“AN AMALGAMATION”

  • March 10, 2017

“The Conclave has become a prestigious event for Indian and African governments and industry to meet and explore new avenues of partnerships. The annual gathering enables the Indian and African leadership to take stock of the progress of the partnership and address future needs in this regard”.— Mr. Pranab Mukherjee, President of India

India-Africa, the next “Big Thing”?

Certainly so many forums and summits have been organized and are planned to be organized in the coming years, but what’s the hush about India- Africa association? The answer to this lies in the shared history of India and Africa. The association of India and Africa could be traced back to several centuries. The foundation of the relations between India and Africa was laid by Mahatma Gandhi. According to him, there will be a “commerce of ideas and services and not of raw materials and goods like imperialist powers”. The present government continues to take it as the foundation of Indo-Africa Policy. As per Vice President Hamid Ansari, “India shares Africa’s dreams and India Africa cooperation is genuine 2 way street partnership”. During the colonial period, there was a large immigration of Indian labour to work on the railways in East Africa, on sugar and other plantations in Mauritius, Madagascar and Southern Africa. The increase in the population of Indian diaspora in African countries resulted in increase of trade between their original homeland and their new-found habitat.

This relationship is a result of strong emotional link, which has been sculpted by the intersecting history, old ties of kinship, culture and commerce. Another factor is the quest for freedom against colonialism, which urges to take path of progress and establish on the global level as ‘one of the fastest growing economies’. India and Africa contribute to one-third of the world’s population, amongst which majority of them are youth, which is a significant share of the global youth population in the coming years. India and Africa both are on the path of constant progress. Let it be commerce, politics, infrastructure or basic healthcare. The association would be a significant source of strength and motivation and economic development for each other. It would also result in building up equitable and sustainable world. There’s a saying “Where there’s a will there’s a way” and it applies to African vision of growth and development. Africa’s development in the recent years has been very impressive.

The two main contributors of this amalgamation have been the CII, the Confederation of Indian Industry and the EXIM (Export – Import) Bank. With the two of these godfathers, the conclave has proved to be a major success and a highly fruitful platform for both India as well as Africa.

CII- Exim Bank Conclave

This story began in 2005, when the Indo- African bond was strengthened through the medium of CII- EXIM Bank Conclave. The initiative was launched by the CII in partnership with EXIM Bank of India and with the support of the Ministry of External Affairs and the Ministry of Commerce & Industry, Government of India, with H.E. Mr. Jean Pierre Bemba and Vice President of D R Congo as the first ever honorable guest for the occasion. The cordial relations between India and various parts of Africa were solidifying through this medium of CII EXIM Bank Conclave. Over the last eleven editions, it has emerged as one of the pioneering events in building partnerships and enhancing the economic engagement between the two regions.

Objectives and Approach

The two main contributors of this amalgamation have been the CII, the Confederation of Indian Industry and the EXIM (Export – Import) Bank. With the two of these godfathers, the conclave has proved to be a major success and a highly fruitful platform for both India as well as Africa. The CII- EXIM Bank Conclave on India Africa Project Partnership emerged as a systematic and focused approach to work on projects in Africa and has been a great opportunity to be able to build a bridge between Indian and African business leaders as well Senior Government officials. It is the largest assembly of senior ministers, policy makers and business leaders from different sectors of Africa and India. The objectives guiding the journey of growth of the Conclave have evolved and developed with inputs and recommendations received at each Conclave. In the event’s reports of 2005-10 by CII, the CII Conclave is guided by the following objectives, and works towards:

Promoting partnerships at the three levels

  • Government
  • Institutional
  • Enterprise

Increasing outreach of information

  • On Indian enterprise in the identified sectors to Africa
  • Increasing interaction between the Indian industry and Africa to address specific opportunities.
  • Discussing possibilities for Indian participation in long term projects
  • Initiation of programs related to capacity building including resource mobilization for the same.
  • Building upon the momentum gathered with the launch of the “India Africa Forum Summit” and take forward the actionable agenda put forward during the deliberations.

Among the growing number of participation, the three categories that can be distinguished clearly are that of:

  • Business seeking solutions, technologies and projects.
  • Government representatives and often policy makers who are clearly seeking inputs from the business delegates to look at creating enabling environment and facilitate two way investments and trade with their country.
  • Banks and financial institutions, which facilitate business and projects in the African countries.

Step by step

According to reports published by the CII- Generally, the annual CII Conclave is supported by the output of the Regional Conclaves organized by CII in two or three different hubs in Africa. At these hubs CII invites the participation of the countries from that region and facilitates interaction with Indian business delegates who travel out. Since 2005 to 2010, CII had organized around 13 Regional Conclave in Zambia, Ethiopia, Ghana, Mozambique, South Africa, Cote d’Ivoire, Uganda, Senegal, Tanzania, Namibia, and Nigeria.

