25 May, 2021
Historically, trade and business activities China and India with Africa dates long way back. The connection of India to the Southern and Eastern Africa emerged since the colonial epoque. The main events that built India’s modern-day political relations with Africa is during the stay of Mahatma Gandhi in South Africa between 1893 to1915 and subsequent immigration of Indians in Eastern Africa. They were the Britishers who brought large number of Indians to Eastern Africa mainly for the construction of Kenya-Uganda railway. On the other hand, China has been showing its extensive presence since the postcolonial era (Broadman G., 2007; Power, 1969). The modern-day Sino-African relations began with the establishment of diplomatic relations with Algeria, Egypt, Guinea, Somalia, Morocco, and Sudan in the late1950s (Fernando, 2007). Today, these two emerging economies of Asia are reshaping the prospects for African development. Their engagement has helped many African countries to get access to cheap and affordable consumer goods, benefits out of their investments in critical infrastructure projects and to unleash their productive potential (Cheru, 2016). In 2009, China became the single largest trading partner of Africa surpassing the US, Africa’s traditional economic partners and former colonial countries- France and UK among others. Over the last decade, China continues to maintain that coveted position. And since 2013, India has established itself as a second largest trading partner of Africa. These two countries have become the destination for more than 23.3% of total African exports in 2018 and it is anticipated to be more than 25% by 2025 (Akyeampong & Fofack, 2019; Alessi & Hanson, 2012; Ferdjani, 2012). However, it is not just the trade and investment cooperation that is happening between these economic giants. In this article, I aim to examine the Chinese and Indian engagements from a broad issue like their access to Africa’s vast market, development aid and cooperation, energy security and political and economic diplomacy. But most importantly, this article explores the aid, trade and investment cooperation between China, India, and Africa.
I begin the first section of this article by discussing the theoretical framework for understanding and exploring the aid, trade, and investment cooperation. This is premised on bringing together the critical juncture and insights into the paradigm of development cooperation. The second and third section presents an overview and assessment of the contending perspectives on the role of emerging southern powers- China and India in Africa, their interests and operation model. The fourth section investigates the main similarities and differences of their presence in Africa. In this section, I show more similarities and less differences of their interests and operation model in Africa. The final section concludes with the summary of this research.
The idea of development cooperation emerged after the end of second world war notably after the demise of the colonialism and the “civilizing missions” of the colonial powers. The conventional practice of development cooperation of the 1980s involves the promotion of interests of the donor countries with attached strings of conditionalities which would watch over the unsustainable loan-based debts. Over a period, it has developed into an institutionalized mode of international relations. Development cooperation in a large sense could be implicitly realized as a form of international cooperation intended to comply certain obligations and efforts. For instance, support the national self-determination of the newly independent developing countries, ensure the human rights and access to the benefits of international division of labour to their nationals, reduction of global inequalities by mitigating poverty among others (Siitonen, 1990, p.15-16). According to the Organization for Economic Cooperation and Development (OECD, 1985), Official Development Assistance (ODA) are administered with a view to promote the economic development and wellbeing of developing countries and it contains a grant element equal to at least 25% (Triulzi & Montalbano, 2001, p.4). Additionally, as a response to national budget deficits and the excessive burden of conditionalities, European Consensus on Development’ in 2005 emphasizes the quality of governance in developing countries that would affect the allocation of development fund as it is a crucial (co-) determinant of development outcomes (Hout, 2013). Apart from that, public narrative of the western aid and assistance is considered as unreciprocated charity (if not the reality) to be delivered to the less fortunate (Mawdsley, 2012).
Against such practices, narratives and assumptions, the emerging southern donors- China and India are considered as key actors in the global political economy who are rather interested on the strategic needs of the partner countries (Quadir, 2013). Nevertheless, this study will examine whether or not China and India are redefining the fabric of development cooperation in the new millennium. Mawdsley (2012) identifies four common features of South-South development cooperation: the constructed identity of a shared ‘developing country’ status, pertinent competence in development works, nonacceptance of hierarchical ‘donor-recipient’ relations; and an emphasis on mutual opportunities. However, in the contemporary world, the construct of geopolitical South is highly questionable. Despite that, the concept of cooperative efforts among peoples, institutions and governments that have been marked poor, developing and existing ‘The South’ is interesting area of study (Jules & Sá e Silva, 2008). Thereupon, this article is anchored in the theoretical framework of South-South Cooperation.
