Indo-African bilateral trade will touch $100 billion by 2018: AfDB
- China is said to mull cutting car import duty by about half
- Draft National Telecom Policy to be released on 1 May
- Was the boost in digital payments after demonetization temporary?
- Deals Buzz: SoftBank to move ride-hailing stakes worth $20 bn to Vision Fund, says report
- Gold is little changed near five-week low as higher dollar, bond yields weigh
Ahmedabad: The bilateral trade between India and Africa is expected to touch $100 billion by 2018, according to said Akinwumi A. Adesina, president, African Development Bank (AfDB).
He was speaking at a press conference in Ahmedabad ahead of the five-day annual meeting of the bank which is scheduled to be held at Mahatma Mandir Convention Centre in Gandhinagar from Monday.
This is the first time that the annual meetings of AfDB are being held in India. Prime Minister Narendra Modi will be participating in the inaugural session. Finance minister Arun Jaitley will chair the meeting of board of governors.
The annual meetings are the bank’s largest annual event and serve to raise the profile of the institution on the global stage, according to a media release by the foreign ministry. In addition to the annual meeting of the board of governors, these meetings will bring together about 3,000 delegates and participants, and will feature a number of official and side events, it said.
“The bilateral trade between India and Africa was $11.7 billion in 2005-06 and this has reached $56.9 billion by 2015-16. Now we expect the bilateral trade to exceed $100 billion in the next two years,” Adesina said, while lauding Modi for his efforts to strengthen the Indo-African relationship.
At the India-Africa Forum Summit 2015, Modi announced a $10 billion line of credit that marked a new approach to engagement with African countries. This not only helped finance the projects in African countries but have also contributed to capacity-building and education.
India is the fifth-biggest investor in Africa, with investments over the past 20 years amounting to $54 billion or 19.2% of Africa’s foreign direct investment. Pharmaceuticals, ICT and services, the automobile sector and the power sector are likely to be major contributors to the bilateral trade between the two countries in the next two years, Adesina said.
AfDB has adopted a strategy called “High 5s” that focuses on five major social developmental initiatives including energy, industrialization, regional connectivity, agriculture and improved quality of life. The Indian government has also organized an “India-Africa Dialogue” in partnership with the Confederation of Indian Industries (CII), where the sessions will broadly inform Indian companies about the bank’s “High 5s” agenda.
On the sidelines of the annual meeting, an event pertaining to the International Solar Alliance (ISA) has also been organized by the government. At the event, the framework agreement of the ISA would be kept open for signature, and India would also accept ratification documents from those countries that have completed the ratification process. So far, 25 countries have signed the ISA’s framework agreement while many other countries including Ghana, Mauritius, Yemen and Somalia have agreed to do so.
ISA, an initiative by Modi, was launched in November 2015 at the United Nations Framework Convention on Climate Change (UNFCCC).
Speaking about the solar sector, Adesina said that Africa has potential to generate 11 terawatts of solar-generated power.
“Africa cannot develop in the dark and we need to light up Africa…We want to connect 130 million people to the grid, 75 million people to off-grid systems and lot of that is going to be by solar power. African Development Bank is leading the solar revolution in the African continent,” he said, while adding that he believed that the ISA would work closely with AfDB for developing solar power projects in Africa.
AfDB has also set up a fund called the Facility for Energy Inclusion worth $500 million to fund small and medium-scale businesses in off-grid renewable energy.
“Through this fund, we will invest anywhere between $3-30 million dollars in companies that are setting up renewable energy projects with a capacity to generate below 30 megawatts of power,” he said.
To address the inadequate electrification in the African continent, Adesina said that AfDB is looking to invest $12 billion over the next five years and this could go up to $34 billion by 2025-26. This would leverage investment to the tune of $45-50 billion from the private sector, he added.