The 3rd Indo-Africa Summit was attended by over 55 African participating nations and was viewed as one of Indian Prime Minister’s most successful diplomatic overtures to Africa.
African economy made a dramatic turnaround from a negative growth during 80s and 90s to an upward growth till 2011, where the average annual real GDP growth hovered on 4-5 % during these periods. Its nominal GDP rose to US $ 1.97 trillion in 2011, reflecting the strong domestic demand in Africa.
India was a late runner for African entry and it was Mr. Modi’s effort to bring Africa closer to India through the Summit. Powered by domestic demand, Africa is deemed as a potential destination for India’s export, spurring over 60 % over a period of five years to 2015.
Africa’s share in India’s total exports increased from 7.9 % in 2010-11 to 10.6 % in 2014-15. Additionally, South Africa, Kenya, Egypt, Tanzania and Nigeria are the key drivers to boost exports from India to Africa.
Africa is projected as the next attractive destination for investment. According to Ernst and Young; Africa moved from eighth position to the second most attractive destination in the world in 2014. FDI in Africa increased by 64% in 2014 according to FDI intelligence, whereby France, Greece, USA, China and Belgium were the top five foreign investors.
Given the spurring growth in investment opportunities, India stands for a good opportunity to invest in Africa, where previously, Indian investment stood at US $ 30 billion, mainly in telecommunications, hydrocarbons, IT, water treatment, drugs and pharmaceuticals. In addition, India may utilise Japanese tech-power and human relations to make a foray in Africa’s emerging investment opportunities.
Source: The Echo of India
Date: 03 November 2015