The Export-Import Bank of India (India Exim Bank), also known as EXIM Bank, released a research report titled “Reinvigorating India’s Economic Engagements with Southern Africa” during the commencement of the CII-Exim Bank Regional Conclave on India-Southern Africa Growth Partnership in Johannesburg, South Africa.
- According to the report, India has emerged as a leading defence exporter in recent years and could be able to fulfil Africa’s maritime, aerospace, and defence needs, with Mauritius, Mozambique, and the Seychelles becoming major buyers of Indian armaments during 2017 – 2021.
Key Report Recommendations
i.The research proposed a transition in India’s approach to defence and security cooperation with Africa and other developing countries from its existing need-based approach that focuses on empowerment through training, capacity building, and humanitarian assistance.
- Cooperation in areas such as aerospace, defence, maritime equipment, and vessels can help to ensure Africa’s security and technological competence.
ii.This could help India meet its goal of USD 5 billion in defence exports by 2025.
- The network currently includes Indian military vehicle manufacturers like Tata Motors and Ashok Leyland.
iii.The nodal agency for National Cyber Security in India is the Computer Emergency Response Team (CERT-In), under the Ministry of Electronics and Information Technology (MeitY).
- This could help Africa adapt to new technologies as it sees a rapid increase in mobile smart device ownership and social media usage.
Highlights of the Report:
i.A safe and secure maritime environment in the Indian Ocean Region (IOR) is vital to both India and African nations, particularly the nine Indian Ocean Littoral Countries (IOLC) in Africa.
- The IOLC nations in Africa are Comoros, Kenya, Madagascar, Mauritius, Mozambique, Seychelles, Somalia, South Africa, and Tanzania.
ii.The Indian Ocean continues to be important to both India and Africa in terms of security and trade since it serves as a vital shipping route for India.
- India and Africa also have strong maritime links based on the collaborative framework of “Security and Growth for All in the Region” (SAGAR).
iii.The Ministry of Defence (MOD) of the Indian Government has been developing collaboration within the framework of the Indian Ocean Rim Association (IORA) to implement specific projects.
- It has formalised defence cooperation frameworks with South Africa, Kenya, Tanzania, Mauritius, Seychelles, and Madagascar.
iv. India was the 23rd largest exporter of defence supplies from 2017 to 2021, citing the SIPRI (Stockholm International Peace Research Institute) International Arms Transfer Database Report.
v.In Africa, Mauritius received 6.6% of India’s arms exports during 2017 to 2021, followed by Mozambique (5%) and Seychelles (2.3%).
vi.The report also cited cyber security as another potential area for cooperation.
Indian Exim Bank Inks Pact with Southern Africa’s FirstRand Bank to Boost India-Africa Trade
The Export-Import Bank of India (India Exim Bank) and FirstRand Bank (FRB) Limited of South Africa have signed a “Master Risk Participation Agreement” to promote trade transactions.
- The agreement was signed on the occasion of the India-Southern Africa Regional Conclave in Johannesburg, South Africa.
It was signed in the presence of Mozambique’s Minister of Industry and Commerce, Silvino Augusto Jose Moreno, and India’s High Commissioner to South Africa, Jaideep Sarkar.
Significance
i.The agreement was signed as part of the Trade Assistance Programme, the latest trade facilitation initiative of the India Exim Bank.
ii.Under this initiative, the India Exim Bank provides credit enhancement to trade instruments, ultimately increasing the capacity of commercial banks and financial institutions.
- It enables them to conduct cross-border trade transactions involving markets where trade lines are limited or potential has not been discovered.
Key Points:
i.The agreement builds funding channels to facilitate trade between India and Africa, with the goal of bolstering India’s growing economic engagement with African nations.
ii.FRB has presence in Botswana, Eswatini, Ghana, Lesotho, Mozambique, Namibia, Nigeria, South Africa, Tanzania, and Zambia, as well as a representative office in India in Mumbai, Maharashtra.
Recent Related News:
In October 2022, Export-Import Bank of India (India Exim Bank), also known as EXIM Bank, has issued a Line of Credit (LOC) of USD 100 million to the Government of the Republic of the Maldives for the purpose of funding development projects on behalf of the Government of India (GoI).
About the Export-Import Bank of India (India Exim Bank):
Managing Director (MD) – Harsha Bangari
Establishment – 1982
Headquarters – Mumbai, Maharashtra
