Business, Economics and Jobs

India plays catch-up with China in Africa


India Prime Minister Manmohan Singh is in Africa to kick off the second India-Africa Summit being held in Addis Ababa, Ethiopia, hoping to drum up more trade with the continent for his country.


Prakash Singh

China usually steals the headlines when it comes to big ticket investments in Africa with its multibillion dollar deals swapping resources for infrastructure, but India - the world's other emergeing superpower - is also trawling the continent for the raw materials it needs to fuel its economy, as a visit this week by Prime Minister Manmohan Singh makes clear.

Singh is in Addis Ababa for the start of the second India-Africa summit and a six-day visit to Ethiopia and Tanzania hoping to offer development aid and credit in exchange for more trade and political support.

India is trailing China: India’s trade with Africa is worth around $40 billion a year, China’s is worth roughly three times that.

India is keen to export its pharmaceuticals, technology and industrial hardware and to import African copper, cobalt, diamonds, gold and oil. But China’s financial muscle means it can simply outbid India when the two go head-to-head.

Both Asian powers – like the US and others – are eager for a share of African oil to secure and diversify their energy supplies. A 2009 report by the London-based think tank Chatham House on Asian involvement in the Nigerian and Angolan oil industries points out that, “China’s deeper pockets have certainly put a break on India’s ambitions.”

In other ways India is taking tips from China’s Africa playbook. Mao Zedong supported Africa’s socialist liberation movements in the 1960s and in return African states voted China onto the United Nations Security Council in 1971.

India is eager for a similar quid pro quo when it comes to its rivalry with Pakistan and its own bid for a place on the Security Council.