India in Africa: Another Giant Steps in — Prof. Romeo Orlandi, President of Osservatorio Asia SC

India is making good business in Africa. A few years ago it would have been unthinkable. The continent and the sub-continent seemed on the way to an unfortunate destiny. Now, they cooperate actively and their economy is consistently moving towards a promising future.
India is the 4th biggest trading partner of Africa, after Europe, China and the USA. Moreover, Delhi ranks number 3 in terms of investments in the continent, with interests in mining, agriculture, telecommunications and consumer goods. Trade between India and Africa is growing, mirroring different economic structures. India’s growth is second only to China’s in the world, while the 48 states of the sub-Saharan area are expected to reach an average growth of 6% in the current year.
India knows how to handle developing economies and is gradually taking a prominent role in Africa. Similarities with Africa abound: lack of infrastructures, command of the English language, high illiteracy rate and strong nationalism. A 3 million strong Indian diaspora in East Africa is an important asset to foster the relationship.
Many analysts judge India’s approach distinctive from China’s. Even if smaller, Indian’s attitude does not appear to cause any relevant criticism as yet. Rather than a suspected predatory approach, India is playing differently, using the concept of development through co-operation. Africa is not seen only as a supplier of natural resources, but as a partner with which to contribute to the production of prosperity.
Training of local staff is becoming common but so is the employment of in situ populations. A World Bank report declares that India is more participatory than China in this area. In addition, a growing number of private Indian corporations is competing against China’s SOEs (State Owned Enterprises) in many business transactions with Africa. It has been observed that negotiation powers are more balanced when state-funded entities are not involved.
Thus, African governments and companies are more relaxed and manage to negotiate more favourable conditions. With a new Africa, an unprecedented approach emerges in doing business with the different countries. It is a sign of maturity for a long-time neglected continent; it is also a challenge to encourage alternative approaches as well as a strong signal to China since competition is healthy for all players involved in the strife against poverty of such a magnificent land.