Africa: India Woos Continent With U.S.$5 Billion Loan Offer

Business Daily (Nairobi)

Argaw Ashine And Lee Mwiti

26 May 2011

India offered Africa $5 billion over three years as the headline item of a key bilateral summit as the Asian giant sought to widen its economic footprint on the continent.

The money, to be disbursed as lines of credit, is in addition to the $5.4 billion that it had offered at the first India-Africa summit in New Delhi in 2008.

At the second of what has now become a triennial summit between the two regions, India will also put up an additional $700 million to build new training institutions on the continent including a raft of new pan-African institutions.

Indian prime minister Manmohan Singh said that following a request by the African Union, India would also support a new Ethio-Djibouti railway at a cost of $300 million as New Delhi dangled new trinkets at Africa. The African Union mission in Somalia would also benefit from the largesse with a pledge of $2 million while African airlines will get increased access to Indian cities in what Mr Singh said was a unique partnership between the two regions.

Historic opportunity

“Today the people of Africa and India stand at the threshold of a historic opportunity,” Mr Singh told the 10 heads of state and two deputy heads of state at the AU headquarters in Addis Ababa.

“Your presence shows that we are on the right path in building an enduring relationship,” he said. Some 17 African states were represented, including all the Regional Economic Communities. The India premier said the two regions had reason to be satisfied with what had been achieved since the first summit in 2008.

There had been concerns that the pledges and concessions offered then have taken longer-than-envisaged to transform into projects on the ground. Mr Singh said that Africa’s economic progress placed it in good stead to become a major growth pole of the world this century, with six of the world’s largest emerging economies being in sub-Saharan Africa. “We will work with Africa to enable it realise this potential,” he said.

Towards this India will also establish an India-Africa virtual university following what the premier said was the success of the pan-African e-Network project, in addition to offering 10,000 new scholarships under the new institution.

Diverse areas

The pan-African institutions are in diverse areas such as food processing, textiles, sciences and weather forecasting.

India will also increase the number of graduate scholarships it offers from to 900, up from 500, with some 22,000 scholarships to be offered to African students through various initiatives over the next three years.

Mr Singh called for the establishment of an India-Africa Business Council that would bring together chief executives of firms from both sides.

AU commission chief Jean Ping welcomed India as an ally, adding that the relationship between the two regions was now a progressive one.”We should do more so at achieve even better gains,” he said.

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