India is Africa's second-largest trading partner after China, and the gap is narrowing. The two Asian giants are extending overtures and outreach to African nations, prompting speculation they are competing for power and influence. A recent trip to Kenya by the Indian External Affairs Minister S Jaishankar is being seen in that context. Kenya is the gateway to the African continent and strategically located in the Indian Ocean Region (IOR). New Delhi is eager to consolidate its outreach in Africa to cut down Chinese heft in the economic and political arena.
India can’t achieve the same level of influence as China and it can’t hope to compete with Chinese spending power either. However, India is trying to consolidate ties with its outreach through sustained and regular bilateral, regional level engagements to reinforce its credible image as one of Africa’s foremost development partners. During the pandemic, India kept its medical supply line open and exported vaccines apart from ensuring maritime security in the Indian Ocean region.
India and South Africa joined hands to get a patent waiver for the vaccines at the World Trade Organisation (WTO) to augment developing countries’ capacity to produce COVID-19 vaccines. The move has been endorsed by the US, which has been accused of hesitancy in exporting surplus vaccines to poor nations to control the global pandemic.
According to the External Affairs Ministry statement, India has gifted 150 metric tons of medical aid to 25 African countries. Under the ‘Vaccine Maitri’ initiative, India has supplied 24.7 million doses of Made in India COVID vaccines as grants, and commercial and COVAX – global sharing vaccine supplies to 42 countries in Africa.” Although these supplies halted temporarily, the Serum Institute of India (SII) expects to resume the export of AstraZeneca doses from July onwards.
The trade and investment partnership has also been growing in recent years. Indian-African trade has grown from $51.7 billion in 2010-2011 to $66.7 billion in 2019-2020. During the same period, Africa’s exports to India have also increased by around $5 billion. About 8 per cent of India’s imports are from Africa, and 9 percent of Africa’s imports from outside the continent are from India. Indian public and private sector enterprises are also investing in Africa, making India the eighth-largest investor there.
Unlike non-transparent lending from China, Indian lines of credit are very transparent and non-conditional. India has extended a huge amount of developmental assistance through concessional lines of credit, grants, and capacity building initiatives. From 2002 to early this year, India has cumulatively extended $11 billion in concessions to the continent. That’s besides aid grants in the hundreds of millions and scholarships to African students.
By comparison, China is Africa’s largest trading partner, the value of Chinese-African trade in 2019 was $208 billion. Chinese overseas investment in Africa, in all sectors, as of 2020, totalled around $150 billion. Despite a gloomy picture of the global market, China-Africa trade was approaching US$180 billion in 2020. Although it is lower than US$208.7 billion in 2019, in comparison with other countries, China will remain the biggest trading partner of African countries for the 12th year in a row.
However, trade with China faltered following the coronavirus outbreak, leading to shortages and inflationary effects. Chinese workers left projects in African countries due to concerns about the pandemic’s spread. Chinese lending to Africa, which has been a key aspect of Africa-China cooperation, seems to have fallen due to the pandemic and is likely to reduce further. This can enable India to chart its own course to maximise its engagement in the African continent, where a large diaspora population can provide an important channel to reach out to decision-makers in the political, economic and business domains.