Lessons for Latin America
A 2006 World Bank study by Harry Broadman, Africa’s Silk Road: China and India’s New Economic Frontier, which was based on a survey of Indian and Chinese firms operating in Africa, found that in contrast to China’s enclave-type, state enterprise-dominated corporate profiles with limited spillover effects, Indian firms have been better integrated into domestic markets. Moreover, unlike Chinese firms—which bring workers from China even for construction and other tasks when African countries have a severe unemployment problem—Indian firms overwhelmingly opt for Africans even for managerial positions.
African countries are being wooed by all the major economic powers, particularly for their minerals and energy resources, giving them leverage. Sustainable benefits to the average African citizen are, however, likely to be realized only when partnership involves strong domestic linkages; develops human resources; and assists in employing modern knowledge and technology to address developmental challenges, particularly in agriculture. If these criteria are applied, African countries will find Indian businesses to be appropriate developmental partners.