Africa’s abundance of natural resources and its multitude of investment opportunities have made it extremely attractive for the rapidly growing national economies of China and India to invest in this continent. As of now, both these ‘’Asian Tigers’’ have vested economic and political interests in various African countries. With the concurrent Chinese and Indian economic engagements in Africa, one may wonder whether this will lead to either mutually beneficial cooperation between the two powers or result in economic tension and consequent heated political conflicts. In order to assess the nature of the Sino-Indian competition, it is necessary to look at the radically different economic strategies that China and India have employed with regards to Africa.

Image courtesy of Simeon Scott, © 2005, some rights reserved.

Image courtesy of Simeon Scott, © 2005, some rights reserved.

China’s and India’s economic engagement in Africa stems from their continuous need for accessible resources which are abundant in Africa. In addition, with a total population of approximately 900 million people and relatively unexplored economic possibilities, the continent provides ample investment opportunities for both states. Already, trade between China and Africa has multiplied six-fold: growing from $20 billion in 2001 to $120 billion in 2009. Similarly, trade between India and Africa has risen from $9.9 billion in 2004-05 to $39.5 in 2008-09.[1] Presently, India’s trade comprises $65 billion and China’s comprises $200 billion.[2] Hence, both these economic superpowers have substantial investments in the African continent.

Whilst both China and India are competing for the same ends in Africa – natural resources and investment options – their economic strategies are considerably different.

First of all, whereas China focuses mainly on infrastructure development in return for access to natural resources, India has attempted to be active beyond this in industries such as the information and telecommunication technology, education, and health services.[3] Chinese firms are currently building bridges, roads, airports, and other infrastructural projects. Take, for instance, the recently completed Kenyan eight-lane Thika Superhighway, which was built with assistance of the Chinese and has become Kenya’s national pride.

In addition, the Chinese corporations active in African states are mostly government-owned, which gives them an edge over the Indian firms because they have the financial and political support of the government behind them.[4] The Indian companies, on the other hand, are mainly privately owned and therefore do not enjoy the same level of financial and political support from their government. Even though the Indian government has recently increased its support for the Indian enterprises in Africa, it is not capable to provide the same level of financial support as China has in virtue of having fewer available capital reserves.

A final difference is that China’s approach is more short-term in the sense that it aims to reap the benefits of the available natural resources in exchange for their assistance in developing cheap and fast infrastructure. The Indians are more interested in long-term economic forms of cooperation that are mutually beneficial to India as well as the relevant African country. Just like almost all African nations, India has been subjected to colonisation and it does not wish to replicate this imperial system by blatantly exploiting Africa’s resources.[5] This economic strategy has proven to be successful in countries like South Sudan, where Indian companies have been given full control over the local oil and gas industry. India has also made its mark in Zimbabwe through its increasing prominence in the local energy industry. Hence, whereas the Chinese corporations provide African countries with cheap and fast economic projects, the Indian firms attempt to be more invested by creating long-term, mutually beneficial economic partnerships. By analogy, China is giving Africa many fish (cheaply and fast) while India teaches Africa how to catch a fish so that it can provide for itself in the long-term. China offers African leaders a good price for their resources, but African states seem to start preferring the Indian model of economic cooperation, which provides the Africans themselves with better technologies and skills. Regardless of which of the two Asian powers African countries prefer to collaborate with, they have been positive about the economic partnerships on the whole, since the high demand has greatly increased their returns on commodity exports.

Although there has been some historical animosity between Indian and China in the past (their border dispute in 1962 for example), this is no reason to think that their competition in Africa will turn sour any time soon. It is completely normal for rising economic superpowers to experience some direct rivalry. The two Asian giants are invested in often completely different industries in different African countries and therefore experience little to no overlap of economic interests. Additionally, because Chinese firms present on the continent are backed up financially and politically by their government, this places them at an advantage in relation to Indian corporations. While this increases their potential to offer cheaper and faster services, it does not mean that all African states are equally keen for the Chinese model as collaboration with India may more beneficial in the long-term. In essence, China and India both have their niches as each African state will have its own specific industry demands and preference for a certain model of economic collaboration.

Moreover, China and India are highly unlikely to engage in the same ‘zero-sum competition’ that existed between the United States and the Soviet Union during the Cold War in their battle for global influence, because their economic interests are significantly more intertwined. Political conflict between the two powers would only serve to endanger their vested interests in Africa and harm their own bilateral economic relationship. In addition, regional forums like the East Asia Summit, which were far rarer during the Cold War period, ought to diminish the likelihood of economic tensions by creating a common platform for discussion. It is safe to say that the chance of heated political conflicts between China and India regarding Africa seems to be out of the question for now. There has even been evidence of Sino-Indian cooperation in recent years in African regions where it has been favourable for both states to combine their financial capabilities and expertise. A prime example of this is the economic partnership between China and India starting in 2004 in the Greater Nile Oil Project in South Sudan, linking the country’s inland oil fields to refineries along the Nile and the eastern coast.

After having examined the nature of the Sino-Indian competition for Africa as well as the two countries’ different economic approaches, it appears that an economically tense and politically conflictual situation is unlikely to arise any time in the near future. Since China and India are involved in different industries and employ a radically different model of cooperation with the African states, their economic interests do not clash. Frequent international and regional economic forums surrounding this topic will serve to diminish the likelihood of conflict and even provide a platform for occasional cooperation between the two Asian powers. Of course, these conclusive remarks are rather speculative as the political debate on the Sino-Indian competition in Africa is fairly recent. Hopefully the economic competition between the Chinese Dragon and the Indian Elephant remains friendly and does not turn into a political clash of the two Asian Tigers.



[1] F. Cheru and C. Obi, ‘’Chinese and Indian Engagement in Africa: Competitive or Mutually Reinforcing Strategies?’’, Journal of International Affairs, Vol. 64, No. 2 (2011).

[2] V. Khare, ‘’China and India: The Scramble for business in Africa’’, BBC News, (5 August 2013), accessed at http://www.bbc.co.uk/news/business-23225998.

[3] ‘’Strategic competition between China and India in Africa’’, Stratsis Incite, (5 August 2010), accessed at http://stratsisincite.wordpress.com/2010/08/05/strategic-competition-between-china-and-india-in-africa/.

[4] B. Ghoshal, ‘’Understanding The Sino-Indian Competition in Africa – Analysis’’, IPCS, (28 June 2011).

[5] ‘’The clash of two tigers: Understanding the Sino-Indian competition in Africa’’, Connecter Le Monde, (22 April 2013), accessed at http://www.connecterlemonde.com/the-clash-of-two-tigers-understanding-sino-indian-competition-in-africa.