India-Africa Relations: Looking to the Future

India-Africa Relations: Looking to the Future

The October 2015 India-Africa Summit foreshadowed the possibility of a seismic shift in African foreign relations. Never before had the summit brought together so many high-profile African leaders with their Indian counterparts. While the Banjul Formula had determined who represented the continent in the past, this year, all fifty-four African countries were represented. The summit served as a crucial stepping-stone in presenting India as more of a credible partner in Africa.

African countries have a common strategic interest in securing investments to spur development. Unfortunately, dire social situations in parts of the continent continue to hold back development. Poor leadership and mismanagement of resources consistently plague some African countries, while a failure to uphold democratic ideals and maintain peace and security has greatly hindered progress in others. The ever-growing threat of extremism remains in some parts of Africa. In most parts of the continent, a lack of reliable access to electricity and energy continues to stagnate development. At the same time, healthcare and education systems still lag behind those of more developed nations.

However, where the average minds see gloom and doom, visionaries see opportunity and envision prosperity. Africa possesses a vast wealth of natural resources and minerals, and the continent’s oil and gas potential will grow significantly over the next two decades. Six of the top ten global discoveries in the oil and gas sector in 2013 were made in Africa, and untapped potential remains – if resources are managed appropriately.

The IMF predicted earlier this year that 100 million people in the region—out of an overall population around one billion—will fall within the working ages of 15 to 64 years in 2035, almost double the number added by the rest of the world. Surely then, there is no shortage of manpower in Africa. Ensuring the quality of the workforce remains of the utmost importance, and this can only happen through the education of the masses and a dedication to real human development.

Massive growth potential exists throughout the continent. Between the periods of 1990 to 2010, Nigeria’s telecommunications user base grew to be one of the largest worldwide. Rwanda, a country only twenty years removed from bitter conflict, has become a leading producer of coffee. South Africa, as part of the BRICS group of emerging national economies, continues to grow globally.

It is against this backdrop of enormous growth potential that India, a developing giant, seeks to expand ties to Africa. This matters, as India is rapidly rising, harboring the dual ambitions of competing against China in emerging markets and increasing its clout around the world. Africa will reap benefits from increased business cooperation with India and China, the two most populous countries in the world. Indian Prime Minister Modi recently promised $10 billion in new credit and $600 million in grant aid to African countries, though China remains the continent’s largest trading partner by a long shot.

China has historically been accused of taking advantage of the continent’s natural resources. In the Ghanaian experience, there is a clear lack of quality in many of its infrastructure projects—uncompleted roads, poor finished products—along with low-quality imported Chinese machinery and goods. The Chinese have also been accused of harboring an unwillingness to work with and train Ghanaian workers, instead opting to utilize Chinese workers. If India wants to grow in stature on the African continent, especially in competition with China, it must learn from China’s misdeeds and ensure that it values the trust of Africans.

Over the last fifteen years, India-Africa trade has gone up 20 times, having reached $70 billion. If this trend continues, and Indian interests are well placed with resources efficiently maximized, the country will gain a stronger foothold in Africa. India is working to build up its persona of being a credible partner and voice of the resurgent developing world fighting against the international status quo. The October India-Africa summit confirmed this; so too have Modi’s attempts to lobby how the UN is governed, advocating for changes to the Security Council to better reflect current geopolitical realities. India stands as Africa's fourth largest trading partner, lagging behind China, the US, and the EU. The country thus has quite a bit of catching up to do, but if Modi manages to gain the trust of African leadership, it will reflect positively in years to come. 

For Ghana, it may be the time to work closely with investors to push another much-needed agenda - the “Made in Ghana” agenda. Leadership must not lose sight of this agenda, as Ghana will only be able to galvanize its economy if firms expand into the country, investing in proper development of resources without exploitation, opening up jobs, and expanding educational and technological opportunities. The balance must be struck so that Indian competitors do not push out domestically owned small- and medium-sized enterprises. In this manner, everyone will be winners.

African leaders must ensure that as they continue to increase trade and investment with India, they remain vigilant and dedicated to preventing any influx of sub-par goods into the continent. Pharmaceuticals and manufactured goods must be of the highest quality. African countries must find other points of cooperation in this increasingly global environment as they remain dedicated to opening up new channels of investment and cooperation. If the countries (particularly Ghana) manage to move past their current situations of power depravity, they will make huge leaps forward. If they manage to educate their people to the point where complete literacy and diverse education for the masses is the norm, they will make tremendous leaps forward. In all cases, African countries must move past positions of weakness and take advantage of their strengths. These are not utopian goals, but ideals that these countries must recognize that they stand no chance of progressing without.

A Facelift for Case Center

A Facelift for Case Center

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