Beyond China and Africa: a focus on India

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LogoIn the second of our ‘beyond China and Africa’ series, Pooja Jain explores India’s attempts to forge connections with Africa in aid, trade, and diplomacy. Pooja Jain is a PhD candidate at the Sciences Po (Paris Institute of Political Studies). If you missed our earlier post on Brazil and Africa, you can read it here

One of the important questions that South-South cooperation raises in the field of international relations is whether it marks a return to realism or the construction of a new world order, based on horizontal relationships.

The cliché that India is a country of contrasts still holds true. On the one hand, it is a rising economic power and the ‘world’s largest democracy’. On the other hand, more than a quarter of India’s population live below the poverty line and 65% of its population is rural, living on uncertain, monsoon-driven agriculture. The development conditions in some of India’s federal states are similar to certain regions in Sub-Saharan Africa. Moreover, it has a mixed human rights record within its own borders. In particular, it has recently come under fire over the issue of gender inequality and gender-based violence. We can, therefore, expect that its relationship with Africa will be complex, and deserving of scrutiny.

Independent India has shared common ambitions and ideologies with African countries on platforms such as the Bandung conference in 1955, within the non-aligned movement, and in the G77. India’s Technical and Economic Cooperation programme (ITEC) covering 158 developing countries commenced in 1964, the same year the G77 was created, and an industrialists’ goodwill mission from India visited several African countries. In the 1980s, the current Prime Minister of the country, Dr Manmohan Singh, served as the Secretary General to the South Commission, the President of which was Julius Nyerere of Tanzania. More recently, connections between India and Africa have continued to grow, with the country developing aid and trade relationships across the continent, as well as making its presence felt through the UN, emerging as the biggest contributor to UN-mandated missions in Africa in 2008. But what is the nature of these growing aid and trade ties? And how will they affect the domestic and international standing of African countries?

The aid debate

Aid relationships between Western countries and Africa have often been criticized as being covertly neo-colonial. Potentially, as a formerly colonized power, and both a donor and recipient of aid, India can evade these critiques. Whilst authors like Deborah Brautigam would argue that aid is more efficient where there is a single or dominant donor, the multiplication of aid donors can be seen as a positive development because it shifts power towards recipient countries. Currently, donor countries decide both who will receive aid, and design aid policy.  Meanwhile, as Stephen Browne has highlighted, the failure of that policy is attributed to the consumers of aid. The emergence of donors like India from the South could lead to a ‘bottom-up’ approach to aid reform.

In practice, however, India’s development cooperation with Africa has been a contentious issue in aid debates. Srikant Dutt proposes several ways of analysing Indian Overseas Development Assistance (ODA). On one hand, he argues, it appears to be in conformity with the principles of UNCTAD (Conferences II, III, IV), which call for economic cooperation between developing countries. On the other, aid is also a strategic and economic tool for an emerging country seeking to reinforce its place in the world. As Inés Trépant points out, China and India are expanding their connections with Africa. In both cases this is, at least in part, driven by their need to secure a supply of raw materials (India imports 70% of its oil from Africa) and to find new markets for their manufactured products. In this light, it is unclear whether India’s willingness to avoid ethical, economic or social aid conditionality emerges primarily from a wish to avoid infringing on the national sovereignty of others, or an eagerness to forge links with resource-rich countries, regardless of their political regimes.

Moreover, as Harsh Sethi highlights, India’s self-interest does not just determine who receives aid, but how it is offered. Whilst India refuses any offers of tied aid from others donors, it does not hesitate to impose such aid on countries less developed than itself. On the surface, this behavior seems blatantly hypocritical. Trépant, however, provides another possible perspective on the issue: The aid given by OECD member countries, she argues, has to be unconditional or else the recipient countries would be forced to buy expensive goods manufactured by the developed countries. Conversely, aid given by India or China, even though it is tied, is favourable to the recipient countries because the products manufactured by these countries are cheap and adaptable to developing countries.

