Asia-Africa Growth Corridor (AAGC)

• Aiming to strengthen the growth and connectivity between Asia and Africa, India and Japan initiated the Asia-Africa Growth Corridor (AAGC), which primarily focuses on Development Cooperation Projects, Quality Infrastructure and Institutional Connectivity, Enhancing Skills, and People-to-People Partnership. 

About AAGC:

• The AAGC is an attempt to create a “free and open Indo-Pacific region” by rediscovering ancient sea-routes and creating new sea corridors that will link the African continent with India and countries in South-Asia and South-East Asia.
• Sea corridors will be “low-cost” and have “less carbon footprint” when compared to a land corridor. For instance, under the AAGC, there is a plan to connect ports in Jamnagar (Gujarat) with Djibouti in the Gulf of Eden.
• Similarly, ports of Mombasa and Zanzibar will be connected to ports near Madurai; Kolkata will be linked to Sittwe port in Myanmar.
• India is developing ports under the Sagarmala programme specifically for this purpose. Apart from developing sea corridors , the AAGC also proposes to build robust institutional, industrial and transport infrastructure in growth poles among countries in Asia and Africa.
• The idea is to enable economies in Asia and Africa to further integrate and collectively emerge as a globally competitive economic bloc.
• Japan’s contribution to the project will be its state-of-the-art technology and ability to build quality infrastructure, while India will bring in its expertise of working in Africa.
• The private sector of both countries are expected to play big role by coming together to form joint-ventures and consortiums, to take up infrastructure, power or agribusiness projects in Africa.
• The proposal for an AAGC was first mentioned in the joint declaration issued by prime ministers Modi and Shinzo Abe in November 2016. The declaration included their intention to work jointly and cooperatively with other countries to promote development of industrial corridors and networks in Asia and Africa.

Four main components of AAGC are:

• Development and cooperation projects
• Quality infrastructure and institutional connectivity
• Capacity and skill enhancement
• People to people partnerships

Analysis:

•  
• AAGC will essentially be a sea corridor linking Africa with India and other countries of South-East Asia and Oceania.
• It is being presented as a “distinct initiative” borne out of a consultative process which would be profitable and bankable, unlike the “government-funded model” of OBOR (One Belt One Road) project.
• In 2015, the five of the fastest growing economies in Africa were non-resource rich, with Ethiopia, Cote d’Ivoire and Rwanda leading the pack with GDP growth rates of 10.2 per cent, 8.8 per cent and 7.1 per cent, respectively. Similarly, in 2016, countries like Senegal clocked a growth rate of 7.5 per cent, while Ethiopia (8 per cent), Kenya (6.5 percent) and Tanzania (7 per cent) all recorded impressive growth.
• There is a need to conduct more studies to list the current demands and challenges of economic, socio-cultural and political partnership pertaining to AAGC. It will bring out the existing challenges and barriers to this project. It will also spell out the cooperation aspects of sustainable growth and development exchange of best practices.

By: Vishal