Wednesday, April 9, 2008

Two Giants, one destination- Africa

The race to Africa between China and India is now heating up. Two of the world's fastest growing economies are now also the two economies with consistently increasing trade relationship with Africa. India's trade with Africa has increased from 5 billlion USD in 2002 to 32 billion USD in 2007. India extends 500 million USD to credit to Africa every year! On the other side trade between China and Africa is at 40 billion USD in 2006, a 40% rise over the previous year.
Indian TATA steel is investing 1.5 billion USD in Cote D'Ivoire in an iron ore plant. An Indian company Taurian Resources won a contract to mine Uranium form 3000 Sq Kms, in the southern Sahara desert in Niger. Bangalore based Karuturi Networks, grows export quality roses in Ethiopia. 90% of all the diamonds sourced in Africa are finished in the Indian diamond finishing industry. With all this and a long historical relationship with Africa, China is still way ahead of India, in the dark continent in terms of investment.
The first India-Africa summit is currently underway in the India capital, New Delhi, with the aim of forging a strategic economic partnership between the two regions. Trade, investment, energy security and peacekeeping are top of the agenda at the summit. According to the South African Foreign Affairs Department, the government delegation will participate in the summit within the context of strengthening Africa - India relations in particular, Africa-Asia relations in general and to consolidate South-South co-operation.
In his inaugural address at the summit, Prime Minister Manmohan Singh announced that India would give preferential market access to 34 countries in Africa, which were among the least developed nations in the world. He called for turning the 21st century into a "century of Asia and Africa". India's commitment for overall development and progress, he said, was steadfast as it was keen to see Africa find its rightful place in the world.Prime Minister Singh described Africa as the "land of awakening", adding that the two billion people of India and Africa could set an example of "fruitful partnership."
India should however remember that it can use its strength over China, namely vastly skilled manpower to train the Africans in IT and other professions directly catering to trade in India. This kind of a relationship will beat the Chinese hands down. Merely an investment race will not pay off, as China is already ahead in the race.

2 comments:

Sita said...

Very good initiative from the Indian foreign affairs wing.

This partnership with Africa, if proven as a win-win situation will definitely take us much ahead of our close competitor China.

However,we should think of the issue in a broader perspective and start forming partnerships and improving relationships with other countries of the east as well.If we all work hand in hand, we will surely emerge as a super power over the west!

Hari said...

Another sector we can concentrate is engineering like you have mentioned. Our Foreign Affairs Department working in the right direction.