India’s Development Partnership with Africa

The Claim Being Made

India does not give aid to Africa. That is not a euphemism but a formal position: the Government of India describes what it does on the continent as development partnership, and it refuses the vocabulary of donor and recipient wherever it can. The claim carries consequences. It commits India to instruments that look different from Western assistance, and it exposes India to the charge that the difference is presentational.

• India is a non-DAC provider. It is not a member of the OECD Development Assistance Committee, does not report its flows as Official Development Assistance, and is not bound by DAC definitions, untying commitments or peer review
• This is a choice, not an omission. India was itself a large aid recipient into the 1990s and continues to receive concessional finance; presenting itself as a donor would place it inside a hierarchy it has spent seventy years arguing against
• The consequence is a distinctive instrument set — concessional export credit rather than grants, training rather than budget support, projects requested by the partner rather than designed by the provider
• The cost is comparability. Because India’s flows are not reported on a DAC basis, its own figures are announcements and allocations rather than audited disbursements, which makes the partnership genuinely hard to evaluate and easy to overstate

“We are not here as an extractive economy. We are not here in the manner in which a lot of other countries are there for very narrow economic objectives. For us, this is a broader, deeper partnership.” — S. Jaishankar

The lineage of India’s Africa engagement, its phases and its strategic drivers are a separate question, treated on their own elsewhere in this unit; this article takes the policy as given and asks what India actually does with it. The instruments are the argument. If the partnership claim is sound, it should be visible in how the money moves, who chooses the projects, what conditions attach and what gets finished.

The Development Compact as the Organising Frame

The most useful framework for India’s development cooperation is the Development Compact, articulated by Sachin Chaturvedi, Director General of the Research and Information System for Developing Countries. It groups India’s instruments into five heads rather than treating them as an inventory of schemes, and it makes the design logic legible.

Instrument	What it is	Africa’s principal exposure
Capacity building	Training slots, study visits, deputation of experts	ITEC and SCAAP; the continent’s largest single draw
Concessional finance	Lines of credit on subsidised terms	IDEAS through the EXIM Bank; 196 LoCs, US$12 billion, 42 countries
Grants and small projects	Fully funded assets handed over	Pan-African e-Network, e-VBAB, hospitals, IT centres, solar
Preferential trade	Market access without reciprocity	Duty Free Tariff Preference for LDCs; Focus Africa
Technical cooperation and technology transfer	Experts, feasibility studies, replicable systems	Agricultural extension, digital public infrastructure, pharma

• The compact’s organising claim is that these five work together. A line of credit builds a plant, technical cooperation makes it run, capacity building supplies the operators, preferential trade gives the output a market, and grants cover what cannot bear debt
• The institutional home is the Development Partnership Administration, created inside the Ministry of External Affairs in 2012 to consolidate what had been scattered across divisions — the first attempt to give India a single development-cooperation bureaucracy
• The distinguishing procedural feature is that the partner writes the request. Projects arrive as proposals from partner governments, are appraised in New Delhi, and are then financed; India does not run a country-programming exercise that tells a partner what it needs
• The distinguishing financial feature is that project assistance carries no administrative charge on the recipient, a direct contrast with standard OECD practice, where a share of the assistance is consumed by the provider’s own overheads and consultants

Concessional Finance: Lines of Credit and the IDEAS Scheme

How the mechanism actually works

The line of credit is India’s largest single instrument in Africa by value and the one most often misdescribed. It is not a grant, not budget support and not a loan from the Indian state. It is subsidised export credit, routed through the Export-Import Bank of India under the Indian Development and Economic Assistance Scheme.

• The partner government asks. A sovereign borrower approaches India with a project; the Indian mission and the Ministry of External Affairs appraise it for developmental value and political fit
• The Department of Economic Affairs clears the concessional terms, and the EXIM Bank signs the credit agreement with the borrowing government or its designated agency and disburses against contracts
• The borrower carries the repayment obligation. India’s own fiscal exposure is narrow — a Deed of Guarantee protecting the EXIM Bank against default, and Interest Equalisation Support that pays down the difference between market and concessional rates
• The procurement is tied. Goods and services, consultancy included, worth a minimum of 75% of the contract value must be sourced from India, with a 10% relaxation available case by case; the Ministry’s own estimate is that the requirement is satisfied in about 94% of completed projects
• Borrowers are graded into income-based categories, with the softest terms reserved for the poorest and for countries under IMF concessional-borrowing limits

The volumes

The Ministry of External Affairs’ own accounting, as of August 2024, is the figure to use, because press variants circulate freely and disagree.

Measure	Figure
Global LoCs extended	more than 300, worth US$32 billion, to 68 countries, covering around 600 projects
Africa	196 LoCs, worth US$12 billion, to 42 African countries
Latin America and the Caribbean	US$811 million
Africa’s share of the global portfolio	roughly a third by value, and the largest count of individual credits

• The growth curve is steep and recent. India extended about US$304 million in lines of credit in 2004 and about US$4.3 billion by 2011; the scheme only became a serious instrument after the IDEAS framework was deepened in 2003–04
• The sectoral spread is wide — power transmission, rural electrification, railways, water and sanitation, irrigation, sugar and cement plants, hospitals, IT parks and, since 2018, solar
• Commitments at the summits set the ceiling. India pledged US$5.4 billion in concessional credit at the first India–Africa Forum Summit, another US$5 billion at the second, and US$10 billion over five years plus US$600 million in grants at the third
• The African Union has never been the main channel. Most credits are bilateral, negotiated country by country, which is why the summit architecture and the disbursement record diverge

What the volumes conceal

The honest reading of the line-of-credit record is that India’s announcement discipline is far better than its delivery discipline. Three separate problems compound: the terms are tied, the pipeline is slow, and the data does not permit outsiders to check either claim properly.

