Daily Editorial Analysis

Leverage Similarity and Complementarity Between India and Nigeria (GS Paper 2, IR)

Context

• India's relationship with Nigeria, a key African nation, holds significant potential but has seen stagnancy in recent years.
• Prime Minister Narendra Modi's visit to Nigeria on November 16-17, 2024, offers an opportunity to rejuvenate this strategic partnership.
• While India’s presence in Nigeria is visible through numerous businesses and bilateral ties, much of the potential remains untapped. This visit could be a defining moment in enhancing cooperation by focusing on the similarities and complementarities between the two nations.

 

Shared Challenges and Complementarities

Common Ground:

India and Nigeria share several challenges as well as strengths that can drive deeper collaboration:

• Governance and Socio-Economic Development: Both countries face similar developmental hurdles, including governance issues, socio-economic inequality, and the fight against corruption.
• Terrorism and Security Concerns: Both nations grapple with threats from terrorist organizations. While Nigeria faces challenges like Boko Haram and piracy in the Gulf of Guinea, India too has fought insurgencies and terrorism on its borders.
• Diverse, Multi-Ethnic Societies: Both are large, multi-ethnic democracies, each with significant religious and cultural diversity.

Complementary Areas for Cooperation:

• Hydrocarbons: Nigeria is a major oil supplier, while India is one of the largest consumers of crude oil. Despite this, India has limited upstream assets in Nigeria, which presents a huge opportunity for further investment and collaboration in oil exploration and refining.
• Defence: Both nations need to address similar security challenges. India’s experience in tackling insurgency, terrorism, and border management could be valuable to Nigeria, especially as it seeks to strengthen its armed forces.
• Institution Building: Both countries are still in the process of strengthening their democratic institutions, governance frameworks, and infrastructure.
• Health and Education: India’s leadership in health care services, pharmaceuticals, and education could be leveraged to support Nigeria’s growing demand for these sectors.

 

Current State of Bilateral Relations:

Economic Landscape:

• Indian Presence: India is a significant player in Nigeria’s economy with over 150 Indian companies investing around $27 billion. Indian companies like Airtel, Bajaj, Cipla, TVS, and Tata are well-established in Nigeria, contributing to sectors such as telecommunications, automobiles, pharmaceuticals, and infrastructure.
• Bilateral Trade: Trade between the two countries stands at $7.9 billion, with India being Nigeria’s second-largest trading partner. However, this is half the trade volume from a decade ago when India was Nigeria’s largest trading partner.

Decline in Relations:

• Trade Decline: While India is the top buyer of Nigerian crude oil, it has no upstream assets in Nigeria, which limits the long-term sustainability of this relationship. Additionally, India’s exports to Nigeria have declined, with a 29.7% drop in 2023-24.
• Political and Diplomatic Engagement: The last bilateral joint commission meeting took place 13 years ago, and Prime Minister Modi’s visit is the first in 17 years. There is a significant gap in high-level diplomatic exchanges that has contributed to the stagnation of the relationship.

 

Why Relations Have Stagnated:

• Lack of Comprehensive Framework: The absence of a well-structured framework for bilateral engagement has led to missed opportunities. This lack of frequent contact and strategic partnerships has prevented the countries from realizing their full potential.
• Underutilization of the Indian Diaspora: The nearly 50,000-strong Indian community in Nigeria, which is the largest non-African group in the country, could play a more active role in fostering bilateral relations. Their expertise and professionalism should be better leveraged for economic and social initiatives.
• Infrequent High-Level Engagement: There has been insufficient political engagement at the top level, with long gaps between visits and bilateral dialogues.

 

Nigeria's Current Economic and Political Challenges:

• Economic Difficulties: Nigeria, under President Bola Tinubu, is undergoing significant reforms to address long-standing economic issues. These include the removal of petroleum subsidies, the liberalization of the currency (the Naira), and tackling corruption. However, these measures have caused inflation, public discontent, and economic turbulence.
• Security Issues: Nigeria faces severe security challenges, including Boko Haram insurgencies, piracy in the Gulf of Guinea, and instability in neighboring regions. The country needs assistance in modernizing its defence infrastructure and addressing these threats.

 

Where India Can Help Nigeria:

India can assist Nigeria in several key areas:

Security and Defence:

• • India’s experience in counter-terrorism, border security, and military training can be invaluable to Nigeria, especially in strengthening its armed forces and improving internal security.
  • Joint defence cooperation, such as training Nigerian personnel in Indian institutions, could also be expanded.

Economic Stabilization:

• • India can help Nigeria stabilize its economy through strategic partnerships in the hydrocarbons sector (upstream investments), infrastructure projects, and financial aid through lines of credit.
  • A comprehensive Bilateral Comprehensive Economic Partnership Agreement (CEPA) can be explored to facilitate easier trade, reduce tariff barriers, and enable better market access for both countries.

Agriculture and Infrastructure:

• • India’s expertise in agricultural technology, including sustainable farming techniques and agricultural inputs, could help Nigeria address its food security challenges.
  • India’s experience in infrastructure development, especially in power, energy, and urban planning, could be tapped to address Nigeria’s infrastructure deficit.

Health and Education:

• • With India’s world-class pharmaceutical industry and expertise in medical treatment, Nigeria could benefit from increased medical cooperation, as Nigerians already travel to India for medical care.
  • Education exchanges, including scholarships, and capacity building in technical and vocational training can also be a vital area of collaboration.

Services Exports:

• • India’s services sector, particularly in IT, education, finance, and health, can help Nigeria improve its service delivery in these critical sectors.

 

Conclusion: A Shared History and Future Potential

• India and Nigeria have a rich history of cooperation dating back to the 16th century, with the arrival of Baba Ghor, a gem merchant from Kano, in Gujarat.
• This early connection serves as a reminder of the long-standing ties between the two nations.
• In today’s context, leveraging the similarities and complementarities between India and Nigeria can lead to a more dynamic and prosperous bilateral relationship.
• The Prime Minister’s visit to Nigeria offers an opportunity to reset and rejuvenate this partnership, enhancing cooperation in areas such as defence, hydrocarbons, infrastructure, and health.
• By addressing the current stagnancy and setting a forward-looking agenda, India and Nigeria can build a strategic, long-term partnership that benefits both countries.