From The Diplomat. Story by Daouda Cissé, research fellow at the China Institute, University of Alberta, Edmonton, Canada.

Compared to other major world economies, India is an emerging economy, but it is making inroads into Africa. Indian investment flow in Africa is significant, at $50 billion in 2014, although the vast majority of that goes to the tax haven Mauritius.

Still, Indian companies are active in a number of sectors in African economies, among them automobiles, services (mainly telecommunications and finance), pharmaceuticals, construction and resources.

Historically, India had an early presence in East Africa (particularly in Kenya, Tanzania and Uganda) and Southern Africa (South Africa, Mauritius, Madagascar and Seychelles); hence, there is an important African population of Indian descent in these countries.

While Indian investments are mostly concentrated in these countries due to the early historical ties and significant populations of Indian origin, more and more Indian companies are investing in West and North Africa.

Africans of Indian descent help foster Africa-India economic and cultural relations. Many are involved in private entrepreneurship and set up businesses between Africa and India in various economic sectors. They facilitate access to African markets for Indian companies.

While the European Union and the United States, for instance, enjoy robust economic relations with China, they worry when African countries seek the same.

In a globalizing world, African countries, like any other, are free to choose their partners. While many in Europe and the United States see China’s engagement in Africa as competition, each of Africa’s partners (traditional as well as emerging) pursue their own political, diplomatic and economic interests, and so do African countries.

As for India and China in Africa, in terms of investment and trade statistics, there is little competition. In 2014, China’s trade with Africa was at $200 billion, while trade between India and Africa was at $70 billion. As for investment, leaving aside the Mauritius tax haven, Chinese investment in Africa outweighs India’s.

While Africa’s partners are mainly driven by the need to secure resources and access markets for their industries, African countries should aim at maximizing the advantages they reap from these diverse partnerships and interests.

Governments should make sure that the investments boost growth and change economic structures, and that the revenues generated are reinvested in their countries and citizens. They must also ensure that areas where investments are made do not suffer environmental damage, that people’s livelihoods are not affected, and that African labor laws and workers’ rights are respected.

Read more at The Diplomat.