resolution of controversies, economic cooperation and the elimination of technical obstacles to commerce.

It must however be noted that the reduction of tariffs on goods imported from the Indian Ocean archipelago will have little effect since on the island nation only about 6% of goods are subject to customs duty. Nevertheless, given that Mauritius is only one of the 44 African countries that signed the historic agreement last march in Kigali creating an African continental free trade area (AfCFTA), New Delhi hopes that a commercial agreement with the country may open the door to the rest of the continent.

Mario Cochi
Political Analyst