From BusinessInsider. Story by Preetam Kaushik.
When he started his career 123 years ago in South Africa as a civil rights activist, could Mahatma Ghandi ever have imagined a scenario where India would be trading partners with all of Africa?
Ghandi went on to lead India to victory against colonial rule. Now, 122 years later, India is emphasizing the shared colonial past as heads of state and officials from 54 African countries convene in New Delhi for the India Africa Forum Summit 2015.
India wants to be Africa’s biggest trading partner and it has a captive audience to create a level-paying field and forge mutually beneficial and long-lasting business ties.
Forty African heads of state are in India for the summit — just one reason it is so important for India.
Another is the Chinese economic slowdown. China—India’s rival in Asia—presents an opportunity for India to prove itself as an alternative, a better investment destination and trade partner. Africa’s vast natural resources and status as the world’s fastest-growing population prompted the Narendra Modi government to challenge the dominance of China as Africa’s business ally.
India’s appeal for Africa has surged in the past year due to its higher economic growth trajectory and international standing earned by Modi. With China no longer flourishing, India looks more attractive to Africans who are trying to cope with a lull in mineral exports to China and growing concerns about China’s ability to keep investing in Africa.
However, though India has overtaken China in terms of the pace of economic growth, its economy is still one-fifth the size and it lacks the financial heft to challenge Beijing in a tough contest for the African market—while trade between India and Africa grew from $2 billion 15 years ago to $72 billion in 2014, trade between China and Africa stands at a mammoth $200 billion—more than the GDP of the 30 smallest African economies combined.
Therefore, while acknowledging that it may not be easy to take China on in the race to garner a larger pie of the growing African market, the Modi government wants to offer Africa a “choice” by aggressively promoting its “Make in India” campaign.
Also, as opposed to China’s exploitative approach wherein the world’s No. 2 economy has been sucking oil, coal and metals from Africa over the years to feed its industrial machine, India seeks a less transactional alliance and aims position itself as an ideal partner—leveraging Africa’s needs and India’s strengths—for overall development for the two regions that account for a third of the world’s people, but seven in 10 of those living in poverty.
As a massive gathering of leaders from a rising continent debate on possible trade options with the largest democracy in the world, the event has not only proved to be landmark in the history of relations among emerging powers, but also confirmed an elevated stature for India as a an emerging world leader.
The fact that India and Africa are emerging as decisive voices in the stage of world trade is effectively captured by the summit logo which features the African and Indian lions—the image points to the confidence and optimism that two landmasses that were once conjoined but now separated through geological drift are enjoying in their quest to realize their true potential. The imagery also encapsulates the courage and boldness of two emerging lions on the prowl for larger trade and bilateral opportunities.
The biggest gathering of foreign dignitaries in the country since 1983 with some 1,000 delegates, the India-Africa Forum Summit also envisages to transcend usual trade talks and address issues of common concerns such as climate change and international terrorism.
The meet gives Modi a chance to lead India to nullify its peers’ first-mover advantage and emerge Africa’s largest trade ally and in the process cement its growing status as one of the top global economic powerhouses.
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