• Tied procurement narrows the market. A 75% Indian-content floor means the partner is buying Indian capital goods and Indian consultancy whether or not these are the cheapest or best available; the concession on the interest rate is partly recovered on the price of the contract
• Disbursement lags commitment badly. Independent scholarship puts India’s actual disbursal against announced concessional lending to Africa at roughly 40% of the sums announced; of the US$10 billion promised at the third summit in 2015, only about US$1.5 billion had been actually disbursed by 2019 — the figure for credit merely committed and allocated against that pledge is several times higher, which is why quoted progress on the summit record varies with the measure used
• Project delay is the recurring complaint. Sushmita Rajwar documents the pattern, with the Ethiopia–Djibouti railway the emblematic case: an Indian line of credit of about US$300 million was announced, India did not deliver, and China built the line
• Completion data is simply not published. Jai Bhatia shows that the EXIM Bank releases approved project values, not disbursements; releases nothing on project status, cost overruns, extensions or unused credit; and therefore makes it impossible to distinguish a portfolio that is working from one that is stalled
• The African Union Commission proved a weak implementing partner for the summit commitments, with project selection shaped by intra-continental politics rather than absorptive capacity — one reason India has drifted back toward bilateral delivery

A credit line is a commitment; a completed project is a fact, and India’s record is much stronger on the first than the second.

The distinction that is real: lending where others will not

Against that, one feature of the Indian portfolio is genuinely unusual and is not a presentational point.

• India lends to highly indebted poor countries and to least developed countries on the same instrument it uses elsewhere, where commercial and much official finance is available only to investment-grade borrowers
• This is the substantive content of “without discrimination” in India’s own description of the scheme, and it is why India appears in the credit histories of states that have almost no access to sovereign borrowing
• It is also a real risk transfer. Concessional lending to distressed sovereigns produces arrears; India’s exposure is smaller than China’s and has not become a political issue on the continent, but the difference is scale, not immunity
• The debt-sustainability argument therefore cuts both ways. India can claim it is not a source of distress; it cannot claim its instrument is structurally different from the one that produced distress elsewhere

The shift in the instrument mix

The line of credit is no longer the growing part of India’s Africa toolkit. Since the middle of the last decade the mix has moved, and the movement is an implicit admission about delivery.

• Grant assistance has been given more weight for small, quick, visible projects — community development, buildings, solar mini-grids, equipment — where the completion cycle is months rather than years
• Buyer’s credit under the National Export Insurance Account has grown as a commercial alternative, shifting risk to insurance rather than sovereign guarantee and taking some project finance out of the concessional frame entirely
• The EXIM Bank has moved to lending through African institutions — commercial lines to the ECOWAS Bank for Investment and Development and to the Africa Finance Corporation — which delegates project selection and appraisal to lenders closer to the ground
• The International Solar Alliance channel is the clearest case of earmarking, with a share of India’s concessional commitment reserved for solar and a US$2 billion concessional line for off-grid solar projects in Africa announced through it

Grants, Small Projects and the Institutions India Promised

Grant assistance is the smallest of India’s instruments by value and the most visible by effect. It funds things that cannot carry debt — a school, a clinic, a solar mini-grid, an artificial limb camp, a borehole — and hands them over outright. It is also where India’s summit promises are most easily checked, because an institute either exists or it does not.

• Grants have run alongside the credit lines from the beginning, with about US$600 million committed at the third summit against the US$10 billion in concessional credit announced at the same meeting
• The quick-impact model is deliberately small in unit size: projects in the low millions, executed within a year or two, chosen by the partner and often by a local community, on the argument that a hundred delivered clinics buy more standing than one delayed power plant
• India has executed close to two hundred development projects across some three dozen African countries on its own accounting, spanning water supply, rural electrification, technology centres, hospitals and public buildings
• The instrument’s weakness is its scale. Grant assistance to Africa is a fraction of what the European Union or the United States disburses in a single year, so the visibility argument has to do the work that money cannot

The institution-building commitments

The Plans of Action agreed at the first two summits promised Africa a set of standing institutions, built and equipped by India and maintained for three years before handover. The list is the clearest available test of whether India delivers what it announces.

Institution	Purpose
India–Africa Institute of Foreign Trade	Professional education in trade and international business
India–Africa Diamond Institute	Cutting, polishing and grading capacity
India–Africa Institute of Information Technology	IT skills and academia–industry linkage
India–Africa Institute of Education Planning and Administration	Educational planning capacity for ministries
Pan-African Stock Exchange	Capital-market capacity building
India–Africa Vocational Training Centres	Ten centres through the National Small Industries Corporation

• The division of labour was explicit: India would establish, equip and maintain for three years, and the host state would supply land, buildings, budget, governance and a business plan for the period after India stepped back
• Beyond the flagship list, the second summit’s plan committed India to roughly a hundred capacity-building institutions across the continent, from rural technology parks to soil-testing laboratories and seed-production centres
• Delivery has been partial and slow, and it has been slowest exactly where it depended on the African Union Commission to allocate a site — the same coordination failure that stalled the credit lines
• The design flaw is the three-year cliff. An institution handed to a ministry with no recurrent budget line does not survive it, and India has never published what happened to the ones it handed over

ITEC in Africa

The programme and its scale

The Indian Technical and Economic Cooperation programme, instituted in 1964, is the oldest institutionalised capacity-building arrangement of its kind anywhere and the flagship of India’s African engagement. Its role as India’s general South-South instrument is a separate subject; what follows is ITEC as it operates on the African continent, where the programme has always had its largest constituency.

