India pushes people power in
Africa By Sudha Ramachandran
BANGALORE - China has outpaced India in
the race for influence in Africa, but India has
signaled that it is not about to give up the
fight. During his recent visit to Ethiopia, Indian
Foreign Minister Pranab Mukherjee inaugurated an
e-network initiative that will enable Delhi to
reach out to people in Africa's 53 countries.
The pan-African e-network will allow
schools and hospitals across Africa to link up
with top institutions in India. The initiative
will bring Indian expertise in health care and
education to the African
people at low cost. Indian
diplomats will hope the initiative will earn the
Indian public and government goodwill and
influence in Africa.
India doesn't
necessarily lack for goodwill in Africa, however.
India's cultural and trade ties with the continent
go back several centuries, and its support for
decolonization and its struggles against apartheid
are well known.
However, its influence has
been dwarfed by China's. The 1990s saw a
downsizing of Africa's importance in India's
international priorities as the latter's
diplomatic presence shrank and the number of
diplomatic missions was reduced as personnel and
resources were shifted to Israel and the newly
created Central Asian countries. With the end of
the Cold War, India was focused on continents
further to its west - North America and Europe -
or to countries to its east and, in the process,
Africa moved to the margins of India's radar.
In contrast, China's interest in Africa
blossomed over the decades. Between 1955 and 1977,
China sold US$142 million of military equipment to
African countries, and trade expanded to touch a
record $817 million in 1977. China's trade with
Africa grew at 700% in the 1990s to touch $55
billion by 2006. China is now Africa's
third-largest trade partner.
China's
investment in Africa is massive. The bulk of it is
in the oil sector in countries such as Algeria,
Angola, Chad, Equatorial Guinea, Gabon, Nigeria
and Sudan. China controls most of Sudan's oil. It
is building roads, railways, harbors and
petrochemical installations in Africa. At a
meeting of the African Development Bank in
Shanghai last month, China promised to provide
about $20 billion in infrastructure and trade
financing to Africa over the next three years.
China has pledged to double development assistance
to Africa by 2009. Having already written off
debts of almost $1.5 billion in Africa, it has
promised to write off a similar amount again.
China's presence in Africa is enormous.
Consider this. China has 900 projects in Africa;
more than 800 Chinese companies are operating
there; it has sent 16,000 medical personnel to the
continent, offered scholarships to 20,000 African
students, and trained 17,000 African
professionals.
India became a regional
member of the African Development Bank in 1982 -
two years before China. But China holds more
shares in the bank and has greater voting power,
and it was in Shanghai, not Mumbai, that the bank
chose to hold its first board meeting in Asia
recently. It was India that helped several African
countries establish their military academies but
it is China that wields more military influence on
the continent.
China's economic and
energetic diplomacy in Africa stands in sharp
contrast to India's. China has more diplomatic
missions in Africa than even the United States,
and its leaders and officials swing through the
continent regularly. President Hu Jintao's visit
to Africa early this year was his third in less
than three years. Compare this with India's
performance. India has five diplomatic missions to
look after its interests in 25 countries in West
and Central Africa. Nigeria is an important trade
partner and among India's most important sources
of oil - 20% of India's oil is sourced here. Yet
the last Indian prime minister to visit Africa was
Jawaharlal Nehru in 1962.
Indian diplomats
insist that Africa is high on Delhi's
foreign-policy priorities today, and indeed, its
relations with Africa have grown. India's trade,
excluding oil, surged from $914 million in 1990-91
to a little over $9 billion in 2004-05. India has
firmed up deals with oil-rich Sudan, Nigeria and
Angola. ONGC Videsh, the overseas-investment arm
of state-owned Oil and Natural Gas Corp, has
invested about $720 million for a 25% stake in the
Upper Nile oilfield and plans to invest $200
million more in a 741-kilometer product pipeline.
Africa has about 8% of the world's known
oil reserves and 70% of its oil production is
concentrated in West Africa's Gulf of Guinea.
India has stepped up its diplomatic offensive
here. In 2004, India pledged $500 million in the
form of concessional credit facilities to eight
energy- and resource-rich West African countries -
Burkina Faso, Chad, Equatorial Guinea, Ghana,
Guinea-Bissau, Ivory Coast, Mali and Senegal -
which, together with India, form TEAM-9, the
Techno-Economic Approach for Africa-India
Movement. Six other countries have expressed
interest in joining the initiative.
India's strategy and strengths in Africa
are quite different from China's. China
concentrates on resource-based investment, while
India has focused on capacity-building. Indian
investments are largely private-sector, riding on
the back of the lines of credit given by the
Indian government, says Indrani Bagchi in The
Times of India.
According to Center for
Foreign Relations sub-Saharan expert Karen
Monaghan, "Indian companies are much more
integrated into African society and the African
economy." They hire locally and emphasize training
Africans on how to maintain and repair the plants
they build. Since Indian investments are generally
more equitable for the locals, locals have a
greater stake in Indian projects.
In
contrast, China has adopted a neo-imperialist
strategy in Africa, using mercantile economic
policies focused on resource extraction. Its
proximity to corrupt and unpopular leaders in the
continent could compromise its long-term
objectives in Africa. China is also unpopular with
many grassroots Africans, as evident from the
increasing attacks its workers and immigrants have
faced in countries such as Zambia. The Chinese are
not the only foreigners exploiting raw materials
in Zambia, but they are the ones who have aroused
the greatest hostility - and been attacked -
because of fears that the 30,000 Chinese
immigrants in the capital Lusaka are stealing
badly needed jobs.
India's strength lies
in public goodwill, China's in its deep pockets,
which it has dipped into often to swing deals in
its favor. For instance, in Angola, India had
almost closed a deal with Anglo-Dutch energy giant
Shell to purchase a 50% share in an
oil-exploration project and offered $200 million
in aid. But China managed to swing the deal in its
favor by offering Angola $2.3 billion for aid.
Impressed by China's successes in Africa,
India appears to be trying to replicate the
aid-for-oil strategy. In West Africa, India has
offered up to $1 billion toward power or
infrastructure projects in exchange for
oil-exploration rights and supplies.
In
2005, Mittal Steel and ONGC announced an
investment of $6 billion to establish a refinery,
power plant and railway lines in Nigeria through a
joint-venture company, ONGC-Mittal Energy Ltd
(OMEL). Under the mega-deal between ONGC and the
Nigerian government, OMEL would create the
infrastructure, while Nigeria would give it oil
blocks.
"The formation of the ONGC-Mittal
joint venture and its infrastructure project in
Nigeria are wholly in keeping with the modus
operandi of cash-rich Chinese companies,"
wrote Sushant K Singh in a recent Chatham House
paper titled "India and West Africa: A Burgeoning
Relationship". The OMEL deal "is seen as one of
the first examples of India's new approach in West
Africa".
Indian analysts warn that by
adopting China's strategy, India will lose public
goodwill.
"If India wants to avoid the
charges of 'neo-imperialism' that have been
directed against China, it needs to develop a
policy of sustainable partnership with Africa,"
strategic-affairs analyst Raja Mohan wrote the
Indian Express. "It must offer a radically
different model of aid and economic cooperation
that focuses on capacity-building and technology
and skill transfer to Africa."
For now,
China has the advantage in its match with India on
the African court. China's deep pockets are
determining the deals in Africa today. Whether
India will go the Chinese way in its Africa
adventure remains to be seen. The e-network
initiative inaugurated last week signals that, for
now, India favors its people-centric approach.
Sudha Ramachandran is an
independent journalist/researcher based in
Bangalore.
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