China’s Presence in Africa
Since the start of the new millennium, China has significantly accelerated itself as a superpower in the global trade pyramid indicating ‘soon to happen’ major shift in the global trading landscape. Thus, at first glance, presence of China in Africa must be understood in a framework of competing and exacerbated global energy politics, in which China along with India and US can be identified as key players extending their arms across the region for the security of supply. However, at second glance and adding to this popular discourse, China’s position in Africa is more extensive and has opened alternatives for the development of African countries for the first time since the neo-liberal world order of the 1980s (Mohan & Power, 2008). The establishment of Forum for China-Africa Cooperation (FOCAC) in 2000 is believed to be a remarkable event for the promotion and development of country to region economic and political affinity. Since then, Beijing started multiplying its embassies across Africa, started seeking more raw materials and oil resources, launched dozens of Confucius institutes with the intention to increase government sponsored programmes substantially coupled with vocational trainings and offering large number of scholarships to African students (Bodomo, 2019). In 2009 China appeared as Africa’s main trading partner and surpassed the World Bank as Africa’s principal lender (Akyeampong & Fofack, 2019).
Bodomo (2019) writes that, an essential feature of Chinese engagement with Africa can be seen by looking at Foreign Direct Investments (FDI) to Official Development Assistance (ODA) ratio. The trade to ODA figure entails that China is focusing on economic relations rather than development assistance in Africa. It is estimated that, over one-third of China’s oil supply comes from Africa, chiefly from Nigeria and Angola. Moreover, in agricultural domain, it imports 20% of its cotton needs from Burkina Faso, Benin and Mali, Cocoa from Côte d’Ivoire and coffee especially from Kenya. Contrastingly, Africa imports more diversified collection of low-cost industrial products and manufactured goods including electric appliances and machineries, vehicles and parts, mineral fuel and oil and consumer goods like garments and footwear (Akyeampong & Fofack, 2019; Martuscelli, 2020).
For some Africans, presence of China in the continent is contentious. Some African politicians are in favor of the Chinese presence in their country while others are not. Those in favor endorse the Chinese presence as an alternative which helps to break the conditional policy of the traditional western actors. This also meets the African interest for diversification in their partnership paradigm so that they can expand their room for negotiation at international level. On the other hand, those disapproving of the Chinese presence indicate that a new cycle of exploitation has begun which further fuels the dependency syndrome by undermining the capabilities of African entrepreneurs and civil societies. They argue that, there is not much of a big difference between the presence of western countries during the colonial era and Chinese presence in the neoliberal era- both are powerful actors in the global system of exploitation. Moreover, Kabamba (2015) argues that, Chinese immigrants in the form of workers and entrepreneurs have challenged the internal cohesion by creating frictions within the African communities. Henceforward, the presence of China in Africa can be characterized as being not entirely in ‘white’ or ‘black’ shade but as being in the ‘grey’ shade- having both encouraging and discouraging implications.
In its soft power paradigm, Haugen (2013) argues that, China has a long history of using educational aid as an instrument to strengthen its ties with Africa. The Chinese government seems to have prioritized scholarship programmes concerning African nationals. Since the turn of the millennium, there has been a growing influx of African students in different provinces of China (Ferdjani, 2012). Likewise, since the rise of Chinese president Xi Jinping, China is suggesting the notion of ‘smart power’. Smart power, as explained by Wilson III (2008) is the capacity of an actor to merge together the constituents of both hard power and soft power in such a such that they are mutually reinforcing and purposes of the actor gets advanced efficiently and effectively. With Africa comprising of 54 countries, it is the biggest voting bloc in the UN and other international institutions. The political and economic elements of ‘smart power’ under Xi’s regime is thought to have manifested in the African continent, for instance, in the UN Human Rights Commission, for international agreement towards the inception of Asian Infrastructure Investment Bank (AIIB), New Silk Road Project and countering anti-China motions introduced by some of the western international actors concerning the human rights and Tibet issue (Kim, 2017). Certainly, china’s economic rise is bound to have different geopolitical implications. In such scenarios, as discussed earlier, it will use different strategic instruments to better reflect its good image and interests in the rule-based international system.
Kabamba (2015) investigating into the China’s relationship with Democratic Republic of Congo (DRC) argues that, China has competitive advantage in Africa over its western counterparts due to their lesser engagements which has ensured limited competition over African untapped agricultural sector, energy and mineral resources and the rapid spread of Chinese construction enterprises into the African economies. Nevertheless, the relation between China and Africa should not be viewed only in terms of commercial consideration. It should also be viewed considering the political ramifications. Many African leaders cheer to Chinese model of development and see it as an alternative to the western model of economic development. Along with their fast track economic growth, Chinese supports with no strings attached- without political conditions and trappings is appealing to African regime. Since China made a significant development and economic rise in a short period of time, it is likely that African regime would want to learn from its development experiences. Moreover, African leaders perceive China’s backup as an alternative source for the stability of their regime. Chinese support comes without any political conditions. Therefore, African regimes who are accused of gross violations of human right standards, good governance and inefficient policies draining the economy and fueling the conflict have more chances that they would prefer the Chinese backup. For instance, countries like Zimbabwe, Sudan and Central African Republic are notably more relevant (Beri, 2007). Critics argue that, China’s aid in the form of export of credits and non-concessional state loans are believed to have played role in strengthening pariah regimes or fostering the pavement for Chinese companies to reach out to the African resources. In contrast, others point to the Chinese focus of mutual benefit and south-south cooperation and insist that China is an equal partner not a donor (Bräutigam, 2011).
