India Studies in Business and Economics

India Studies in Business and Economics

The Indian economy is considered to be one of the fastest growing economies of the world with India amongst the most important G-20 economies. Ever since the Indian economy made its presence felt on the global platform, the research community is now even more interested in studying and analyzing what India has to offer. This series aims to bring forth the latest studies and research about India from the areas of economics, business, and management science. The titles featured in this series will present rigorous empirical research, often accompanied by policy recommendations, evoke and evaluate various aspects of the economy and the business and management landscape in India, with a special focus on India s relationship with the world in terms of business and trade. More information about this series at http://www.springer.com/series/11234

Ajay Kumar Dubey Aparajita Biswas Editors India and Africa s Partnership A Vision for a New Future 123

Editors Ajay Kumar Dubey UGC Centre for African Studies, School of International Studies Jawaharlal Nehru University (JNU) New Delhi India Aparajita Biswas Centre for African Studies (CAS) University of Mumbai Mumbai India ISSN 2198-0012 ISSN 2198-0020 (electronic) India Studies in Business and Economics ISBN 978-81-322-2618-5 ISBN 978-81-322-2619-2 (ebook) DOI 10.1007/978-81-322-2619-2 Library of Congress Control Number: 2015947413 Springer New Delhi Heidelberg New York Dordrecht London African Studies Association of India 2016 This work is subject to copyright. All rights are reserved by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, express or implied, with respect to the material contained herein or for any errors or omissions that may have been made. Printed on acid-free paper Springer (India) Pvt. Ltd. is part of Springer Science+Business Media (www.springer.com)

Foreword India and Africa have been long-term allies in the drive for African independence in the middle of the past century. India s Africa policy emphasized decolonization and the achievement of African majority rule. Both opposed all forms of domination, particularly racial domination, in any part of Africa or Asia. The relationship has consolidated over the years not only in the political arena, but also in the social, cultural and economic relations. Looking to intensify the economic relations, the government of India initiated the Focus Africa Programme, extended soft loan facilities through its Exim Bank and introduced debt-relief measures for African countries. The Confederation of Indian Industries and the Federation of Indian Chambers of Commerce and Industries organized conclaves, conferences and programmes to increase India s economic footprint across Africa. As a result of these efforts, India-Africa trade reached US$68 billion in 2014 and is projected to surpass US$75 billion in 2015. Yet the trade potential between the two regions is far greater, and its spread and composition can substantially diversify. India has also extended a duty-free tariff preferential scheme to the 34 least developed countries in Africa, which covers more than 90% of India s tariff lines and provides preferential market access for the exports of all least developed countries. Indian investment in Africa now covers much of the continent, in different sectors, ranging from mining, telecommunications and information technology-enabled services to apparel, retail ventures, fisheries and food processing. Indian conglomerates have profitable projects in Africa and the total investment of Indian companies in Africa is estimated at more than US$32 billion. In the other direction, African multinationals, particularly from South Africa, have ventured into India over the past decade, with a growing presence in infrastructure, breweries and financial services. India and Africa have also been engaging on trade policy, with close coordination and synchronization on agricultural subsidy and pricing issues in the Doha Round of trade negotiations in the World Trade Organization (WTO), to ensure that the Doha Round is truly a Development Round. v

vi Foreword I also welcome the growing cooperation via Africa s continental Institutions, the African Union and the African Development Bank. A substantial amount of the funds committed for capacity building in Africa are being channelled through the African Union in a Joint Action Plan involving shared decision making for allocation of resources. This co-equal multilateralism is an important feature of India s new model of engagement with Africa. The achievements in economic cooperation in recent years have been considerable. A major landmark has been the India-Africa Forum summits, organized first in 2008 and again in 2011, which place development cooperation in a much broader context of overall relations between India and African countries. Development is seen not merely in economic terms but as a process that is sustainable only if located within a larger political, social and intellectual environment. The third India-Africa Forum summit is scheduled to be held in New Delhi later this year in October. I look forward to the Forum, which will provide yet another great opportunity for realizing the potential for enhancing the cooperation between Africa and the Indian subcontinent.

