DELHI - BY ASIA INSIDER - Oct 17,2023

In the complex world of geopolitics, rare earth elements (REEs) have emerged as pivotal players, gaining strategic significance, particularly for countries like India with a thriving technology sector. India recently revealed a list of 30 critical minerals essential for national security, reflecting its commitment to establishing a domestic semiconductor manufacturing plant. However, India's challenge lies in the overwhelming dominance of China, which controls over 80-90% of the global REE market, leaving India heavily reliant on its eastern neighbor.

 

Africa, on the other hand, possesses vast untapped REE reserves, particularly in countries like Burundi and Tanzania. Unfortunately, these resources have remained largely underexplored due to lack of technology and investment. China has recognized this opportunity and is actively extending its influence in Africa's REE sector. However, China's approach often involves debt-trap diplomacy, which can lead economically vulnerable nations into long-term financial burdens.

 

In contrast, India has consistently pursued a non-extractive and sustainable approach in its engagements. India's External Affairs Minister, S. Jaishankar, recently reaffirmed its non-expansionist and inclusive approach towards Africa, positioning India as a preferred partner for the continent.

 

One often overlooked aspect of India's connection with Africa is its vibrant Indian diaspora, consisting of over 3 million individuals. Integrated into Africa's social and economic fabric, this diaspora has proven its capabilities in trade, manufacturing, and services. Leveraging this network and its understanding of local contexts could serve as a catalyst for India's increased engagement in Africa's REE sector.

 

History has shown that diasporas can significantly contribute to their home countries' economic prosperity and security. For example, the Chinese diaspora has been instrumental in driving China's investments in Southeast Asia, and the Jewish diaspora contributes billions annually to Israel. Similarly, India's diaspora in Africa has the potential to contribute significantly to India's REE interests.

 

However, India's outreach to its African diaspora has been limited thus far and requires strategic revitalization. Recent discussions between India's Minister for Commerce and Industry, Piyush Goyal, and ambassadors from 15 African nations indicate a promising shift. To tap into the potential of its diaspora, India needs to incentivize them with concrete benefits such as tax breaks, low-interest loans, and investment guarantees. 

 

Establishing a bilateral business council to facilitate investment in the REE sector and negotiating agreements with African governments to provide support to Indian businesses exploring the mining sector are crucial steps.

 

Beyond financial incentives, India should also focus on soft power initiatives to strengthen cultural bonds and mutual understanding. Cultural exchanges, educational collaborations, and research partnerships with African nations will lay the foundation for a sustainable, long-term strategic relationship.

 

India's Africa policy is evolving, but a more robust, diaspora-centric strategy is essential. Leveraging the Indian diaspora in Africa not only secures India's strategic interests in the global REE landscape but also offers a sustainable alternative to China's expansionist tactics. By nurturing relationships that promote inclusive growth and job creation, India can establish itself as a reliable partner to Africa.

 

In conclusion, India must reshape its Africa policy strategically. The Indian diaspora in Africa represents more than just a demographic statistic; it is a valuable strategic asset. By tapping into this resource, India can unlock new opportunities for engagement in Africa's REE sector, fostering economic prosperity, job creation, and strategic security for both India and Africa.