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10 February 2022, Gateway House

India-Africa Relations: Changing Horizons

Nearly two decades since the launch of the India Development Initiative, India-Africa relations have evolved. This book by Rajiv Bhatia, a former high-ranking IFS officer, takes a deep dive into Indo-African engagement. Bhatia outlines the history and presents concise yet informative capsules of India's relationship with individual African countries. It is a useful roadmap for companies looking to do business there.

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It is close to two decades now since the launch of the India Development Initiative by the Vajpayee government, time enough for a close look at how India-Africa relations have evolved. This book by Rajiv Bhatia, a former high-ranking IFS officer, is an invaluable endeavour towards this end.

In many ways, it is apt that this book focuses on Africa and India, continent and sub-continent though they may be. Much has long been made of the fact that the GDP and population of the African continent more or less correspond with those of the Indian sub-continent. The relationship is far deeper, however, as Bhatia well brings out. The searing experiences of colonialism, specifically the economic rapacity and political repression of the colonialists, left both Africa and India scarred. From near the top of the global table (India was one of the two largest economies in the world prior to the advent of the British), both regions found themselves denuded of their wealth and embroiled in a miasma of social and political problems. The diversity of the Indian sub-continent in terms of language, dress, cuisine and customs is to a reasonable extent mirrored in the African continent as a whole. Critically, India and Africa accounted for 34% of the world’s population in 2019, and by 2050, that share is projected to touch 42%, by when Africa will have the youngest population of the world, energetic, optimistic and demanding quality goods and services from the world.

This is not to suggest, as Bhatia rightly points out, that Africa is a single monolith; this is a common mistake made by many distant observers and laymen. Rather Africa is an agglomeration of 54 countries, which no matter their common challenges, also feature material variations in their stage of development, resource endowments, institutions and politics. While much is made of the laggard African countries beset with problems, let us also recall that some of the fastest-growing economies in the world are African.

Why is Africa so important to India and to the world? Bhatia makes this point early on. Science has long since established that humans originated in Africa and then migrated across the globe. It is a delicious irony, therefore, that with the other continents having reached stable or declining populations, Africa with its young population, low population density, vast landmass and rich resource endowments is not just the past but also the future of mankind. Over the next couple of decades, Africa and Africans will forge ahead, while much of the rest of the world stays put, or even shifts into reverse gear. The rest of the world will therefore be critically dependent on Africa and Africans, first as customers for investment, goods and services, and in due course as sources and suppliers of the same.

While Bhatia explicitly states that this is not a history book, the book does give an excellent overview of the effect of colonialism and how various African countries have evolved post-colonialism. The paths have rarely been smooth or straight, and the book deftly identifies key developments without getting bogged down in minutiae. As a result, the reader gets a neatly encapsulated condensed history of the region, en passant as it were.

A key part of the book is the searching look that Bhatia gives to the post-colonial outreach initiatives of various countries like the U.S., Japan, the UAE, South Korea, Brazil, Russia, Australia and Turkey. The elephant in the room, of course, is China, and Bhatia devotes an entire chapter to examining the extent and impact of China’s outreach to Africa. His assessment of the Chinese is spot on. There has been much made of Chinese exploitation of African resources, its disregard for local preferences, gold-plating of development projects, and most of all, the clear threat to the national sovereignty of African countries by China’s right to seize or preferentially exploit natural resources or infrastructure like ports and railways. Notwithstanding Chinese denials of such predatory tactics, there is certainly more than a degree of truth to these accusations. There are well-founded accusations that Chinese development projects tend to be for the benefit of the borrowing country’s rulers rather than the country itself, and these cannot be wished away lightly. Bhatia pulls no punches in his analysis, even as he points out that a balanced look at costs and benefits is needed. It is certainly a delicious irony, however, to see the indignant protests of the erstwhile colonial powers, who in their time did far worse. Even at its most egregious, the Chinese tactics pale when juxtaposed with the brutality and theft of the colonialists.

The core of the book is the most fascinating, and that is Bhatia’s deep dive into Indo-African engagement. He sketches out the historical beginnings of pre-independence contacts and the role (warts and all), of Gandhi and Nehru in the African freedom struggles. He then provides a wealth of data on Indian outreach to Africa, by way of political support, technical assistance in training and education, and of course, the headline-grabbing financial assistance by way of the GOI Lines of Credit channelled through the Exim Bank of India. Bhatia’s foreign service training is very much in evidence here as he presents a tour d’horizon of the various political and diplomatic initiatives between India and Africa. He also presents concise yet informative capsules of individual African countries and the features of India’s relationship with each of them; very useful for corporates looking to do business there.

This brings me to the only wish-list I would have for this excellent book. One would have found this book even more useful with some commercial analysis and pointers to Indian companies looking to do business in Africa. This is not to point fingers at Bhatia; India Inc. has been timid and somewhat myopic in their attempts to do business in Africa, following timorously where the government has sought to lead. Indian corporates do certainly have some legitimate grouses in the lack of competitive risk mitigation by way of political risk cover and of limited recourse/non-recourse project finance, as well as the long-standing complaint about the higher cost of finance from Indian institutions as compared to Chinese support to Chinese exporters. That is not however the whole story and India Inc. needs to step up to the plate. Perhaps a follow-up to this tome could cover these.

David Rasquinha is former Managing Director, Exim Bank India.

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