Foreign Policy Watch: India-Africa

Leverage similarity, complementarity in Nigeria

Explained | International Relations | Mains Paper 2: India & Its Neighborhood - Relations
Note4Students

From UPSC perspective, the following things are important :

Mains level: Importance of African countries;

Why in the News?

Prime Minister Narendra Modi will visit Nigeria, the most populous country in Africa and its second-largest economy.

Historical Background of Bilateral Relations between India and Nigeria

  • Long-standing Ties: India and Nigeria have maintained a bilateral relationship for over six decades, marked by shared values of democracy, pluralism, and economic cooperation. This partnership has evolved significantly since the establishment of diplomatic relations in 1960.
  • First Direct Contact: Historical ties trace back to around 1500 AD with the arrival of Baba Ghor, a gem merchant from Kano, who settled in Gujarat, symbolizing early trade connections between the two regions.
  • Strategic Partnership: The formalization of their strategic partnership began in 2007, focusing on economic, energy, and defense collaboration. Since then, both countries have engaged in multiple dialogues to strengthen their ties.
  • Cultural Exchange: Indian influence in Nigeria is notable through education and healthcare, with many Nigerians studying in India and receiving medical treatment there. Indian cultural products like Bollywood films are also popular among Nigerians

The Role of Soft Power in India-Nigeria Relations

  • Cultural Diplomacy: India’s soft power is evident through cultural exchanges, educational scholarships, and training programs that foster goodwill and strengthen people-to-people connections.
  • Healthcare Collaboration: India’s reputation as a destination for medical treatment enhances its soft power, with many Nigerians seeking healthcare services in Indian hospitals.
  • Capacity Building: Initiatives like the Indian Technical and Economic Cooperation (ITEC) program provide training to Nigerian professionals, contributing to human capital development and fostering long-term relationships.
  • Shared Values: Both countries share common challenges such as governance issues and socio-economic development needs, which can be addressed collaboratively through dialogue and mutual support.

Importance of Nigeria for India: 

  • Major Trading Partner: Nigeria is India’s second-largest trading partner in Africa, with bilateral trade valued at approximately $7.89 billion in 2023-24. This trade encompasses vital sectors such as crude oil, natural gas, pharmaceuticals, and renewable energy.
  • Investment Opportunities: Over 200 Indian companies have invested around $27 billion in Nigeria across various sectors, including infrastructure, manufacturing, and consumer goods.
  • People-to-People Ties: There is a significant Indian diaspora in Nigeria, comprising around 50,000 individuals who contribute to the local economy and foster cultural exchange. This community enhances bilateral relations through trade, education, and healthcare links.
  • Educational Collaboration: India has been a preferred destination for Nigerian students seeking higher education. Initiatives like the Indian Technical and Economic Cooperation (ITEC) program provide scholarships and training opportunities for Nigerians.

How India and Nigeria Can Enhance Their Economic Collaboration?

  • Strengthening Trade Agreements: Finalizing a comprehensive economic partnership agreement can facilitate smoother trade flows and address market access issues for both nations.
  • Local Currency Settlement: Implementing a Local Currency Settlement System can mitigate exchange rate risks and streamline transactions between the two countries.
  • Sectoral Cooperation: Focusing on key sectors such as hydrocarbons, pharmaceuticals, renewable energy, agriculture, and infrastructure can diversify economic exchanges and enhance mutual benefits.
  • Investment in Infrastructure: India can invest in Nigeria’s infrastructure development projects, leveraging its experience in various sectors to address Nigeria’s physical and social infrastructure deficits.
  • Utilizing the Indian Diaspora: Engaging the Indian diaspora in Nigeria as a bridge for business opportunities can enhance bilateral trade and investment flows.

Way forward: 

  • Strengthen Economic and Trade Partnership: Finalize a comprehensive economic partnership agreement and implement a Local Currency Settlement System to boost trade, reduce exchange risks, and expand collaboration in high-potential sectors like hydrocarbons, pharmaceuticals, and renewable energy.
  • Leverage Soft Power and People-to-People Connections: Enhance cultural diplomacy and skill development initiatives, expanding ITEC programs and engaging the Indian diaspora to deepen ties and foster mutual goodwill, creating a resilient foundation for bilateral relations.

Mains PYQ:

Q “If the last few decades were of Asia’s growth story, the next few are expected to be of Africa’s.” In the light of this statement, examine India’s influence in Africa in recent years. (UPSC IAS/2021)

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