India plans to invest $200 billion in Africa by 2030
As India’s bilateral trade with Africa surged to almost $100 billion by the end of the fiscal year in March 2023, there are indications that the Indian government plans to increase it to $200 billion by 2030, the Export-Import Bank of India (EXIMBANK) has said.
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The state-owned EXIMBANK plays a major role in providing export financing and government-directed lending to other countries.
Currently, it supports over 300 small Indian companies to expand business in African countries and plans to raise between $3-$3.5 billion of funds in the current financial year, (mostly denominated in US dollars,) to finance new projects.
“The bank is also looking at stepping up investments through government-supported lines of credit to assist Indian companies to finance their projects across Africa, the Managing Director of the EXIMBANK, Harsha Bangari,” said.
Analysts say this is coming at the back of increased competition from China for African markets and Bangari said, "Africa is becoming a big consuming continent and Indian companies have huge potential to find a market."
“We are seeing a consistent and steady trend, in increasing lines of credit and trade finance,” she said, adding, “EXIM Bank has so far made a credit commitment of $12.8 billion to 42 African countries.”
“EXIM Bank has engaged various African governments as part of India's economic diplomacy, including a metro train project in Mauritius, exports of buses from India to Senegal, and an electricity project in The Gambia,” Bangari said.
"We have identified sustainable fuels and minerals for transport, renewable and clean energy and climate-smart agriculture, among other areas, for supporting lending to the African countries," she added.
Investment
In Ghana, as Indian investment continues to grow, one man, Mukesh Thakwani, the Chief Executive officer of leading steel producers, B5Plus Limited, has come to stand out as an investor with a purpose.
What makes his story in Ghana exceptional is that Thakwani, who had a business in Liberia, arrived in Ghana in transit, with no intention of staying, but said he fell in love with the country and the people and so decided to stay.
That chance of entry into Ghana has come to add to the number of Indian businesses in Ghana.
According to the Indian Department of Commerce, the exchange of business delegations in recent years has led to an increase in investments by Indian companies in Ghana.
“A number of Indian companies, including Tata, Ashok Leyland, Mahindra & Mahindra, Escorts, Larson & Toubro, NIIT, Shapoorji Pallonji, as well as several pharmaceutical companies, have established their presence in Ghana,” the Department of Commerce said.
The Ghana Investment Promotion Centre (GIPC) said as of last year, Indian companies had invested in 870 projects with a total investment of $2.22 billion between 1994 and 2021.
From January to December 2021, India’s FDI was $93.84 million in 25 projects, i.e., 7.21 per cent of Ghana’s total FDI of US$ 1.3 billion in 271 projects.
Explaining his entry into the country, Thakwani, who is from Gujarat, India, said, “I didn’t plan to start a business in Ghana when I arrived in Accra in 1996 on transit from Liberia.”
But 27 years later, his company is producing over 400,000 tonnes of steel a year and employing thousands of Ghanaians.
On this particular visit, Thakwani said he met his uncle who had a business in Ghana and for some reason, he took the decision to work for him for a while.
Later, he decided to stay and then decided to grow a business to produce steel products.
In 2002, Thakwani decided to set up his own company.
“We started on this very ground where B5Plus is today.
It was all bush.
When I called a friend to tell him I was building a steel factory, he asked me who would come to buy steel from the bush.
No one used to come around here after 5 p.m.
I remember I had to come here to cut the bush with a friend and my driver,” he said.
The company that started producing only 200 tonnes of nails was able to win over the market as their products became popular on the market because of their price.
So, they decided to move into manufacturing galvanised products and later iron rods.
Thakwani said, “Today, we are very proud to say that B5Plus is producing 400,000 tonnes of steel a year.
In addition to this, we have moved into other types of steel production in Ghana, which we export to other West African countries.”
Since its inception, B5Plus Limited has won over 100 national awards, but Thakwani said, one of the awards “ dear to me is the recognition by Ministry of Health’s Certificate of Appreciation to B5 Plus Limited, this year, for the company’s contribution in donating oxygen to various health facilities to avert crisis during the COVID – 19 pandemic”.
Experience
Though his entry into Ghana was by chance, he is an avid and astute businessman, with a rich experience of 25 years in the steel industry in the African business landscape.
The long stay in West African countries, such as Liberia, Togo, Free Town and Benin, since 1988 has helped Thakwani to acquire an incredible business expertise.
It is not only steel that he is producing in Ghana.
He has also started a school, the Delhi Public School (DPS) near Tema, in Accra.
The DPS is an offshoot of the one in India, which was set up in 1949 and now has 150 branches, the bulk of them in India and 13 in 10 foreign countries.
He said DPS was started because education was very dear to his family.
“We always believe that giving education is important.
If one person is given an education, he can help support 10 people in his family.
We realised that in Tema there was a great need for quality education, and we also wanted to create future leaders,” he added.
The school opened its doors in 2010 with 23 students and Thakwani said though manufacturing steel was what he started with, he also had the desire to build a top-class school where the fees would be affordable to all but with the same high level of teaching.
The school was planned to be available to people from diverse backgrounds.
"DPS Ghana is growing to be different from similar schools in West Africa because of the high quality of facilities available, which are not found in other schools in the region, in addition to the fact that the school opened its doors to all because of its affordability.
“I am proud to say that since 2010 to date, we have shown by good academic records and awards won by our students that we have made a great impact,” Thakwani added.
He strongly believes in the philosophy of Aristotle, “Education is an ornament in prosperity and a refuge in adversity” and that explains his passion for developing educational facilities in the country.
Award
The Duke of Edinburgh’s International Awards Association has honoured Thakwani for his generous contribution towards the socio-economic development of the country.
He is not only a successful entrepreneur but also a polymath who has a deep insight into the realm of education.
He is a true educationist who envisaged building the capacities of the spirit of inquiry and creative, entrepreneurial and moral leadership among students and has become their role model.
His focus is making DPS carve a niche for itself on the map of West Africa.
In addition to his business achievements, he is also a philanthropist and supports many NGOs that are working for the cause of education and health in Ghana.
He has certification from the prestigious Harvard Business School where he successfully passed the owner/president management programme- 51.
Since 2016, he has been a member of the Young President’s Organisation (YPO).