• The cumulative record is more than 200,000 officials trained from 160-plus partner countries, in both the civilian and the defence streams
• Current annual capacity is close to 10,000 fully funded in-person training slots, delivered through nearly 400 courses at more than 100 institutions in India, with all costs — airfare, tuition, accommodation, stipend — met by the Government of India
• Africa became ITEC’s largest user early and has stayed there. The programme was extended in 1964 alongside the Special Commonwealth African Assistance Plan, and after 2002 was opened to Africa’s regional economic communities and to the African Union Commission as institutional partners rather than only to states
• Africa’s slot allocation grew sharply in the summit decade — from about 1,704 slots in 2008-09 to roughly 4,000 by 2014-15 — and SCAAP’s own budget rose from about US$2.56 million to US$5.43 million across the same period
• On the programme’s own historical accounting, cumulative ITEC spending has been put at around US$3 billion, with roughly US$1 billion of it in Africa, and about 40% of the budget devoted to project assistance rather than training — though reported spending figures differ across official statements (annual outlays have been given as anything from about US$20 million to some US$150 million), so the participation figures are the robust ones

The four modalities

ITEC is not a scholarship scheme. It runs four distinct lines of activity, and the second and third are the ones most often missed.

Modality	Content	African form
Capacity building	Training slots in India; deputation of Indian experts to partner countries; study visits for senior decision-makers	Civil service, police, audit, parliamentary staff, rural banking, statistics, elections
Project assistance	Small and medium industry projects — identification, feasibility, implementation, operator training	Agro-processing, agricultural tools, carpentry, plastic moulding, brick-making
Institution building	Standing institutions handed to the partner	Vocational training centres, entrepreneurship development institutes, IT and business-management centres, agriculture and animal husbandry institutes
Scholarships	Degree study in Indian universities	Administered through the Indian Council for Cultural Relations

• The military academies came first. India established a military academy at Harar in Ethiopia in 1958 and a second in Nigeria in 1960, before ITEC existed — the earliest evidence that capacity building, not finance, was always India’s chosen entry point
• Institution building is the modality that survives the exit. A vocational institute continues producing trained people after the Indian expert has gone home, which is what “sustainable” means in the programme’s own language
• The no-overhead rule is the sharpest contrast with OECD practice. India’s project assistance is not loaded with administrative expenses to be borne by the recipient, whereas a material share of DAC assistance returns to the provider as fees, technical assistance costs and management charges

The newer delivery tracks

The programme’s structure has been extended since 2020, largely under the pressure of the pandemic, and the extensions changed its reach more than its budget.

• e-ITEC delivers courses online; during the pandemic it trained close to 10,000 professionals through digital platforms, and its COVID-19 management webinars for African and South Asian health workers — with Nigeria, Kenya, Mauritius and Namibia among the beneficiaries — were the fastest capacity response India made anywhere
• ITEC Onsite sends Indian trainers to deliver courses in the partner country, which removes the visa, travel and slot-allocation frictions that suppress uptake
• ITEC Executive runs short, policy-level programmes for senior officials, aimed at decision-makers rather than mid-career technicians
• ITEC Expert covers individual expert assignments abroad, the oldest of the modalities in a new label
• Customised country programmes are now designed on request outside the annual calendar, which is the practical meaning of “demand-driven” at the level of a single course

Scholarships and the flow India does not fund

• ICCR scholarships cover graduate and postgraduate study across humanities, science, engineering and medicine; the India–Africa Maitri Scholarship Scheme is the continent-specific instrument, with slots allotted country by country and revised upward year to year
• The self-financing flow is now several times larger than the scholarship flow. Indian universities admit African students who pay their own fees, and the numbers dwarf government placements — around 55,000 African students have been reported studying in India
• This is a policy asset India does not pay for, and it is the reason the education link long predates and outruns the aid link
• It is also the most exposed part of the relationship. Incidents of racism and violence against African students in India damage the partnership at exactly the point where it is most personal, and the remedy is institutional grievance redress, not more scholarships

The Pan-African e-Network and its successor

• Announced by President A.P.J. Abdul Kalam to the Pan-African Parliament in the mid-2000s and launched in February 2009, the Pan-African e-Network remains India’s largest grant project in Africa — a satellite network for tele-education and telemedicine costing about ₹540 crore (US$125 million) as a pure grant
• It connected 47-plus African countries, with the hub earth station in Senegal, linking Indian universities and 12 super-speciality hospitals to African campuses and clinics; it was adopted as an African Union flagship and completed its first phase in 2017
• The successor is e-VidyaBharati and e-ArogyaBharati (e-VBAB), launched in October 2019 — web-based rather than satellite-based, with two separate portals for tele-education and telemedicine
• e-VBAB was funded for 15,000 scholarships for African students in fully funded online degree, diploma and certificate courses across more than 300 offerings, with continuing medical education and clinical consultation on the health side
• Uptake has been real but uneven. Well over 14,000 scholarships had been awarded by 2024 across roughly 22 African states, with Malawi alone enrolling more than 1,900 students; concentration in a handful of countries is the pattern, not the exception

Has ITEC earned goodwill? The case for

The claim that ITEC has earned India “much goodwill” in Africa is defensible, and the reasons are specific rather than sentimental.

• The alumni-network effect is the strongest evidence. Sixty years of training has placed ITEC graduates inside African civil services, central banks, audit offices, police forces and armed forces, and more than a dozen current or former African heads of state and government are graduates of Indian educational and training institutions
• The visibility-to-cost ratio is extraordinary. ITEC’s annual outlay is trivial next to India’s other foreign-policy expenditures, and it buys personal, career-long relationships with serving officials — the cheapest influence India purchases anywhere
• There is no conditionality attached and no overhead charged, so the offer is legible to a partner government as a gift of skill rather than an instrument of leverage
• It is genuinely demand-driven at the course level. A partner ministry nominates its own officials for courses it selects, which means the training maps onto priorities the partner has already set
• It reaches states that have no other partner of scale. Small and land-locked African states with no strategic weight receive the same slots as large ones, which is why India’s diplomatic reputation on the continent is broader than its economic footprint

“Our offer of development aid, our development model is not based on ‘give and take’, but is guided by the developmental requirements of partner countries.” — Narendra Modi

Has ITEC earned goodwill? The case against

The counter-case does not deny the goodwill. It denies that goodwill is the same thing as effect, and it identifies four structural weaknesses.

