Visit Signals India’s Deepening Bet on Africa’s Growth and Global South Influence
Kemi Osukoya | AFRICA BAZAAR MAGAZINE
Indian Prime Minister Narendra Modi is set to make his first official visit to Ethiopia this week as part of a three-nation, five-day tour spanning the Middle East and Africa—an itinerary that underscores India’s expanding geopolitical and economic footprint across the Global South.
The tour, running December 15–18, begins in Jordan, continues to Ethiopia, and concludes in Oman, blending diplomacy, diaspora engagement, and strategic commerce at a moment when emerging economies are redefining global power alignments.
AFFILIATE PARTNER
Prime Minister Modi’s visit to Ethiopia builds on a sustained push by New Delhi to deepen its economic and strategic footprint across Africa. This year alone, India has stepped up high-level engagement with East, Southern, and Gulf-linked African economies, including a historic visit to Ghana in July aimed at expanding bilateral trade, defense cooperation, and development partnerships. India has also strengthened ties with Namibia, Nigeria, South Africa, and Mauritius, reinforcing a broader strategy that targets fast-growing consumer markets, emerging manufacturing hubs, and critical resource supply chains. Earlier visits to Mozambique, Tanzania, Kenya in 2016, and South Africa laid the groundwork for this renewed Africa focus.
In Ghana, India signed a cultural exchange program covering art, music, literature, and heritage, alongside agreements on product standards and certification and collaboration in traditional medicine, education, and research. New Delhi has set an ambitious goal to double bilateral trade with Accra over the next five years and is backing Ghana’s aspiration to become a regional vaccine manufacturing hub, signaling a shift toward higher-value, health-focused industrial cooperation.
In Namibia, India concluded agreements to establish an entrepreneurship development center to support startups and skills training, expand cooperation in health and medicine, and strengthen disaster resilience and infrastructure. Namibia has also adopted India’s digital payments platform, UPI, under a new digital licensing arrangement and joined India-backed global initiatives such as the Coalition for Disaster Resilient Infrastructure and the Global Biofuel Alliance. In Mauritius, India has advanced cooperation in maritime security, ocean governance, and trade settlement in national currencies—further illustrating how New Delhi is pairing diplomacy with concrete commercial and financial mechanisms across Africa.
Why Ethiopia Matters to India—and BRICS
Ethiopia, which is emerging from years of conflict and economic restructuring, occupies a unique position in India’s Africa calculus. It is home to the African Union headquartered, has one of the continent’s largest populations, and an increasingly important manufacturing base for textiles, agro-processing, and light industry.
According to the International Monetary Fund‘s latest report, Ethiopia’s Homegrown Economic Reform agenda has begun to pay dividends, driving stronger macroeconomic growth since mid-2024, exports have doubled, inflation has eased, revenues have surged, and debt restructuring talks continues with bilateral creditors under the G20 framework advance toward restoring long-term fiscal sustainability.
For Ethiopia, Modi’s visit represents more than symbolism. It strengthens South–South cooperation, deepens engagement with BRICS financial institutions as well as the G20 Alliance, and opens doors to co-financing for infrastructure, energy, and industrial projects backed by Indian capital and expertise.
For India, who is a member of the G20, Ethiopia offers a strategic manufacturing base, access to African markets, and a platform for shaping multilateral trade rules within BRICS. Talks are expected to focus on streamlining trade in textiles, agricultural products, and minerals, alongside expanded Indian investment in agro-processing, textiles, and light manufacturing.
During the visit, Modi is expected to address a joint session of Ethiopia’s parliament, framing India’s democratic and economic trajectory as a model of South-South cooperation. Bilateral talks with Prime Minister Abiy Ahmed Ali are expected to focus on trade, industrial investment, defense cooperation, and development finance.
Diplomatic relations between India and Ethiopia date back to the late 1940s, but ties have broadened significantly in recent years. In 2025, the two countries signed a defense cooperation framework covering cybersecurity, industrial collaboration, and research and development—an expansion beyond traditional economic ties.
A Growing Global Commercial Footprint
India’s private-sector presence in Ethiopia is already sizable. Roughly 650 Indian companies operate in the country, with cumulative investments exceeding $3 billion across textiles, manufacturing, agriculture, healthcare, and engineering. These firms collectively employ tens of thousands of Ethiopians.
Bilateral trade reached about $550 million in 2023–24. India exports pharmaceuticals, machinery, steel products, and chemicals, while Ethiopia supplies agricultural commodities, leather goods, and precious stones.
For investors, Ethiopia offers relatively low labor costs, preferential access to Western markets, and growing regional connectivity. For India, it provides a base for export-oriented manufacturing and a strategic entry point into East and Central Africa.
Analysts say Ethiopia’s accession to BRICS also adds a multilateral dimension to the visit. India, a key architect of the bloc and a major contributor to the New Development Bank, is positioned to support infrastructure, energy, and industrial projects through blended financing structures.
Indian officials have signaled interests in expanding investment in agro-processing, textiles, pharmaceuticals, and manufacturing—sectors aligned with Ethiopia’s industrialization agenda. For global investors, this opens co-investment opportunities alongside Indian firms, particularly in export-oriented production and infrastructure development.
Part of a Broader Africa Strategic Push
As emerging markets seek new growth engines and diversified supply chains, Modi is positioning India as an alternative partner to China and Western donors—emphasizing private-sector investment, development finance, and technology transfer rather than large sovereign lending. Ethiopia’s alignment with India may offer investors a window into Africa’s next phase of industrial expansion.
Experts say it’s a win-win opportunity for multinational investors and corporations. India’s deepening involvement in Ethiopia not only suggests that Addis Ababa will play a larger role in India’s long-term Africa strategy—one that links manufacturing, trade, and geopolitics across the Global South, it signals increased policy attention, capital flows, and risk-mitigation mechanisms in one of Africa’s most strategically important markets.
Indian firms’ growing footprint may also catalyze improvements in industrial ecosystems, logistics, and skills development, given both countries tech-oriented industry, experts suggests.