There have been many cases of Indian Companies looking for business opportunities that go beyond the Government of India lines of credit.

This conclave along with CII had also initiated dialogue with the other financial institutions in the African region with competitive credit facilities to support business efforts by the Indian companies. The essence of the CII Conclave has been to encourage Indian exporters to access the African countries and increase their presence in the region. Another parameter to measure success in this is the number of people that attend the CII – EXIM Bank Conclave. Whereas, the other measure is the number of MOUs that are signed and the value of projects that are discussed.

Till 2010, the conclave had achieved remarkable results of 1084 projects worth $56.08 billion (US) that had been discussed which had also contributed towards over 400% growth in bilateral trade in the just 5 years. These multiple targets of increasing trade, investment and developmental activities require sustained and concentrated effort. The effort from CII had been keeping up the momentum and keeping the African agenda on the forefront of Indian exporters. CII has continuously created programs and platforms to encourage Africans to meet with Indian partners. Breaking perceptions and creating confidence has been the first step in increased business engagement. The increasing participation of the African nations in the CII led Conclaves and the growing relevance of the platform has given shape to policy dialogues of the Government of India, EXIM Bank and the industry.

From 2005 – 2010

The annual conclaves held in New Delhi during 2005-10 had facilitated the enhancement of Indian project exports to African markets apart from strengthening “Brand India” amongst the African decision makers and business leaders. The growing India-Africa economic exchanges bear testimony to the tangible benefits that had accrued from the high profile engagements at the conclaves. The India growth story had found a significantly larger following in Africa in this period evidenced by the growing participation of key African delegates at the annual conclaves.

Coming from Conclave’16- India and Togo

High-level government and business delegations participated in the CII-EXIM Conclave on ‘India-Africa Project Partnerships’ held in November 2005 and October 2006 in New Delhi and in May 2006 in Accra. Minister of Cooperation and NEPAD of Togo led the Togolese delegation for the CII Conclave in October 2006. Prime Minister, Mr. Gilbert Fousson Houngbo led a Togolese delegation to the 6th CII-Exim Bank Conclave in India in March 2010 and the 12th Regional Conclave on India-Africa Project Partnership in Accra on 3 June 2010. According to the reports regarding the last conclave there were following crucial points that were discussed.

Commercial Relations – India and Togo

  • India had provided economic assistance to Togo in the form of tractors (60), water pumps, sewing machines, ambulance, transport vehicles, corn-grinding machines, etc. On the request from the Togolese government, indelible ink was supplied in 2002 for elections held in Togo. India had also sent a consignment of medicines required by the flood affected people in 2008
  • The Synthetic & Rayon Textiles Export Promotion Council (SRTEPC) of India organized a 2-day Indian Textile Exhibition (INTEXPO 2013) in March, 2013 in Togo. This first ever exhibition received good participation from local companies/traders.
  • The Indian Institute of Foreign Trade (IIFT), New Delhi, in collaboration with the Chamber of Commerce and Industry of Togo, organized an Executive Development Program (EDP) in Loméin August 2013. It was attended by 69 participants from the Government, Public Sector organizations and private businesses. A two-member delegation from Apollo Hospitals visited Togo in March 2015 to explore opportunities in the health sector.
  • Togo signed the Country Agreement with TCIL for the Pan African E-Network Project in 2008, which was implemented. India had offered to set up three other projects, viz. Human Settlement Centre, an India-Africa Centre for English Language Training, and an Agricultural Seed Production-cum-Demonstration in Togo under the decisions of the India-Africa Forum Summit (IAFS). Secretary, Indian Council for Agricultural Research (ICAR) led a 3-member delegation from India for discussions with Togolese authorities on the setting up of Agricultural Seed Production-cum-Demonstration Centre in Togo in December 2013.
  • India’s major exports to Togo include mineral fuels, mineral oils and products of their distillation; cereals and preparation of cereals cotton; articles of apparel and clothing; iron and steel articles; man-made filaments; man-made staple fibers; drugs and pharmaceuticals; machinery & mechanical appliances; plastic and articles thereof; rubber and articles thereof; vehicles and parts and accessories thereof, etc. Imports from Togo include natural phosphates, ferrous and copper waste and scrap; wood and articles of wood; other metal scrap; oil seeds; coconuts & Brazil nuts etc.

