India–Africa trade is expected to touch $117 billion mark by 2020-21 as New Delhi increases its engagement with the continent in different ways, according to a study. A study, ‘RESHAPING INDIA-AFRICA TRADE — Dynamics and Export Potentiality of Indian Products in Africa’, unveiled by MoS (MEA) Gen VK Singh (retd) recently, has made an attempt to project the volume of exports to Africa, expected to touch $70 bn in 2021.
The study predicts the imports volume at $47 billion by 2021, taking the total trade between India-Africa to $117 billion. “Investments should not only focus on enhancing major infrastructural developments in Africa but also developing the basic amenities in Africa, as the trade environment is expected to grow on the back of strategic business prospects and plethora of investment opportunities,” recommends the study.
According to sources, “Africa is a region of interest to India and a lot of private sector companies are investing there. Besides the Least Developed Countries (LDCs) package that India offers to Africa, there are plenty of opportunities in the infra sector for the Indian companies to participate.”
India has already pledged a grant assistance of $600 million, which includes an India-Africa Development Fund of $100 million and an India-Africa Health Fund of $10 million. It will also include 50,000 scholarships in India over the next five years and support the expansion of the Pan Africa E-Network and institutions of skill, training and learning across Africa.
The aid and assistance provided by India in Africa mainly focuses on developing human resources through education, vocational training and skill development. It is a pro-people model that will help Africa up-skill its people to prepare for its impending demographic challenges. While the bulk of Indian investments in Africa are in the energy sector, efforts are on in inviting investments from the private sectors in sectors, including roads, ports, pharmaceuticals, diamonds, power generation and agriculture sectors to help create a model of ‘reverse dependence’. With China expected to make strategic investments to the tune of $750 billion, ‘besides creating skill building platform in those sectors where progress is expected, there is an urgent need to not only create capacity building for officials but also in the private sector’,urge experts.
According to ambassador Rajiv Bhatia, “Investors in the region have to be committed for developing capacity.” Highlighting the findings of study on done by PHD chambers of commerce and Industry, Gopal Jiwarajka, president, PHD Chambers said, “India has been able to intensify its presence in African countries through a significant line a credit worth $10 billion for development projects in Africa over a five-year period.”
According to the study, “With consistent expansion in trade, diversification and widening of products should also be focused on while trading with African nations in the coming years. The concentration of fewer Indian businesses in Africa is relatively high as around 600 Indian companies have invested in Africa but only 11 companies account for about 53% of the total Indian investment flows to Africa.”