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India vies with China for influence in Africa

Indian Prime Minister Manmohan Singh (L) and Chief of India's ruling Congress party Sonia Gandhi hold up a recently released book titled "Report To The People 2010-11" by the government of United Progressive Alliance (UPA) in New Delhi May 22, 2011.

B Mathur/Reuters/B Mathur/Reuters

The latest global scramble for Africa, with China now in the lead, is escalating to new heights this week as India sends a planeload of gift-bearing political leaders to Africa in an effort to compete with Beijing's fast-growing influence.

It would have been unthinkable a decade ago, but China and India are now emerging as key players in the African game, and both are boosting their presence so swiftly that they are becoming major competitors of the Western nations that traditionally dominated the continent.

Indian Prime Minister Manmohan Singh, accompanied by dozens of business executives and cabinet ministers, is arriving in Ethiopia this week for an Africa-India summit on a scale rivalling China's recent summits with African leaders.

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India has watched enviously as Beijing dramatically expanded its trade and investment in Africa in recent years. China's trade with Africa was a mere $2-billion in 1999, but it has soared to a stunning $110-billion annually, putting it ahead of almost any Western trading partner on the continent. China has also expanded its financial investment in Africa, bolstered its political and diplomatic influence, built roads and hospitals as foreign aid for Africa, and grabbed access to African oil and mineral resources.

India has lagged far behind, but now it is beginning to close the gap. Its trade with Africa has risen sharply, from just $3-billion a decade ago to a record $46-billion last year. New Delhi is aiming for $70-billion in trade by 2015.

At the Africa-India summit, which begins on Tuesday in Addis Ababa, the Indian politicians will reportedly offer a range of goodies: $500-million in new credit; 15 vocational training centres in various African countries; two coal institutes in Mozambique; a diamond institute in Botswana; skills training for 20,000 Africans over five years, and several regional "centres of excellence" focusing on subjects such as foreign trade and information technology.

Fifteen African leaders are expected to attend the summit with India. On the eve of the summit, India has also organized an "India Show" in Addis Ababa, including a trade exhibition, business discussions and cultural programs.

But if the Indian leaders need any reminder of the growing power of their rival, they only need glance across the street. Just outside the African Union headquarters, where the summit is taking place, China is building a gleaming new $150-million expansion for the African Union, including an impressive 30-storey tower - and the project is being entirely financed by Beijing. It shows how China remains far ahead in the race for influence here.

"Although India sees China as a competitor in Africa, it has to date lacked the resources and infrastructure to compete directly," wrote Alex Vines, an Africa expert at the Chatham House think-tank in London, in a recent study of the issue.

"India's concern over Chinese expansion is acute and ever-present," he added. "Its anxieties are not restricted to economic competition, but extend to security matters as well."

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He noted that India has signed defence agreements with several African nations along the Indian Ocean, including Mozambique, Madagascar and the Seychelles. India is also seeking a long-term lease on a group of small islands belonging to Mauritius, so that it can establish a base to protect its energy imports from Africa.

On the economic front, India has massively increased its oil imports from Africa - primarily from Nigeria, Sudan and Angola - as a way to reduce its dependence on Middle Eastern oil. India is importing minerals from the continent, including gold from South Africa and coal from Mozambique. And the Indian diamond-cutting industry, the biggest in the world, is fuelled by fast-growing diamond imports from South Africa, Botswana, Namibia and Zimbabwe.

India's investment in Africa, meanwhile, is increasing rapidly. One of its biggest companies, the Tata group, has invested in nearly a dozen African countries. And the Indian mobile phone company, Bharti Airtel, spent $9-billion last year to acquire the African operations of Zain, which provides mobile phone services in 15 African countries.

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