ITEC

India offered training in human resource development under the Indian Technical & Economic Cooperation (ITEC) Program. It utilized 35 slots allotted in the FY 2012-13 while in the last FY 2013-14, 37 slots were utilized. It has been allotted 50 ITEC slots for the FY 2014-15, of which 35 slots were utilized. In addition to the above, 6 Togolese scientists travelled to India between June and December 2013 for research studies under the CV Raman Research Fellowships Scheme.

Indian community

Indian community in Togo is small and there are about 200-300 Indians living in the country. Most of them are businessmen engaged in trading, assembling, running super markets, hotels etc. The community has an Association though not very active due to the small size of the community. The International Day of Yoga was organized on 21 June 2015 with a participation of about 150 people from different walks of life.

A path for mutual development

Africa’s development is a great opportunity for India to grow. The continent’s progress will add great stability and momentum to the global economy and benefit India as well. There are enormous opportunities for investment and trade partnerships between India and Africa. India has concentrated on developing the partnership in human resource development and establishment of educational institutions in Africa, which in turn, are creating the skills capacities in Africa, including areas like food processing, agriculture, small industries, textiles, etc., to expand exports to India and other countries. The trade relations between India and Africa have further strengthened of India’s decision, taken in 2008 to offer duty free access to Indian markets to all Least Developed Countries, in the context of the first India-Africa Forum Summit.

Bond-strengthening commodities

Data from the Indian government and the African Development Bank portrays that bilateral trade between India and Africa increased from $1 billion in 1995 to $75 billion in 2015. Overall, since 2010, India’s exports to Africa have increased by 93% while imports rose by 28%, according to Africa-India: Facts & Figures 2015, a joint publication of the United Nations Economic Commission for Africa (ECA) and the Confederation of Indian Industry (CII). Africa’s share of India’s global exports elevated from $17.9 billion in 2010 to $34.6 billion in 2015, according to the report.

Exports from Africa usually includes raw materials, including oil and minerals, while exports from India generally includes manufactured and finished goods, including transport equipment, industrial machinery and pharmaceuticals. Nigeria, South Africa, Kenya and Tanzania are the most important destinations for Indian products in Sub-Saharan Africa. Oil is also one of the critically significant commodities, which forges the economic relations between India and Africa. According to the facts provided by CII (Confederation of Indian Industry) South Africa, India is the world’s fifth largest consumer of oil and will be on third position by 2030 due to the intense population boom. Currently, India is dependent on the Saudi Arabia and Iran for most of its oil supply, and these two countries contributes to over 70% of India’s oil supply. India has been working hard to grow its relations with major oil-producing African countries, including Nigeria, Ghana, Equatorial Guinea, Côte d’Ivoire and Sudan. India also imports coal from South Africa.

According to reports, India’s import of crude oil from Africa has increased from 22 million tonnes in 2004-05 to over 35 million tonnes in 2010-11, which is expected to increase at an alarming rate in the coming years. Africa is potentially a huge source of nuclear energy. This potential is also attracting India’s interest in the region. Uranium mining, is another area that has elicited great interest from Indian companies. India is exploring uranium mining opportunities in Niger and Namibia. Africa is also a major source of India for precious metals and gemstones such as gold and diamonds. India is the world’s largest processor of diamonds, accounting for 85 percent in terms of volume on the total world market. Gold in particular defines India’s economic relations with South Africa, the latter being the world’s leading supplier of gold.

Agribusiness is another significant sector which has the potential to boost up Indo-Africa economic relations. Indian investors have also prepared their plans to spend $2.5 billion on millions of hectares of land in East Africa, to grow produce such as maize, palm oil and rice for export, mainly to India. India’s investments in Africa continue to expand and flourish. For instance, Bharti Airtel, the New Delhi–based giant telecommunications company, is an evident example of India’s extensive private-sector presence across the continent. The company has been the market leader in 18 African countries since it entered the market in 2010 after taking over operations from Kuwait’s Zain Telecom in a deal valued at more than $10 billion at that time. With over 76 million subscribers as of March 2015 and a workforce of about 5,000 people, Airtel is now the second-biggest telecom operator in Africa. Some more major Indian companies operating in Africa includes Arcelor Mittal (steel products and iron mining), Essar Steel (steel products), Coal India, Vedanta Resources (copper and other metals mining), Varun Industries (rare earth minerals), Jindal Steel and Power (steel and energy) and Apollo Tyres (tyre manufacturing and distribution).

As the relation between India and Africa continue to deepen and flourish, the partnership of India and Africa would undoubtedly keep on writing new chapters of progress, hence framing more and more success stories of development. The association of these two would not only prove to be fruitful in terms of growth and development, but would also serve as the platform for more such future collaborations and tie-ups.

Leave a Reply

Your email address will not be published. Required fields are marked *