• Diffuseness. Nearly 400 courses across 100-plus institutions and 160-plus countries is a portfolio without a thesis; slots are allocated by quota rather than concentrated where a sector could be transformed
• The absence of impact evaluation is the central failure. Neither the Ministry nor the empanelled institutions publish tracer studies on whether trainees applied what they learned, were promoted, or stayed in public service; Chaturvedi himself identifies impact assessment and evaluation as the capability India most needs to build
• Course-to-demand mismatch. The calendar reflects what Indian institutions can teach, not what African administrations most need; the drift toward ITEC Onsite and customised programmes is an admission of the problem
• Goodwill is not leverage. African states voted with India on the TRIPS waiver and on Security Council reform for reasons of their own interest; there is no case in which ITEC-trained officials have delivered a decision India wanted and Africa did not
• The teaching presence has decayed. Anil Trigunayat notes that India’s once-substantial deputation of teachers and professionals to African universities and schools, strong from the 1960s to the 1980s, “dried out and needs to be revived” — the human channel narrowed even as the training numbers grew

Goodwill is real, cheap and abundant; it is also the form of influence that is hardest to spend.

Trade: The Instruments and the Numbers

The current position

• Bilateral trade in FY 2025-26 was US$93.69 billion, up 14.39% — India’s exports US$45.42 billion, imports US$48.27 billion, announced by Commerce and Industry Minister Piyush Goyal in May 2026
• The trajectory is the point. Trade was about US$7 billion in 2001, US$56 billion in 2015-16, US$82 billion in 2024-25 (exports US$42 billion, imports US$40 billion) and has now crossed US$90 billion
• India is consistently among Africa’s four largest national trading partners, behind China and well behind the European Union as a bloc
• India runs a persistent deficit with the continent, which is a structural consequence of the composition rather than a policy failure — India buys energy and minerals and sells manufactures and services

“We should look at doubling the trade by 2030. It is a bold target but achievable.” — Piyush Goyal

Composition

Direction	Principal items
India’s imports from Africa	Crude oil, gold, LNG, phosphoric acid, coal, shelled cashew, pulses, timber, copper and cobalt concentrates — resource-based and highly concentrated
India’s exports to Africa	Refined petroleum products and pharmaceuticals, together around 40% of the total; two-wheelers and vehicles; machinery and agricultural equipment; textiles; chemicals; cereals; increasingly IT and digital services
The mining and minerals segment	Cumulatively tens of billions since 2001, with India a net importer on roughly a 23:77 export-import split

• Six countries dominate the import side — Nigeria, South Africa, Angola, Egypt, Algeria and Morocco have accounted for the overwhelming majority of African export value to India, and crude alone has at times been about 60% of it
• The concentration is the vulnerability. A trade relationship carried by four commodities and six partners is exposed to price cycles and to substitution, which is exactly what happened when Russian and West Asian barrels displaced African crude in India’s import basket
• Africa’s share of India’s crude imports has fallen well below the quarter it once approached, with Nigeria and Angola together in the low single digits to around a tenth depending on the quarter, against roughly three-fifths from West Asia and Russia
• The unrealised export markets are specific. Africa imports about US$20 billion of motor cars a year and India supplies about US$2 billion of it — the clearest single illustration that India’s African trade is far below its manufacturing capability

Focus Africa and the market-access instruments

• Focus Africa was launched by the Ministry of Commerce in 2002, initially targeting seven major sub-Saharan partners — Ethiopia, Tanzania, Nigeria, South Africa, Mauritius, Kenya and Ghana — which then accounted for about 69% of India’s sub-Saharan trade
• It was expanded in 2003 to seventeen more countries and into North Africa, largely because every African state wanted to be inside it; the enthusiasm outran the design, and the programme was eventually folded into general export promotion
• The CII–EXIM Bank Conclave on India–Africa Project Partnership, running since 2005 with support from the Ministries of External Affairs and Commerce, is the standing business-to-business channel and the venue at which African ministers and Indian project exporters actually meet
• The India–Africa Business Dialogue and Exhibition was designed as the commercial companion to the fourth summit, and was deferred along with it — which means the trade architecture, like the political architecture, is currently running without its apex event

The Duty Free Tariff Preference scheme and its utilisation problem

The DFTP scheme for least developed countries, in force from 13 August 2008 and substantially expanded in August 2014, is India’s most generous unilateral trade instrument and its least effective one. The gap between the two is the standard case study in why market access alone does not create trade.

• The scheme’s terms are genuinely liberal. Duty-free access initially on about 85% of India’s tariff lines, raised to about 98% in 2014; the current position leaves only a very small exclusion list and a short margin-of-preference list, with everything else duty-free
• India was the first developing country to offer duty-free access to LDCs, which is a real claim on South-South credibility and predates most comparable schemes
• Uptake is poor and Africa’s share of the benefit is small. Only around 35 of the eligible LDCs have completed the paperwork to participate; beneficiary countries’ share of India’s total imports moved only marginally, from around 0.76% to 0.82% between the pre- and post-scheme periods
• Four reasons account for the failure, and they are cumulative rather than alternative:
  • Rules of origin. Value-addition requirements without regional cumulation mean an African LDC that assembles inputs from its neighbours can fail to qualify; exporters have reported that the “thin marginal benefit” does not justify the compliance burden
  • Awareness. Exporters and even exporter associations in beneficiary states have been found largely unaware that the scheme exists — a failure of Indian commercial diplomacy, not of African capacity
  • Supply capacity. Many African LDC firms cannot produce at the volumes an Indian buyer needs, so a tariff concession has nothing to attach to
  • Product coverage where it matters. Exclusions and margin-of-preference lines have covered items African LDCs actually export — coffee, tea, some spices and oilseeds, milk and cream, cashew kernels, tobacco — which protects Indian farmers at the cost of the scheme’s purpose
• The distribution of gains is the sharpest finding. Asian LDCs, above all Bangladesh, captured most of the benefit, while several African beneficiaries — Zambia, Rwanda, Eritrea, Burundi — saw exports to India fall after implementation