However, at other instances, early ‘fascination with Chinese civilization’ among African establishment seems not entirely true. The President of Zambia, for instance, has objected concerning the working conditions in Chinese firms as not being civilized. Similarly, in Madagascar, Chinese entrepreneurs are accused of illegal exports of rosewood and zebu- generic to island. From Zambia to Mozambique, Chinese demands are said to have fueled poaching of wildlife. These instances suggest that arrival of Chinese entrepreneurs is not always a magic bullet for the development and prosperity. Alongside, the pact of factories and jobs, it has also brought environmental regression and friction with African communities. Likewise, for the weak African economies, big investments without transfer of technology and know-how, large chunk of cheap imports could turn out calamitous (Feng & Pilling, 2019; Joshi, 2017). While China is assuring the security of supply of raw materials from the resource rich countries of Africa, it is also certainly seeking its market in the vast African continent. In such scenario, African economies would be better off only if they exercise calculative engagements with China. Otherwise, it looks, it will always be a ‘win-lose’ partnerships where China always wins, and Africa always lose.
India’s Presence in Africa
In modern history, the foundation of ties between India and Africa is based on the historical independence movement, waves of decolonization in the past century and the idea of south-south cooperation. Over the years, the relation has been strengthened in political, social, cultural and economic front (Dubey & Biswas, 2016; Malancha, 2016). To strengthen its position in Africa, India is aware of effective development cooperation policy which is primarily manifested through the institutionalization mechanism- conducting cyclical summits and signing different economic, investment and aid agreements. Development cooperation strategy includes setting up India-Africa’s fund to support Africa’s development programme and low interest concessional loans to improve infrastructures. Since the India-Africa Forum Summit (IAF) conducted in 2008, African LDCs get benefit from India’s Duty-Free tariff preference. Moreover, thousands of African experts each year participate in public administration, accounting and other technical trainings as a part of India’s special commonwealth African Assistance programme (Joshi, 2017; Malancha, 2016).
India’s development assistance programme are driven by various factors including but not limited to increasing and sustaining its own economic growth through trade and inducing employment & income for reducing domestic poverty. Additionally, it wants to develop its strategic interests through substantial business and economic presence, secure domestic energy security and advance its role in the international governance system (Gu et al., 2016). As discussed earlier, it’s engagement with Africa stems out of their related historical linkages but with course of time, it has been boosted by political and economic interests. As India’s interest expands beyond the extractive industrial sectors, it is indicating more sustainable engagement in the continent. For instance, its rapidly increasing technological, agricultural and pharmaceutical companies claim not just to make profit but also contribute to the development of Africa (Dubey & Biswas, 2016). Moreover, it is claiming to maintain non-discriminatory approach by transferring technologies, creating employment, and posing minimum threat to local producers. In addition, the engagement of India-Africa trade is also manifested in the form of government aid and tax reforms (Broadman, 2007; Dubey & Biswas, 2016).
When it comes to India’s bilateral aid programmes, they are operationalized through multilateral approach where Indian government supports and cooperates with various African institutions, for instance, African Union (AU) and The New Partnership for Africa’s Development (NEPAD) among others. With this approach, on the one hand, India’s trade with African continent is expected to multiply through its participation in regional projects adopted by NEPAD and other regional institutions of Africa (Naidu et al., 2010). On the other hand, it allows India to influence (or improve relations) with regional powers in one single platform. Likewise, it eases the bargaining power in international governance system, attempts to find a common ground, reduces the cost borne by meeting multiple stakeholders and eventually promotes “Regional Multilateralism” in the process.
