Syllabus: Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests.
Context and Strategic Importance
- Ethiopia, with ~109 million population (2024), is among Africa’s fastest-growing economies.
- It holds strategic importance due to Horn of Africa location, large market and manufacturing base.
- Headquarters of the African Union, enhancing diplomatic and continental relevance.
- Despite internal conflicts, Ethiopia remains a regional anchor of stability with effective military.
- Possesses strong renewable energy potential, especially hydropower, enabling regional energy exports.
Geopolitical and Economic Setting
- Landlocked Ethiopia traditionally depends on Djibouti for Red Sea access.
- Recent diversification efforts via Somaliland and Eritrea aim at strategic autonomy.
- Post-conflict political regeneration creates a window for renewed external partnerships.
- Ethiopia’s BRICS membership enhances its role in emerging global governance frameworks.
India–Ethiopia Historical and Educational Ties
- India–Ethiopia relations span over a century of educational cooperation.
- Indian teachers shaped Ethiopia’s education system, earning long-standing goodwill.
- Ethiopia was the pilot country for the Pan-African e-Network project (2007).
- Continued collaboration with IIT Delhi supports tele-education and digital learning.
- Ethiopia sends one of the highest numbers of African students to India.
- Hosts the largest African PhD cohort studying in Indian institutions.
- Graduates from Indian programmes staffed newly created Ethiopian universities.
Investment and Economic Cooperation
- Indian investments surged after Lines of Credit (LoCs) from 2006, crossing $4 billion.
- Early investments focused on agriculture, though many exited due to operational constraints.
- Current opportunities lie in mining, especially gold, rare earths and critical minerals.
- Indian Embassy’s mining survey highlights potential alongside regulatory and logistics challenges.
- Mining cooperation can secure inputs for India’s renewables, batteries and semiconductors.
Defence Cooperation
- India assisted Ethiopia militarily since Harar Military Academy (1956).
- Since 2009, Indian teams have trained Ethiopian defence forces.
- Ethiopia seeks modern equipment to replace aging Soviet-era platforms.
- India offers cost-effective, battle-tested defence systems.
- New Defence Cooperation MoU and Joint Defence Committee institutionalise collaboration.
- Ethiopia’s responsible repayment under IDEAS supports future defence-linked credit lines.
Future Pathways and Multilateral Engagement
- Ethiopia seeks Indian investment in pharmaceuticals, agro-processing, manufacturing and mining.
- Updating DTAA and Bilateral Investment Treaty can boost private-sector confidence.
- Addressing forex shortages, taxation and regulatory consistency remains critical.
- Indian diaspora highlights foreign exchange access as a major bottleneck.
- AfCFTA allows Ethiopian-based Indian firms wider continental market access.
- India’s duty-free tariff preference remains vital amid global trade uncertainties.
Conclusion
- Renewed political engagement, including the Modi–Abiy Ahmed meeting at G20, revitalises ties.
- With reforms, strategic alignment and investment facilitation, India–Ethiopia relations can evolve into a model India–Africa partnership in the coming decade.