Services, and the part of the relationship that is not counted

• Merchandise figures understate the relationship because India’s African business is increasingly in services that clear through subsidiaries rather than customs — telecommunications, banking software, hospital management, education and IT-enabled processing
• Bharti Airtel’s African operations are the largest single instance: a pan-continental telecom business serving tens of millions of subscribers, whose revenue never appears in bilateral trade data
• Medical travel is a second uncounted channel, with African patients travelling to India for treatment at a fraction of European or Gulf prices; the visa friction that Indian business complains about bites here too
• The policy implication is that India’s African economic presence is bigger than its trade balance suggests, and that the instruments best suited to it — mutual recognition of qualifications, digital trade facilitation, visa liberalisation — are the ones India has done least about

The delivery machinery

• Trade and credit both depend on people on the ground, and India’s diplomatic footprint in Africa was until recently among the thinnest of any major partner relative to the continent’s size
• The Government approved eighteen new Indian missions in Africa in March 2018, to be opened over four years, specifically to implement the commitments made at the third summit — an admission that the promises had outrun the machinery
• The Development Partnership Administration remains small for a portfolio of six hundred projects worldwide, which is the structural reason appraisal and monitoring are slow
• India also lacks a project-implementation agency of the kind China and Japan possess; execution is contracted out to Indian firms whose incentives are commercial, and there is no standing capacity to replace an underperforming contractor quickly

AfCFTA as an opportunity India engages

• The African Continental Free Trade Area has been operating as a trading regime since 1 January 2021, and India has supported it politically from the outset without being party to it
• Goyal has put the AfCFTA market at about US$3.4 trillion against an Indian economy of roughly US$4 trillion — a comparison intended to argue that Africa is a market of Indian scale, not a periphery
• The practical Indian interest is in a single set of rules. A continental market with harmonised tariffs and rules of origin removes the fifty-four-way negotiation problem that has kept India’s African trade bilateral and shallow
• India has no trade agreement with the continent or with any African bloc, and this is the largest single gap in the instrument set; the mechanics of AfCFTA itself belong to the study of African regionalism, not to India’s Africa policy

Investment and the Private Sector

The headline figure and the Mauritius problem

• Cumulative Indian investment in Africa is put at about US$75 billion, with an Indian government estimate of roughly US$80 billion across 1996–2025; India has ranked as high as the fourth-largest and is consistently among the largest investors from a developing country
• The number is inflated and everyone serious about it says so. Malancha Chakrabarty showed that of about US$52.6 billion of Indian FDI recorded as flowing to Africa between 2008 and 2016, US$47.6 billion went to Mauritius
  • That leaves about US$5 billion — roughly 2% of India’s global outward FDI — for the whole of the rest of the continent
• A large share of the Mauritius flow is round-tripped back into India for tax reasons, which means it is not African investment at all; the reported figure and the real footprint differ by an order of magnitude
• What remains is severely concentrated. East and North Africa have drawn about 85% of the flows, the top ten recipients about 90%, and roughly eleven companies have accounted for about 80% of the total
• Mozambique’s apparent dominance is a single asset. It has topped the country list largely because of ONGC Videsh’s stake in Rovuma, the offshore gas field, which accounts for the overwhelming bulk of Indian investment there

Who is actually there

• Public sector energy first. ONGC Videsh, Oil India and Gujarat State Petroleum Corporation moved into Africa after 1991 as energy security became an explicit foreign-policy objective; OVL holds a 16% net interest in Mozambique Rovuma Area-1, producing stakes in South Sudan’s Greater Nile and Block 5A, and an exploration block in Libya
• Private sector breadth second. The Tata Group, Bharti Airtel, Essar, Reliance, Varun Beverages, Mahindra, Bajaj, Cipla, Sun Pharmaceutical and Dr Reddy’s are the recognisable names, concentrated in telecommunications, pharmaceuticals, consumer goods, vehicles, agriculture and infrastructure
• The employment argument is the strongest one India makes. Indian firms hire locally at a scale Chinese contractors do not, and a former Nigerian president’s observation that Indian industrialists were the second-largest employer in Nigeria after the federal government is the most-cited evidence for it
• The failures are as instructive as the successes. India’s public sector energy companies have relinquished blocks they acquired in several African states, and some Indian agribusiness ventures have been criticised for land acquisition that displaced local populations — the “land grab” charge is not only made against China

The eight concerns of Indian business — the practical reform agenda

Indian businesses operating in Africa, meeting with the Indian High Commission and African embassies, produced a list of eight demands. It is the most useful reform agenda available because it comes from the people bearing the transaction costs, and because most of it is within India’s own power to fix.

