Indian industry is implementing a strategy to compete with China and European countries for capturing markets in growing African economies.
As part of the game plan, Commerce and Industry Minister Anand Sharma will be leaving for Nairobi tonight, leading a business delegation of the Federation of Indian Chambers of Commerce and Industry.
Senior officials from 187 Indian companies would be participating in the ‘Namaskar Africa’ and ‘India-East Africa Business Forum’ events at Nairobi, opening on October 14.
FICCI President and Bharti Enterprises Vice Chairman Rajan Bharati Mittal, with a strong interest in the telecom business in Africa, is the leading member of the delegation.
Sharma will be addressing a meeting of the India-Kenya Joint Trade Committee, according to a Commerce Ministry statement here.
He is also scheduled to meet Kenyan President Mwai Kibaki and Prime Minister Raila Odinga.
While India has bilateral trade of USD 30 billion (2009- 10) with Africa, business with East African nations, mainly Kenya, Rwanda, Seychelles, Ethiopia and Uganda, amounts to just USD 4 billion.
According to a FICCI study, “India has many commercial rivals in the region, particularly European countries like UK and China… The Chinese companies, which are government- owned, have far more capital for investment than the Indian private owned companies.”
The European countries may exercise pressure on the African nations to counter China and India, it said, adding, “This is harmful to India’s commercial and political relations with East African countries.”
India, on its part, is trying to counter the commercial threat from China and European nations by offering lines of credit to African firms. “That will help source capital goods from India,” FICCI Secretary General Amit Mitra said.
With a decade of growth at the rate of 5.4 per cent, the economic outlook for Africa is improving.
“For the first time in over three decades, a large number of African countries have begun to show sustained economic growth at the rates that are similar to the rest of the developing world and exceed that of most of the developed countries,” FICCI said.
Healthcare and pharmaceuticals, power, construction, information technology, roads and railways and minerals are the areas of opportunity for Indian companies, the study said.
This is to my knowledge the first explicit action plan by the Indian government about it’s strategy in Africa. India is asserting its interests vis-a-vis China in Africa especially since it has been playing catch up to Beijing. India’s challenge for global influence is prestige is indeed formidable as it has not yet achieved the economic and political profile that China enjoys regionally in Africa and globally. Yet at the same time, India lacks the contacts, knowledge of the complexities of various groups and segments of African society like European, American firms. But it gets increasingly bracketed with China as a rising power, emerging power or even a global superpower based off its current economic growth rates, which haven’t yet reached their apex. The difference between a goal and a dream is a plan. It’s about time that India laid out its plans how to approach Africa.