In Africa, India’s soft power abuts Chinese money

China’s President Xi Jinping on Monday announced a $60 billion fund for Africa.

Published: 05th September 2018 04:00 AM  |   Last Updated: 05th September 2018 01:06 AM   |  A+A-

China’s President Xi Jinping on Monday announced a $60 billion fund for Africa. Addressing the inaugural session of the 3rd Forum on China-Africa Cooperation in Beijing, attended by nearly every African nation, Xi said the funds would be used “to boost industry, counter hunger and enhance security”.

Perhaps in a nod to increasing concerns about China co-opting or coercing nations through a debt trap, whereby Beijing gives substantial loans to poor nations and then extracts political and strategic mileage when these countries struggle to repay, Xi said $15 billion of the $60 billion on offer would be disbursed as aid or interest-free and/or concessional loans.

To sweeten the deal, he also said China would encourage settlements in local currency. China already has large investments in Africa, and in return has mining and exploration rights in several nations in the resource-rich continent. It also has its first overseas military base in Djibouti.

India too has been wooing Africa aggressively, but is aware that it cannot compete with China’s economic largesse. New Delhi has taken the route of cultural and people-to-people connections and offering human resources development.

It has also launched initiatives like the International Solar Alliance, which aims to empower smaller nations in need of electricity, and funds infrastructural and agricultural projects. Chinese newspapers point out that while Xi is pushing for new free trade zones in Africa, PM Modi is seen donating 200 cows to Rwanda in a symbolic gesture towards President Kagame’s rural development scheme during his recent African tour. Similarly, while China has set up a military base in Djibouti, India trains bureaucrats, police and military officials from several African nations.

As Tanzanian PM Kassim Majaliwa put it, “India may not be building all the hospitals in Africa, like China is, but it is training all the doctors and nurses in the continent.” For now, Africa can have its cake and eat it too. But it will be interesting to see what happens when China starts calling in its debts.


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