Concern	What it actually means	Difficulty
Improve the line of credit system	Compress appraisal-to-disbursement time; publish project status; relax the 75% content rule where Indian supply is genuinely absent	Domestic, low cost
Set up banks	Indian banks have almost no African branch presence, so trade finance, letters of credit and working capital run through third-country banks at a premium	Domestic, regulatory
Liberalise the visa system	African businesspeople and technicians cannot move to India quickly; the friction falls hardest on small firms	Domestic, politically sensitive
Direct flights	Few non-stop routes between Indian and African cities; a Mumbai–Nairobi trip can cost a day each way via the Gulf	Commercial, needs traffic
Rupee-denominated trade	African importers face acute dollar shortages; rupee settlement would let trade continue when hard currency does not	Needs partner consent
A buyer–supplier database	Neither side knows who on the other side makes what; matchmaking is currently done by conclave rather than by data	Cheap and undone
A trade dispute settlement mechanism	Contract enforcement risk is the single largest deterrent to a mid-sized Indian exporter	Needs treaty architecture
FICCI and CII country chapters in Africa	Permanent industry presence rather than annual delegations	Industry-funded, easy

• Six of the eight cost India almost nothing. A database, industry chapters, faster credit processing, published project status, bank presence and visa reform are administrative decisions, which makes their non-delivery a statement about priority rather than capacity
• Two require partners. Rupee trade needs a willing central bank on the other side, and dispute settlement needs bilateral investment treaties India has been reluctant to sign since it rewrote its model text
• Direct connectivity is the binding physical constraint. Air links follow traffic and traffic follows air links; without a subsidised or protected route the deadlock holds, and the diaspora and student flows that could break it are not counted as commercial demand

Sectoral Partnership

Energy: from hydrocarbons to sunlight

• The hydrocarbon phase is maturing, not growing. Indian state companies invested heavily in African oil and gas from the 2000s, and Africa’s share of India’s crude imports rose from effectively nothing in 2000 to a substantial fraction before falling back as cheaper Russian and West Asian barrels arrived
• Gas is the durable asset. Mozambique’s Rovuma discoveries, in which OVL holds a stake alongside a French operator, are among the largest recent gas finds anywhere and tie India to Mozambican security in a way no line of credit does
• The renewables pivot runs through the International Solar Alliance, the India–France initiative of 2015 headquartered at Gurugram; African states form the alliance’s largest bloc, which makes the ISA the only multilateral institution India has created where Africa is the demographic centre
• ISA’s African programme is concrete. India pledged a US$2 billion concessional credit line for off-grid solar in Africa through the alliance, and the ISA has partnered the African Development Bank to develop solar capacity across the Sahel, aimed at a population of which roughly 600 million remain off-grid
• The commercial follow-through has begun. NTPC won the project management consultancy contract for a 500 MW solar park in Mali and Togo in 2020 — India’s first substantive position in African solar delivery — and has been pursuing similar mandates in other ISA member states
• The asymmetry ISA is designed to exploit is real. African states hold the irradiance and India holds the engineering, financing and manufacturing; this is the clearest instance in the whole partnership of India offering a system rather than an asset
• Critical minerals are the next frontier and India is late. KABIL and NMDC have pursued copper and cobalt in Zambia, lithium and rare earths in Malawi, the DRC, Zimbabwe, Mozambique and Côte d’Ivoire
  • The target is fifty overseas critical-mineral assets under the National Critical Mineral Mission; the Zambian exploration negotiation collapsed in 2024 over mining-rights assurances and was revived only in 2026

Agriculture and food security

The agricultural relationship rests on one asymmetry that both sides recite: Africa holds about 60% of the world’s uncultivated arable land and produces about 10% of global agricultural output. India’s claim is that it, rather than a mechanised Western agriculture, has the relevant experience, because Indian smallholding resembles African smallholding.

• Pulses are the working example. India is the world’s largest producer, consumer and importer of pulses, and faces structural shortfalls in tur and urad; MoUs signed with Mozambique and Malawi in 2021 commit those states to grow pulses for the Indian market against guaranteed minimum procurement price and quantity, with parallel arrangements involving Tanzania
• This is contract farming exported as policy. India has taken its cooperative and contract-farming model to Mozambique, Tanzania, Kenya and Malawi — a demand-guarantee instrument rather than an aid instrument, and the closest thing in the partnership to genuine mutual benefit
• Machinery and inputs are the commercial channel. Indian tractors, pumps, agricultural implements and agrochemicals are competitively priced for African smallholders in a way European equipment is not, and lines of credit have repeatedly financed tractor and irrigation procurement
• Agribusiness incubation centres and agricultural training under ITEC form the capacity layer; India has funded doctoral and masters places for African agricultural scientists alongside the African Union’s own programmes
• The honest limits are three. India is not a leader in agricultural research and cannot play the role the United States played for India in the 1960s; Indian agriculture is itself water-stressed and drought-prone; and India’s agricultural cooperation has stayed small — training scientists and funding irrigation schemes rather than transforming productivity
• There is still no coherent India–Africa agricultural productivity strategy, despite food security being named a pillar at every summit, and the India–Africa Framework for Strategic Cooperation of 2015 committing both sides to it
• The forward agenda is climate-smart agriculture for small farmers on both sides, plus millets, food processing and cold chains — where Indian technology is appropriate and the domestic market gives Indian firms a reason to invest

Health and pharmaceuticals

This is the sector where India’s claim to be irreplaceable is strongest, and it rests on price rather than on generosity.

