D Dhanuraj, CPPR Chairman, comments on the news ‘How India can expand footprint in Global South by tapping Africa’s mega trade pact‘. The news was published in India Narrative on 2nd October, 2023.

Positioned itself as the voice of the Global South, India is now looking to play a more proactive role in Africa. It is set to press the pedal on carving a mechanism to tap the African Continental Free Trade Area (AfCFTA). The 55 member AfCFTA– the mega trade pushing intra-continental investment, is touted as one of the biggest trade deals in the world aimed at creating a single market with a combined GDP of about $3.4 trillion and serving as a gateway to 1.3 billion strong population and a ready market.

Indian investments in Africa are also increasing steadily. African countries would be keen to get support from India especially in areas related to food security, digitisation, health and clean energy. India is already a top destination for medical tourism for Africans.

“India, which is primarily dependent on imports of critical minerals and rare earth elements, must come up with a sharper Africa strategy in a time bound manner,” Dhanuraj D, chairman, Centre for Public Policy Research, told India Narrative.

A Brookings report said that lessons from the rollout and implementation of India’s biometric digital identification program—Aadhar—will be critical for African governments. If implemented effectively, digital identity can promote good governance by establishing clear institutional mandates and accountability mechanisms and more. India, already an established leader in this field can play an important role in bringing digital transformation in the continent.

Meanwhile, CNN in a report said that debt repayment issues amid global economic headwinds from the pandemic and the Ukraine war, “Beijing’s own bubbling financial woes and a need to better address environmental issues are among new pressures on how China lends and countries borrow.”

Though India with about $74 billion is among the top five investors in Africa, the figure is expected to go up with increased private sector participation. Last month the African Union was given membership to the G20 under India’s presidency.

While India and Africa have traditionally shared close ties driven by shared struggle against colonial rule and a large diaspora, with the admission of AU in the G20 frame under India’s chair has further boosted sentiments in favour of New Delhi.

According to official data, bilateral trade between India and Africa touched about $98 billion in 2022-23, an increase from a mere $7 billion in 2001.

Earlier in a research paper, the Observer Research Foundation said that it is critical for India to view Africa not just as a destination for short-term returns but as a partner for medium and long-term economic growth.

At a time when China has slowed its investments into the continent, India has an opportunity. The continent will also play an important role as the geopolitical thrust shifts towards the Indo Pacific.

Views expressed by the author are personal and need not reflect or represent the views of the Centre for Public Policy Research.

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