India wants Africa

Indian Prime Minister Narendra Modi is touring Mozambique, South Africa, Kenya and Tanzania. He is in search of raw materials and diplomatic allies in its quest for a permanent seat on the UN Security Council. South Africa has already expressed support for a revamp of the Security Council. India and the African continent account for one-third of the global population yet they do not have a permanent Security Council seat.

Concerns about democracy and human rights are not even on the periphery of such trade deals. India's state-run ONGC owns oil fields in Sudan and evidently regards Africa as a market with growth potential. Sudanese President Omar al-Bashir is wanted by the International Criminal Court on charges of war crimes and crimes against humanity, but at last year's India-Africa summit he was given a cordial welcome.

Since he came to power in 2014, Modi has been overhauling Indian foreign policy and expanding trade ties. In October 2015, African nations attended an India-Africa summit he staged in New Delhi. Now, he is travelling to Africa himself, visiting the four major countries on the continent's eastern coastline.

India is forced to import more than two-thirds of the oil and gas it consumes and more than a quarter of that energy comes from Africa. After Australia and Qatar, Mozambique is India's third largest gas supplier.

Whereas India has invested just 7 billion euros in Africa since 2008, China poured 23 billion euros into Africa, in direct investment, in one single year (2013). The volume of trade Africa conducted with India last year amounted to just a third of its trade with China. That could change. Chinese economic growth is losing steam and the slow-down will have an impact on trade, perhaps opening up new opportunities for India. The Indian economy is also expected to grow more robustly than the Chinese economy in the medium and long term. The country is already South Africa's sixth most important trading partner. India has already made a name for itself in the IT sector in Africa. Many Africans use the Indian telecoms provider Airtel and the company has a firm foothold in the market in more than a dozen African countries. India would like to expand still further in this sector. Major Indian companies are also active in other areas of the economy. The Tata group has been in Africa since 1977 and is now represented in 11 countries with its automobiles, hotels and telecommunications companies.

The presence of minority Indian populations, in southern and East Africa in particular, is also seen as another advantage for India when deepening ties to Africa. Modi's tour includes meetings with the Indian Diaspora in all four countries. South Africa is home to 1.3 million people of Indian origin.

http://www.dw.com/en/indian-leader-on-african-tour/a-19385649

Another Land-grab Report

Indian agribusiness companies are ready to spend $2.5bn buying, or renting for decades, several million hectares of cheap land in Ethiopia, Tanzania and Uganda in what could be some of the largest farming deals struck in Africa in the last 50 years, according to a Guardian report.

A delegation of 35 Indian investors, including food conglomerates McLeod Russel, Kaveri Seeds, and Karuturi Global, has been touring Ethiopia, Tanzania and Uganda for the last week to seek land to grow palm oil, maize, cotton, rice and vegetables, largely for the burgeoning Indian market. The deals, if concluded, would swell growing concerns for the "land grab" phenomenon now taking place. There has been growing alarm at some of the handouts and tax exemptions in favour of the companies, potentially at the expense of local communities. Many of the projects have barely started producing food, but tens of thousands of people are expected to be evicted, and land traditionally used by pastoralist farmers is being fenced off. In addition, many companies are being allowed to grow food primarily for export despite increasingly hungry home markets.

Karuturi said in Dar es Salaam that it was ready to spend $500m acquiring and developing 200,000 hectares of land for palm oil, 150,000 for cereals and 20,000 for sugarcane. This is in addition to $400m the company is spending to develop 100,000 hectares in Gambella province in Ethiopia. The investors have said they are each ready to spend hundreds of millions of dollars on what is some of the cheapest land in the world, being offered on decades-long leases for as little as $1.50 per hectare per year.

"There is huge potential for the agriculture sector in east Africa," said Karuturi's managing director, Sai Ramakrishna Karuturi. "The region has 120m hectares of arable land, the same size of arable land India has."

According to the UN, at least 60m hectares of land, mostly in Africa , have been bought or leased for up to 100 years as western hedge and pension funds have moved to buy land as an alternative investment to property, and wealthy Middle East countries have sought land to grow food after food riots and droughts. China, Saudi Arabia and Egypt as well as many smaller Middle East countries have led the deals.

"No one should believe that these investors are there to feed starving Africans, create jobs or improve food security," said Obang Metho of Solidarity Movement for New Ethiopia. "These agreements – many of which could be in place for 99 years – do not mean progress for local people and will not lead to food in their stomachs. These deals lead only to dollars in the pockets of corrupt leaders and foreign investors."

Meanwhile, the same situation has manifested itself in South America where the US-based Council on Hemispheric Affairs, has concluded that much of Paraguay, Uruguay and Bolivia has been acquired by foreign companies to farm."In Paraguay, Argentine firms and individuals own about 60% of the 3m hectares of land used to cultivate soy. Foreigners own 19.4% of all Paraguayan land and Argentines own almost all of the 500,000 hectares of Uruguayan soil designated for soy cultivation, while foreigners own 25% of the country's total arable land," say the authors. Foreign agribusiness investors own or rent over 1m hectares of Bolivia, according to the report.