• Africa imports roughly 70–80% of its pharmaceutical products, and India supplies a very large share of the generics inside that — antiretrovirals, antimalarials, antibiotics, tuberculosis regimens — through Cipla, Sun Pharmaceutical, Dr Reddy’s and others
• Pharmaceuticals plus refined petroleum are about 40% of India’s exports to Africa, and pharmaceutical trade with the continent has repeatedly set records, crossing US$3.8 billion in 2020-21
• The price argument is the whole argument. Indian generic antiretrovirals cut the annual cost of HIV treatment from thousands of dollars to tens, which is the single largest contribution any country has made to African public health in this century
• The finished-formulation strength conceals an upstream weakness. India supplies formulations; China supplies the active pharmaceutical ingredients, including much of what Indian manufacturers use, so “India as Africa’s pharmacy” describes the last stage of a Chinese-anchored supply chain
• The pandemic record is real and was interrupted. India shipped about 150 tonnes of medical assistance to more than 30 African countries and sent essential medicines, including hydroxychloroquine and paracetamol, to about 25 of them
  • Covishield and Covaxin reached more than twenty African states under Vaccine Maitri, Seychelles first among them, alongside e-ITEC clinical webinars for African health workers
• The interruption matters more than the shipments. India’s export restrictions from April 2021, imposed under domestic pressure during its second wave, stopped supply to African states and to COVAX at the moment of greatest need, and demonstrated that a single-source dependence on India carries the same political risk as any other
• The quality controversies must be stated fairly, not defensively. The 2022 Gambia episode, in which the World Health Organization linked contaminated cough syrups manufactured in India to the deaths of dozens of children, triggered an Indian regulatory investigation that found serious manufacturing breaches and halted production at the plant; similar contamination alerts followed elsewhere
• The lesson is regulatory, not reputational. India’s answer cannot be that most Indian medicine is safe; it has to be tighter export-quality enforcement, because the credibility of the whole sector rests on a claim about standards
• The strategic tension ahead is African localisation. The African Union’s target of producing about 60% of the continent’s vaccine requirement locally by 2040 is, read commercially, a plan to displace Indian imports
  • Read as partnership, it is an invitation to co-production and technology transfer, and which reading India acts on will decide whether this sector survives as cooperation at all
• India and South Africa’s joint TRIPS waiver proposal of October 2020 is the multilateral expression of the same relationship — the negotiating record belongs to India’s WTO story, but the fact that Africa’s largest economy and India co-authored it is a health-cooperation fact

Digital public infrastructure

• This is the newest instrument and the one that best fits India’s comparative advantage — an offer of a replicable public system rather than a built asset or a loan
• The Pan-African e-Network and e-VBAB were the first generation; the second generation is the export of India Stack — identity, payments and document infrastructure — as open, adaptable public code
• Six African states — Sierra Leone, Tanzania, Kenya, Ethiopia, The Gambia and Lesotho — have signed on to access India’s DPI stack, covering some eighteen platforms including Aadhaar-model identity, UPI-model payments, DigiLocker, e-Hospital, eCourts and the DIKSHA learning platform
• The payments track is separately advanced. NPCI International signed with the Bank of Namibia in 2024 to build a UPI-model instant payment system, with a comparable arrangement for Ghana’s interbank settlement system and discussions with Rwanda; the first live systems are expected toward 2027
• The appeal is cost and sovereignty at once. Open-source public infrastructure is cheaper than a licensed vendor platform and leaves the state owning the rails — the strongest available counter to the argument that partnering a larger economy means dependence
• The unresolved questions are the serious ones. India exports the architecture without exporting the data-protection statute, the grievance mechanism or the judicial oversight that should accompany it, and identity systems in states with weak civil-liberties protection can do harm the Indian offer does not address

Education and skills

• Institution building is where the education instrument is most durable — vocational training institutes, entrepreneurship development institutes and IT centres established under ITEC and handed over
• The IAFS-2 proposal for an India–Africa Virtual University followed directly from the e-Network’s uptake, and its partial realisation as e-VBAB is a case of an announcement being scaled down to what could be delivered
• The skills agenda is the pillar India shares with Japan under the Asia–Africa Growth Corridor, and the one India was assigned in that division of labour because Japan holds the infrastructure competence
• The demographic case for concentrating here is simple. Africa’s median age was 18.78 in 2023 against a world median of 30.5, and about two-thirds of the combined Indian and African population is under thirty-five; the binding constraint on both economies is trained people, not capital

Is This Genuinely South-South Cooperation?

The case for

Six features of the Indian model are structurally different from DAC assistance, and each can be checked against the instruments described above.

• Demand-driven at the point of origin. The partner government proposes the project; India appraises and finances. There is no Indian country strategy that tells a partner what its development priorities are
• No policy conditionality. India attaches no macroeconomic, governance or human-rights conditions to a line of credit or a training slot, which is a genuine departure from both Bretton Woods practice and European aid
• No administrative charge on the recipient in project assistance, against a standard OECD practice of loading provider overheads onto the assistance envelope
• Capacity before concrete. The bulk of India’s cumulative effort is in people and institutions rather than assets, which is where the benefit survives the provider’s departure
• Mutual-benefit framing without embarrassment. India says openly that it expects commercial returns, which is more honest than the altruism framing and closer to how partner governments actually read the relationship
• And access without a credit rating. India lends to HIPCs and LDCs, which is the most concrete meaning “solidarity” acquires anywhere in the instrument set

The case against

• Tied procurement is conditionality by another name. A 75% Indian-content requirement determines who supplies, at what price and with which technology; it does not dictate the partner’s policy, but it does dictate the partner’s purchasing, and the distinction is thinner than India’s rhetoric allows
• Commercial interest visibly drives sector selection. The energy, minerals, pulses and pharmaceutical priorities map onto Indian requirements with precision; the case for concentrating development projects where Indian firms have interests has been argued explicitly in Indian policy writing, which makes the “development partnership” description partly a marketing choice
• Non-conditionality has meant working with whoever holds power. India’s silence on governance has kept it welcome in states whose own citizens do not endorse their governments, and the argument that this is respect for sovereignty is also an argument for indifference
• The delivery gap undercuts the moral claim. A partnership that announces ten billion dollars and disburses a fraction of it has taken the diplomatic benefit of generosity without paying its cost
• Africa is a market as much as a partner, and India’s export-promotion instruments — Focus Africa, the conclaves, the DFTP scheme it under-promotes — read differently when set beside its investment concentration in eleven companies and six countries
• The evaluation vacuum protects the claim from testing. No published disbursement data, no project-status data, no impact evaluation of ITEC: the model’s virtues are asserted rather than demonstrated, and a partnership that cannot be audited cannot be defended against the charge that it is aid with better branding

The dissent from the other direction

Not every critic wants India to be more generous. The sharpest Indian critique is that India is being generous in the wrong way.