India’s extension of development assistance to Africa clearly indicates its shift away from its conventional focus on neighboring countries. With the dynamics of international relations, politics, and global equations, current development assistance modality of India includes combination of technical assistance, grants for projects and trade- for instance, Lines of credit (LOCs) for the trade and concessional loans (Gu et al., 2016). The Ministry of External Affairs (MEA) of India allocates aid and assistance volume to its cooperating partners based on economic and political considerations. Not all African countries are considered with same degree of keenness. The aid and assistance volume are allocated according to the strategic or conceived importance of the recipient country. For instance, African countries like Mauritius, Uganda and South Africa with large number of Indian diaspora and economic importance entertain large volume of aid and assistance while the countries with negligible Indian diaspora and no economic weight entertain only a tiny fraction of it (Kragelund, 2010). This practice clearly reveals India’s strategic priority to African countries where there is presence of large number of Indian diasporas. It is because Indian diaspora in Africa are non-state actors, but they can significantly influence their host state, their homeland and country of origin. They share two culture, maintain social & political linkages in two societies and emotional attachment with at least two nations. Therefore, they can develop strong government-to-government and private sector ties in two or more than two nations.
The preference for countries with an Indian diaspora is also evident in the case of Investments made by Indian multinational conglomerates. For instance, the oldest Indian Industrial group- Tata group is most active in South Africa pioneering in car distribution, IT services, telecoms, bus-body building and various others. Other firms and Indian conglomerates are also actively operating in Eastern Africa where existing Indian diaspora are acting as strong foundations and easy access of their entry and operations (Dubey & Biswas, 2016; Goldstein et al., 2006).
Looking at the scenario, it is problematic to assume that India in Africa is only focused on African resources and extractive industries in unidirectional fashion. There are several Indian private sectors increasing their footprint in diversified areas, for instance, pharmaceuticals, agribusiness and telecommunications. Moreover, providing access to low cost technology, supporting African energy security by providing access to clean energy to the lower strata of population, supporting to Africa’s food security, provision of scholarships to African students and supporting the institutions in Africa is a part of India’s development cooperation (Malancha, 2016). India is obviously taking benefits out of African resources. In return, it also seems to give a lot and has been able to establish itself as one of the major players in African development assistance.
Similarities and Differences of Their Presence
The engagement of both China and India in Africa seems to be ‘economic’ as well as ‘geopolitical’ in nature. In the case of economy, both want to secure their ‘resource need’ by fostering close trade deals and investments in Africa. In the case of geopolitics, both want to establish themselves as a global actor similar to western countries (Barma & Ratner, 2006; Martuscelli, 2020; Tull, 2006). Notwithstanding this, the import and export sectors between Africa and China-India suggest that, a symbiotic relationship has been established between Africa and China-India. Essentially, the former exports raw materials which helps to boost the industurial and manufacturing goods in the latter. And the latter exports finished goods to the former. This symbiotic relationship is criticised by traditional development agencies and international monitors telling that, this is just a neocolonial makeover and is not very distinct from Africa’s historical engagements with European nations during the colonial era (Akyeampong & Fofack, 2019).
It is true that, the main concern of both China and India is the quest for energy security. Therefore, they have initiated ‘oil for infrastructure’ projects in several parts of Africa. Indian oil companies are on the same scale as Chinese oil companies operating in African states like Angola, Nigeria, Gabon, Sudan, and Libya among others. In return, the oil extracting regimes are helping to construct oil refineries, power plants, railway links and port infrastructures in the African continent (Naidu et al., 2010). The visibility of Chinese and Indian investments across Africa, their infrastructure investment from the construction of dams to the escalation of telecommunication sectors has helped raise national productivity and reduce poverty in the continent. Both countries are addressing critical infrastructure cheaply, with less bureaucratic hassle and in shorter time. Moreover, Africa on the other hand is feeding the appetite of resources of the two big economies (Cheru & Obi, 2011).
However, looking at the other side of the story, Tull (2006) argues that, China’s ecomomic engagement with Africa may entail a mixed blessing, whereas the political involvement may lead to detrimental conditions. Its support for (or indifference to) authoritarian regimes in Africa at the expense of democracy and respect for human rights are bound to prove harmful. Likewise, Malancha (2016) argues that, India’s expansion is equally harmful concerning development engagement and technical cooperation with Africa in recent years. Though its assistance model is more demand driven and aims to address the requests and priorities of African partners, these offers are not conditional on political requirements. Since China also maintains “no strings attached” prototype in its assistance, both China and India seem to be indifferent about the internal politics of the region.
Bräutigam (2003) highlights the role of Chinese diaspora in creating the business networks for promoting transnational capitalism. These networks act as a catalyst who are rich in local knowledge and are useful members in understanding the local capital, finance, technical knowledge, policy information, industrial dynamism, and marketing information. For instance, in Nigeria, the environment is relatively hostile with negligible or no presence of Chinese diaspora. Consequently, business activities are limited. Contrastingly, in Mauritius, there is a sizable presence of Chinese who eventually have created successful export-oriented industrialization. In similar vein, Malancha (2016) and Dubey (2016)highlight the role of Indian diaspora across the Africa who are ‘important resource and facilitator’ bridging communication gaps and furthering economic relations.
