INDIAN AMBITION:India is engaging in a global race to invest in African land for crops, while building deeper links by backing infrastructural and industrial projects
ONCE THE jewel in Britain's colonial crown, India is fast becoming a coloniser as it acquires vast tracts of land across Africa to lucratively farm food crops for local consumption, for import back home and for export.
Backed by federal government loans, cheap credit and preferential import tariffs, some 80 private Indian companies have over the past two years acquired or leased thousands of hectares in Ethiopia, Kenya, Madagascar, Senegal and Mozambique's Zambezi Valley to grow rice, sugar cane, maize, pulses, oilseeds, tea and even flowers, vegetables and fruit.
Some Indian investors were cultivating the biofuel crop jatropha in West African countries as part of India's overall strategy of crop outsourcing, at great profit.
Indian agricultural experts said that unlike earlier, when governments and Tai pans colonised and acquired land for profit, the 21st-century impetus was driven by escalating shortages in emerging economies such as India and neighbouring China, where rising incomes were generating higher demands for food.
Currently, India's annual food grain production of 230 million tonnes is barely enough to meet local demand, but with its burgeoning population this requirement is likely to grow to 240-250 million tonnes by 2020-25.
However, adverse environmental changes triggered by global warming, rapidly shrinking land holdings and swift urbanisation of agricultural land has been adversely affecting output. This is expected to fall appreciably, necessitating supplementary supplies from alternate, overseas sources such as Africa.
Over half the $4.15 billion (€2.94 billion) in foreign direct investment by the government in New Delhi in turbulent Ethiopia in 2008 has aided numerous Indian conglomerates to invest in agriculture and floriculture in Africa's second most populous nation.
In early June, Bangalore-based Karuturi Global Ltd signed an agreement with Ethiopia to grow palm trees (for oil), rice and sugar cane on some 300,000 hectares of land. Flowers like roses and gladioli would be exported to EU countries, significantly boosting company profits. Karuturi's Gambella Agriculture Project, launched jointly by Ethiopia's agricultural minister Abera Dersea and Indian ambassador Gurjit Singh, is expected to provide direct and indirect employment to over 25,000 locals over the next three to five years.
"We are encouraging more Indian companies to enter into mainstream agriculture so that they can contribute to local demand and generate food security," Singh declared.
In January, India's Varun Agriculture SARL signed a deal with 13 landlords in Madagascar's Sofia region for 170,914 hectares to grow rice, corn, maize, wheat, pulses, fruits, vegetables and other local produce for domestic use, for import to India and export elsewhere.
Such proliferation has been questioned, with food policy experts charging the Indian government with practising "neo-colonialism" and of sponsoring "exploitative" deals with poor African states that would exacerbate their food insecurity, triggering civil strife.
"I call them 'food pirates' on a land grab spree," said Devinder Sharma of the Forum for Biotechnology and Food Security, based in a Delhi suburb. Africa's elite, he declared, were willing to compromise on national security as long as it brought them profits, cautioning that outsourcing of food production would mean starvation for ordinary Africans. "The environmental cost of intensive farming like exhausted soil from over-fertilisation and over-exploitation of water resources would be the liabilities left behind for the host country."
The Confederation of Indian Industry (CII), to the fore in facilitating India's burgeoning business partnership with Africa, believes the proliferating agricultural activity has been a positive "force multiplier" for indigenous corporate houses. It dismissed charges of India being an "exploiter" and "coloniser".
India, however, is one of the newer and more modest nations to engage in this latest bout of "colonialism". According to a report by the International Food Policy Research Institute (IFPRI) in Washington, 15-20 million hectares of land across Africa were recently sold for $20-$30 billion to a handful of investors from China and Gulf Sheikhdoms, both of which face worse land and water shortages than India.
India is also challenging China's growing economic influence across Africa by investing heavily in building up the continent's infrastructural, industrial and human resource capabilities in return for access to vast, untapped reserves of oil, gas and minerals.
India has in recent years developed close relations with the 53-member African Union and various regional organisations, not only by extending credit and expanding trade but also by building defence and military links.
India plans on doubling to $5.4 billion its credit line to African countries to kick-start several initiatives centred around augmenting food and energy security, trade, industry, financial services, employment, information technology, railways and the health and educational sectors. Annual bilateral trade between India and African states totals around $30 billion. This remains around half of China's trade of $56 billion with Africa - estimated to double to $100 billion by 2010.
India has identified Africa as part of its wider strategic interest and is concerned about China's encroachment on what it perceives to be its "wider sphere of influence" along the African rim of the Indian Ocean Region.
