What is the issue?
- India-Africa trade and engagement is on a decline due to various factors.
- Policy implementation in this regard needs a critical review as Africa is considered a foreign policy priority by India.
How significant is Africa to India?
- India’s top five markets today in Africa are South Africa, Nigeria, Egypt, Kenya and Togo.
- The countries from which India imports the most are South Africa, Nigeria, Egypt, Angola and Guinea.
- India’s top three exports to Africa are:
- mineral fuels and oils (processed petroleum products)
- pharmaceutical products
- vehicles
- Mineral fuels and oils (essentially crude oil) and pearls, precious or semi-precious stones are the top two imports.
- The composition of the India-Africa trade has not changed much over the last two decades.
What is the current trade scenario?
- In 2020-21, India’s exports to Africa saw a reduction of 4.4% over the previous year.
- And imports saw a reduction of 25%.
- Thus, bilateral trade valued at $55.9 billion in 2020-21, fell by $10.8 billion compared to 2019-20.
- India’s investments in Africa too saw a decrease from $3.2 billion in 2019-20 to $2.9 billion in 2020-21.
- Total investments over 25 years, from April 1996 to March 2021, are now just $70.7 billion.
- This is about one-third of China’s investments in Africa.
What are the key reasons for the decline?