The Hindu Business Line : India must do a China in Africa

India for long has ignored resource-rich Africa. With China taking the lead, by investing heavily in industry and trade in Africa, India cannot afford to remain a spectator. A thorough overhaul of India’s Africa policy is needed.

S. Srinath

Indians in Africa have a long history spreading over centuries and Indian entrepreneurs have been establishing industries and trading units right from South Africa to Togo. For cultural impact you can hear street kids in Kano, a northern commercial hub of Nigeria, singing popular Hindi songs.

The story is similar in other leading cities in Africa. This historical bonding developed by the Indian business community was reflected in Jawaharlal Nehru’s speech in the Bandung Conference in 1955, when he said that Asia must play a bigger role in helping Africa “as we are sister continents”.

Unfortunately at the government level the interaction has been very low.

After Jawaharlal Nehru’s visit about five decades ago, there have not been any significant bilateral visits at prime ministerial level except for Dr Manmohan Singh’s recent visit to Nigeria.

Even Mr A. B. Vajpayee’s visit to Abuja, Nigeria, about a decade ago, was in connection with the Commonwealth conference and was not on a bilateral note.

After centuries of colonisation the continent is now grappling with the rule of oppressive dictators. The continent has not achieved anything significant economically in the post-colonial era. With living conditions being difficult, the intelligentsia have been migrating at a faster pace to the West.

Despite its reservoir of natural resources, Africa has not emerged as an economic powerhouse and has only managed to be a cluster of least developed nations. In addition to the neglect by the colonial masters, the sanctions imposed by the West time and again on dictators/coup leaders have only added to the misery of the already suffering common man in the continent.

China takes the lead

In such a political vacuum created by a policy of neglect by the West, China, in its search for minerals and oil, is trying to fill the void by helping any regime, be it good or bad, that would suit its economic and political agenda. As an emerging market and a leading developing nation India can ill-afford to be a passive observer of this region.

It must be noted that recently China hosted a conference of African leaders in Beijing and 48 of the 53 leaders attended it.

This is a significant development to be noted by New Delhi as China now is the second largest trading partner and, as a corollary, will have a stake in the political and cultural developments in the region.

The Chinese Government has taken up big projects, such as laying railways, arterial roads and national highways, thus laying the foundation for its commercial interests. The railway lines built in Zambia and the highway roads being built in Accra, Ghana are a part of this policy.

Economic cooperation zones

To ensure uninterrupted supply of raw materials for its ever-hungry industry, China has rolled out a timely strategic investment plan to build about five economic co-operation zones in Africa before 2009. This is likely to more than double the current trade level of $40 billion. The main aim of this economic co-operation zone is to train 15,000 African personnel to improve their economic condition, set up a $5-$6 billion Africa Fund to help start Chinese industries and create jobs and build strong cultural ties so that China remains, in the long run, an economic power which Africa would look up to.

One must remember that the Chinese oil requirement is largely supplied by Africa. Since 1993, China’s oil imports have increased by 40 per cent; Sub-Saharan Africa is a major supplier, with Angola taking the lead.

China consumes seven million barrels of oil per day. Not a single barrel comes from the UAE. Recently, China vetoed a UN plan for peacekeeping force in Khartoum, as it had acquired about 35-40 per cent of Sudan’s oil production facilities, an evidence of the political clout China enjoys in Africa.

Lessons for India

India too has to look at its economic interests in this region. The country needs oil and other natural resources. Africa can help meet our essential raw material requirements, especially that of cooking oil the supply of which continues to be uncertain.

Letting the Chinese take a lead in the region will hurt India’s larger economic interests and the policy on this front needs a thorough overhaul. It must be remembered that once the Chinese are entrenched there will be little elbow room for others.

India must view this development against its unsuccessful bid to get gas concessions from Myanmar, where the Chinese have established links with the military regime. This is in spite of the traditional cultural links we have with Myanmar. Here India lost out to China in the political game.

Now we see frequent visits of Chinese leaders to Africa with liberal grants from Beijing. Unfortunately our ministers line up for the flights to the West and pay little attention to the natural resources-rich Africa.

India can play an active role in areas such as agriculture, bringing about a white revolution, and helping establish a good marketing network for intra-continent agricultural produce as well as inter-continental trade.

Pulses production in the country has stagnated for over a long period now. A fertile African continent can help India on this front. Cultural exchange programmes must increase and there must be more bilateral visits.

India enjoys the advantage with the presence of a large business community across Africa.

The Prime Minister’s visit to Abuja and Lagos, followed by the Petroleum Ministry’s talks with its counterparts from Chad, Ethiopia and Comoros augurs well for the future. One hopes that this initiative is taken forward. India must not neglect Africa in the larger interests of economy.

(The author, a Chennai-based chartered accountant, is currently in Accra, Ghana.)

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