Acknowledgment This book is the result of a research project, which was financially supported by the African Development Bank (AfDB). The findings and opinions expressed in this publication do not necessarily reflect those of the AfDB and African Studies Association (ASA) India. vii

Contents 1 Introduction: A Long-Standing Relationship... 1 Ajay Kumar Dubey and Aparajita Biswas 2 India Africa Relations: Historical Goodwill and a Vision for the Future... 11 Ajay Kumar Dubey 3 Indian Investors Seeking Markets and Business Prospects... 41 Aparajita Biswas 4 India s Pursuit of Investment Opportunities in Africa... 61 Chris Alden and Raj Verma 5 The Importance of Africa in India s Energy Security... 83 Aparajita Biswas 6 India s Economic Diplomacy in Africa... 99 Ian Taylor 7 The Indian Diaspora as a Heritage Resource in Indo African Relations... 115 Ajay Kumar Dubey 8 Conclusion... 137 Ajay Kumar Dubey and Aparajita Biswas Appendix A: First Africa India Forum Summit 2008, New Delhi.... 147 Appendix B: Second Africa India Forum Summit 2011, Addis Ababa... 169 ix

x Contents Appendix C: Lines of Credit to Africa... 183 Selected Bibliography... 199 Index... 227

Abbreviations and Acronyms ACBF AU BRIC COMESA CRISIL CSO E&P EAC ECOWAS FDI FICCI HIPC IBSA ICAR ICT IGAD IOCL ITEC JDZ LDC LOC LNG MEA MT NAM NEPAD NOC OAU/AU OEDC-DAC OIL Africa Capacity Building Foundation African Union Brazil, Russia, China and India Common Market for Eastern and Southern Africa Credit Rating and Information Services of India Ltd. Civil Society Organization Exploration and Production East African Community Economic Community of West African States Foreign Direct Investment Federation of Indian Chambers of Commerce and Industry Heavily Indebted Poor Countries (initiative) India Brazil South Africa Dialogue Forum Indian Council of Agricultural Research Information and communication technology Intergovernmental Authority on Development Indian Oil Corporation Ltd. Indian Technical and Economic Cooperation Programme Joint Development Zone (Nigeria São Tomé and Príncipe) Least Developed Countries Line Of Credit Liquefied Natural Gas Ministry of External Affairs Metric Ton Non-Aligned Movement New Partnership for Africa s Development National Oil Company Organization of African Unity/African Union Organisation for Economic Co-operation and Development-Development Assistance Committee Oil India Ltd. xi

xii ONGC OVL PIO PPP PTA REC RIL SACU SADC SCAAP SOE TCIL UMA UNDP VoIP Abbreviations and Acronyms Oil and Natural Gas Corporation Ltd. ONGC Videsh Ltd. Person of Indian Origin Public Private Partnership Preferential Trade Agreement Regional Economic Community Reliance Industries Limited South African Customs Union Southern African Development Community Special Commonwealth Assistance for Africa Programme State-Owned Enterprise Telecommunications Consultants India Ltd. Arab Maghreb Union United Nations Development Programme Voice over Internet Protocol

Editors and Contributors About the Editors Ajay Kumar Dubey is director of the UGC Centre for African Studies, School of International Studies, Jawaharlal Nehru University (JNU), New Delhi. He has more than two decades of post-graduate teaching and research experience. He has about nine published books to his credit along with several dozen research papers published in research journals of international repute. He is the editor-in-chief of three international research journals, Africa Review and Diaspora Studies (by Routledge, London) and Insight on Africa (by Sage Publications). He is currently the Secretary General of African Studies Association of India (ASA India), and President of Organization for Diaspora Initiatives (ODI International). His areas of interest include international relations, African affairs, diaspora studies, Indian migration, Indo-African relations, development issues and political science. Aparajita Biswas is professor and former director of Centre for African Studies, University of Mumbai. She obtained her Ph.D. in African studies from the same centre. She is currently the president of ASA India and editor of the journal Africa Review. She is associated with various universities, research institutes and research groups in India and abroad and has published books and several research articles in national and international journals. Her areas of interest include African studies, international relations, India-Africa relations, Indian Ocean region, South and Southern Africa, energy security issues. Contributors Chris Alden International Relations, The London School of Economics and Political Science, London, UK Aparajita Biswas Centre for African Studies (CAS), University of Mumbai, Mumbai, India xiii

xiv Editors and Contributors Ajay Kumar Dubey School of International Studies, UGC Centre for African Studies, Jawaharlal Nehru University (JNU), New Delhi, India Ian Taylor Professor in International Relations and African Politics, University of St. Andrews, St. Andrews, UK Raj Verma International Relations, The London School of Economics and Political Science, London, UK