India Inc makes inroads in heart of Africa

1 March 2004
The Times of India

India Inc makes inroads in heart of Africa

SIDDHARTH VARADARAJAN
TIMES NEWS NETWORK

NEW DELHI: When the government of Madagascar, the former French island colony off the south-east coast of Africa, started scouting around for help to revive its ageing Solima refinery a few years ago, it, naturally, approached Paris.

All it heard, however, was 'Non monsieurs, c'est impossible. If you want a refinery, you'd better buy a new one'.

The World Bank's technical experts, too, went through the rusting plant and declared Solima a lost cause. Just when the government-owned company was about to give up, an oilman who had once worked with Indian engineers in the Gulf suggested a call be placed to India.

The rest, as they say in Francophone Africa, is l'histoire.

Experts from the public sector energy consortium Petroleum India International (PII) travelled to Madagascar on a recce of the sick refinery and concluded it was workable.

Today, the PII's effort at Solima is considered a benchmark in the turnaround maintenance of refineries. The Indian consortium helps run the plant, and has extended its hold on the Madagascar energy market by installing a state-of-the-art LPG bottling plant there.

Better still, Indian majors are well placed to make inroads in traditional oil-rich states like Gabon and Equatorial Guinea, as well as emerging producers like Chad and Cameroon.

Solima is but one example of a quiet revolution that has begun sweeping over those parts of the African continent where French companies once held sway.

And nowhere is this revolution more in evidence than in Senegal, the West African country that is the crown in the jewel of la Francophonie.

Turning dependency theory on its head, Senegal is pulling away from the 'periphery' of the French 'core' and building a relationship with another 'periphery' of the world economy, India.

Last year, India was second only to France as Senegal's most important trading partner. But this year, according to Pierre Goudiaby Atepa, advisor to the Senegalese president, India will actually overtake the former colonial power, thanks to its large puchases of phosphoric acid for the Indian fertiliser industry.

Indo-Senegalese trade stands at about $400 million annually.

France and India may be good friends but that hasn't prevented the French from resorting to dirty tricks to protect their backyard.

Last year, when Senegalese president Abdoulaye Wade decided to award the $15- million World Bank bus building contract to Tata Motors, desperate efforts were made to scuttle the deal.

A whispering campaign was started that Tata's buses would not be as safe and long-lasting as their French competitors. And then the Senegalese transporters' union was instigated to go on strike against the decision.

Under the initial stages of the contract, Tata is to produce 500 buses at the town of Thies. But eventually, the Senegalese-based JV, Senbus, plans to produce some 10,000 buses annually for the West African market.

"The Senegalese realised new Indian buses are half the cost of second-hand European buses", says Balakrishna Shetty, India's ambassador in Dakar.

So pleased are the Senegalese with their new-found India connections that they want other West African countries to turn to Delhi for the technology and investment they once sourced from Paris.

On Monday, the foreign ministers of Senegal, Cote d'Ivoire, Chad, Burkina Faso, Mali, Equatorial Guinea, Ghana and Guinea Bissau will meet here with external affairs minister Yashwant Sinha under the aegis of the TEAM-9 initiative, the brainchild of foreign secretary Shashank.

The Confederation of Indian Industry is also playing a key part in sensitising Indian businesses to the opportunities in West Africa.

At an interactive session between Indian businesses and TEAM-9 officials on Friday, however, it became clear that Indians have to overcome their reticence to do business with countries where French is the official language.