India as a development partner

The Ministry of External Affairs is the chief organization for the allocation of Indian aid in the form of grants. Out of a total budget of $554m in 2010/11, only $32m was allocated to Africa. During the second India Africa Forum, the Indian Prime Minister Manmohan Singh announced the allocation of $5bn in the form of loans to Africa over the next three years. Out of the previous announcement of $5bn made during the first forum held in 2008, $2bn have already been allocated, according to Mr. S.M. Krishna, India’s foreign minister.

Funding has been particularly notable in the areas of education, infrastructure and technology. During the second India Africa Forum, it was announced that $700m would be allocated for the establishment of institutions for the academic and professional training of Africans.  From 2011 onwards, 75 students each year will be enrolled to study in agricultural universities in India. Currently, 49 African students are studying in various agricultural universities in India. In addition, following a recent agreement, the state of Andhra Pradesh will be sending 500 farmers to Kenya, Uganda and Ethiopia to become ‘farm entrepreneurs’.

Turning to transport, India has announced the construction of a railway line between Ethiopia and Djibouti involving an investment of $300m. This focus on infrastructure, with a view on trade, is echoed in China’s relationship with Ethiopia and the latter has also been involved in the construction of this regional railway line. In another bid to facilitate trade and exchange between India and Africa, the Prime Minister invited African airlines to fly to Indian cities and the government has launched a pan African e-network project, which aims to connect countries across Africa by fiber optic network. This network will provide tele-medicine, tele-education and satellite connectivity. Currently 47 countries have signed the agreement for the e-network and in 34 countries the project has already been implemented. In addition to this investment through the Ministry of External Affairs, India acts as a member of various Regional Economic Committees in Africa and an active participant and shareholder of the African Development Bank and the Development Bank for West African Countries (BOAD).

In total, India’s trade with Africa now stands at more than $46bn with a target to reach $70bn by 2015. The Indian Chambers of Commerce have been active in their engagements with Africa. The Confederation of Indian Industry/ Exim Bank  Conclave on India-Africa Project Partnership has been running annually since 2005. In March 2011, the seventh conclave was attended by 650 delegates from 40 African countries. 204 projects worth $18bn were discussed during the meeting.  According to an UNCTAD report in 2007, India had 48 Greenfield foreign investments in Africa compared to 32 from China between 2002-05. However, relationships between Indian firms and the countries in which they operate have not always been free of friction. Mittal, for example, has been surrounded with controversy over its dealings in Liberia. There again, the identity of that particular enterprise is often questioned. Whilst it is owned and run by an Indian, the company is registered in Luxembourg, and not India.

India as a partner in international organisations

In international forums, India and Africa have adopted a common posture on the reform of the Bretton Woods institutions and the reform and expansion of the UN Security Council, as the proceedings of the India-Africa Forum Summit in 2008 and 2011 demonstrate. These reforms seek to adapt both institutions to better fit the current realities of the international order, and democratize their internal governance structures. India and Africa have also both been fervently speaking out against unfair trade practices, especially agricultural subsidies at the WTO.

However, it is again possible to view this collaboration more cynically. Africa represents an important vote bank for India, which has ambitions of becoming an leading actor on the world scene. A member of G20, the G4, BRICS and IBSA, India and other emerging powers in the South are said to overshadow less powerful states in Africa. For all the talk of South-South cooperation, organisations like the G15 often find themselves being relegated to the background. India’s relationship with African countries is far from exclusive and its alliances and coalitions within the continent could be read as simply an indicator of the interest-driven nature of international cooperation. Like aid, cooperation too is political.

Conclusion

Game theory scholars like Robert Axelrod have suggested that continued interaction between actors is needed for cooperation to thrive. The repeated interactions between India and Africa suggests that cooperation is, indeed, thriving. However, the question of who will benefit from such interactions, and how they will impact the political realities of everyday life across the continent is unclear. The potential for India’s presence to help democratize international relations as a southern partner is apparent. However, the degree to which this potential will be realized remains to be seen.

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