Cheru and Obi (2011) argue that, both China and India are eager to ensure and promote their engagement and cooperation with their African partners. This would support them to increase their global footprint, interests, and relationships. Both countries as well as Africa are responding to the challenges and possibilities of establishing themselves in a highly competitive world of globalization and interdependence. In such a scenario, differences between Chinese and Indian engagement with Africa is more form than intent. Popularly, China is often regarded as a pioneer for infrastructure development in Africa. Certainly, Chinese are creating and multiplying mass urban and cross-country infrastructures. Nevertheless, some analysts argue that, Indian involvement in the areas of terrestrial, cable and satellite television, broadband networks and mobile and telecommunications are more important for Africa’s development in the long term. Additionally, Indian service sector companies and conglomerates are prioritizing the production, manufacturing, distribution and creating jobs in Africa (Dubey & Biswas, 2016). It eventually makes Indian investments more popular as many Africans see it has a terrace for employment opportunities in Africa.
In the current of economic globalization, Cheru and Obi (2010) argue that, China and India has been able to establish themselves as alternative development partners for Africa surpassing western countries in terms of size of investments and importance to economies. For Africa, there could be potentials of instructive lessons from these two emerging economies of Asia to get out from the shackles of poverty, underdevelopment, and aid dependency. Among the African policy makers and some scholars, their impressive development experience since the mid-1970s (China) and early 1990s (India) could enable numerous experiences sharing stages for ‘policy space’ and economic growth of the continent. Moreover, African countries have alternative strategic choice of diversifying their engagement with these emerging development partners in the world stage. However, in their volume, they also indicate that, presence of alternative actors in the continent is not just enough. African countries should capitalize their engagement from a stronger and more informed platform. Otherwise, in the absence of deliberate and proactive action, their presence could just turn into ‘neocolonialism by invitation’. China is a big investor in Africa followed by India. Given their size of investment, it is also important for Africa that it gets to enjoy the transfer of technology, knowledge, and scientific know-how from both China and India. Apart from that, it is crucial for African countries to maintain trade balance with two Asian giants. In the absence of these, Africa could fall into the risk of trade deficit, resource outsourcing and debt trap.
To sum up, both Chinese and Indian presence in Africa is modelled into government to government collaboration, private investments, and close collaboration with diaspora. However, in their distinction, it looks China is more state driven (carries state heavy approach) while launching their projects in Africa prioritizing resource extraction, hard infrastructure development and upper crust wealth creation. On the flip side, India operates through bilateral collaboration through multilateralism, driven more by private sector and Indian multinational conglomerates. It seems to focus on soft infrastructures and service sectors delivering services in Africa. Nevertheless, India also seems to emulate Chinese model, but it has not reached to its true potential.
The growing footprint of China and India in Africa is reshaping and revolutionizing the continent’s international relations mainly thorough the combination of aid, trade, and investment. Their engagements have helped in getting easy access to cheap and affordable consumer goods, growth, and development through their investments in critical infrastructure projects and support to unleash African productive potential. Notwithstanding this, the very nature of their engagement seems to be ‘economic’ as well as ‘geopolitical’. In the former, they secure resource need for their country and in the latter, they are establishing themselves as a global actor. In the process, today, China has become the largest and India the second largest partner for African development assistance. Their presence must be understood in a framework of competing and collaborating global energy politics for the security of supply. Alongside this, their presence has also opened alternatives for development of African countries for the first time since the neo-liberal world order of the 1980s by transforming their relationship in the form of South-South Cooperation. The distinctive element of Chinese and Indian offerings in Africa is that, they are not conditional in terms of political requirements, “no string attached”. However, their help and offerings have propensity to directly or indirectly influence the African countries which perhaps have solidified the African vote bloc to favor China and India in the global forum like UN among others.
Both China and India have recognized the presence of their diaspora in Africa as important resources and facilitators. Consequently, they have given assistance and investment priority to the African countries having sizable presence of their diaspora. That being said, some scholars arguing that, Chinese friction with African communities, entrepreneurs and civil societies due to emerging new cycle of exploitation also holds true. However, in my study, there were no substantial report of Indian friction with African communities in recent history. This could be because Indian investments and their footprints is not as much as China’s. Why is the presence of China in Africa carries more likely thereat than the presence of India? Well, this could be further researched. However, for Africans, diversification in their partnership paradigm shifting away from traditional western partners can expand their room for negotiation at international level.
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