• Mahesh Sachdev’s position is that India is itself a developing country with resource constraints and should not be treated as a cash cow; that it should attach conditionalities to development assistance; and that it needs a far tighter connection between development aid and economic engagement
• The argument is that unconditional assistance is unserious, because a provider that asks for nothing gets nothing, and India’s African portfolio has produced goodwill without producing markets, contracts or reciprocal positions at scale
• The counter is that conditionality is the one asset India cannot spend. India’s entire claim to Southern leadership rests on not doing what the North does; conditionality would purchase leverage at the price of the identity that makes India’s offer distinctive
• Both positions accept the same finding — that the partnership underperforms — and differ only on whether the fix is more discipline on India’s side or more demands on Africa’s
• The reconcilable version of Sachdev’s point is that India should condition nothing on policy and everything on performance: milestones, co-financing, published project status and pipeline discipline are demands India can make without becoming a donor

A reform programme, sequenced by cost

Reform	What it requires	Whose consent
Publish disbursement and project-status data	An EXIM Bank and MEA reporting decision	India alone
Commission independent impact evaluation of ITEC and the LoC portfolio	A budget line and a willingness to be evaluated	India alone
Compress appraisal-to-first-disbursement time and set a completion covenant	Administrative reform in the DPA and EXIM Bank	India alone
Build the buyer–supplier database and open FICCI/CII country chapters	Industry money and a mandate	India and industry
Promote the DFTP scheme actively and add regional cumulation to its rules of origin	Commercial diplomacy plus a customs notification	India alone
Relax the 75% content rule where Indian supply is absent	A finance-ministry decision on the concession’s purpose	India alone
Indian bank branch presence and more direct air links	Regulatory clearance both sides; route economics	India and partners
Rupee settlement facilities for African importers	Central bank agreements	Partner consent
Co-production and technology transfer in pharmaceuticals	Commercial terms Indian firms will resist	Firms and partners
A trade dispute settlement architecture and investment treaties	A change in India’s treaty posture	Negotiated
Hold the fourth summit and institutionalise mid-term review	Political decision and epidemiological conditions	India and the African Union

• The sequencing point is that the highest-value reforms are the cheapest. Publishing data, evaluating programmes and speeding up disbursement need no partner’s agreement and no new money, and they address the criticism that does most damage
• The hardest reform is the one that matters most for scale — an institutional trade and investment framework with the continent, which India has never attempted and which the AfCFTA now makes conceivable
• The summit gap is the political cost. The last India–Africa Forum Summit was IAFS-3 in New Delhi in October 2015, and the fourth has been postponed three times, most recently in May 2026 on health grounds jointly with the African Union
  • That leaves a gap of more than a decade in the relationship’s apex mechanism, while China, Japan and the European Union have all convened theirs on schedule

The reforms that would most change how India’s partnership is judged are the ones no partner has to agree to.

The Alternatives Compared

India’s instruments only make sense against the alternatives available to an African government, and the comparison should be about model rather than volume.

	China	European Union	Japan	India
Core instrument	State-directed lending and turnkey construction	Grants and budget support	Quality-infrastructure finance and ODA	Concessional export credit, training, grants
Conditionality	Non-interference; commercial terms	Governance, human rights, democracy	Standards and procurement transparency	None on policy; 75% Indian content
Labour	Largely imported contractor workforce	Consultant-heavy	Contractor-led	Local hiring; long-settled diaspora
Scale	Overwhelming	Large; Africa’s largest trade partner as a bloc	Moderate	Modest
Sectors	Infrastructure, ports, mining, telecom	Governance, health, climate, trade	Ports, transport, industrial corridors	Pharma, IT and DPI, agriculture, education, health, solar
What it offers that others do not	Speed and scale of delivery	Market size and regulatory anchoring	Standards and lifecycle quality	Affordable medicines, trained officials, replicable public systems

• The Asia–Africa Growth Corridor is India’s answer to the scale problem. Announced with Japan at the African Development Bank meeting in Gandhinagar in 2017, it pairs Japanese quality infrastructure with Indian skills and capacity building across four pillars — development and cooperation projects; quality infrastructure and institutional connectivity; capacity and skills; and people-to-people partnership
• AAGC’s distinguishing features are consultative project selection and mixed funding — private, governmental and multilateral, including the African Development Bank — against a Chinese model financed and decided in Beijing
• AAGC’s problem is that it has not been funded. It remains a vision document with a consultative character and little disbursement, and it neither matches nor was designed to match the Belt and Road’s ambit
• The competitive comparison with China is a separate argument taken up on its own terms elsewhere in this unit; what belongs here is that every instrument described above is one where scale is not the operative variable, which is the only reasonable place for India to compete

Conclusion

India’s African instruments are better than their reputation in design and worse than their reputation in delivery. The Development Compact is a coherent framework, the line of credit reaches borrowers nobody else will lend to, ITEC has built a network inside African administrations that no amount of infrastructure finance can buy, and the newest offer — public digital systems and affordable medicine — is precisely the offer a young, under-served continent needs.

• What the record establishes is that India’s model is genuinely different: demand-driven, unconditional on policy, capacity-first, and free of the overhead extraction that characterises much OECD assistance
• What the record does not establish is that it works, because India has chosen not to publish the data that would show whether it does
• The single reform that would change the argument is transparency — disbursements, project status and independent evaluation — because it would convert a claim into evidence
• The deeper test is whether India can be a partner and a competitor at once. African localisation in vaccines, African rules under the AfCFTA and African insistence on value addition rather than raw-material export all point the same way, and Goyal’s own formulation concedes it

“The next phase of India-Africa partnership must move beyond traditional raw material trade towards higher-value products, integrated supply chains, local manufacturing and technology-driven cooperation.”

— Piyush Goyal

The partnership will be judged, in the end, on whether India is willing to be displaced in the sectors where it currently profits — to co-produce medicine rather than export it, to transfer agricultural technology rather than contract for output, to hand over digital rails rather than license them. That is what South-South cooperation would require. India has the instruments for it and has not yet made the choice.