India Plans $5 Billion Credit Line Over 3 Years for Africa for Development
India will provide a $5 billion line of credit to African nations over the next three years to help fund economic development on the continent, Prime Minister Manmohan Singh said.
“Africa possesses all the pre-requisites to become a major growth pole in the world,” Singh said in a speech at the opening of the India-Africa Forum Summit in Addis Ababa, the Ethiopian capital, today. “We will work with Africa to enable it to realize its potential.”
India is boosting economic ties with Africa amid competition from China, its regional rival, whose trade with the continent totalled $106.8 billion in 2008, according to Consultancy Africa Intelligence’s website. Trade between India and Africa currently stands at $50 billion, African Union Commission Chairman Jean Ping said today.
In addition to the line of credit, $700 million will be provided for training programs and new institutions on the continent in consultation with the African Union, Singh said.
Indian External Affairs Minister S.M. Krishna and Ping yesterday signed agreements for four new institutions to be established. Ghana will host an information-technology organization; an institute of educational planning will be set up in Burundi; Uganda will get a foreign trade body and a diamond institute will be established in Botswana, the 53-member continental bloc said in an e-mailed statement today.
Weather Forecasting
Trade-promotion bodies including an India-Africa business council, food processing and textile clusters and a medium-range weather-forecasting center are also planned, Singh said.
India will provide $300 million to help rehabilitate the Djibouti-Ethiopia railroad, a project that began in 2004. Work on the European Union-funded upgrade so far has cost 50 million euros ($70.4 million), the EU Delegation to Ethiopia said in December.
“Under the lines of credit that we offered at the first summit, we had specifically looked at promoting regional integration through infrastructure development,” Singh said. “On the advice of the African Union, we will support the development of the new Ethio-Djibouti railway line.”
The summit that began today is the first since the India- Africa summit in April 2008.
The South Asian country will also provide $2 million to support the African Union peacekeeping mission in Somalia, Singh said. Somalia has been wracked by civil war and hasn’t had a functioning central administration since Mohamed Siad Barre, the former dictator, was ousted in 1991.
To contact the reporter on this story: William Davison in Addis Ababa via Nairobi at pmrichardson@bloomberg.net.
To contact the editor responsible for this story: Paul Richardson at pmrichardson@bloomberg.net.
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