As India prepares for Prime Minister Narendra Modi’s upcoming visit to Nigeria in November, Indian High Commissioner G. Balasubramanian sheds light on the multifaceted relationship between the two countries. Nigeria’s economy is primarily driven by crude oil, and the High Commissioner outlined the opportunities and challenges that characterize this important partnership in an exclusive interview with Financial Express Online.
When will the Prime Minister leave for Nigeria?
The trip has not been officially announced, but he is expected to visit African countries as part of a three-country tour in November before heading to Brazil for the G20 summit. He will first visit Nigeria, Brazil and Guyana.
economic situation in nigeria
Nigeria is an oil powerhouse, deriving approximately 90% of its revenue from oil and related products. The country has proven reserves of approximately 37.1 billion barrels of light and sweet crude oil and ranks ninth in the world with approximately 209.5 trillion cubic feet of natural gas reserves. Despite these abundant resources, the oil and gas sector faces significant disruption, mainly due to extremist attacks on infrastructure, forcing international oil companies (IOCs) to sell assets. However, the High Commissioner noted that the upstream market is poised to grow with increased offshore exploration and production activity.
Recent government reforms, such as the removal of gasoline subsidies and decontrol of the exchange rate, demonstrate Nigeria’s commitment to economic reform. The Economic Recovery and Growth Plan aims to diversify the economy beyond dependence on oil.
Balasubramanian stressed that the industrial sector, which contributes about 23% to GDP, includes oil and gas, manufacturing and construction, with agriculture also playing an important role.
Expanding trade relations
Trade between India and Nigeria has been volatile, with bilateral trade reaching $7.89 billion in 2023-24, down from $14.95 billion in 2021-22. This decline is mainly due to Nigeria’s diversion of oil exports to Western markets and India’s exploration of alternative oil sources. Nevertheless, India’s exports, including engineering products, refined crude oil, and pharmaceuticals, are growing at about 10% annually.
He pointed out that over 200 Indian companies are currently operating in Nigeria, with a total investment of about $27 billion in various sectors such as pharmaceuticals, power and construction. Indian companies are among the largest employers in Nigeria after the federal government. There is strong interest in diversifying investments, with potential areas for further cooperation including power, transport, infrastructure, maritime, agro-processing, mining and textiles.
Agricultural cooperation and food security
Agriculture is the cornerstone of Nigeria’s economy, employing approximately 70% of the population and contributing 25.18% of GDP in 2023. Despite over 70 million hectares of arable land, only about 44% is currently under cultivation. The Nigerian government recently removed import duties on rice and grains to address food security, raising expectations that large quantities of rice will be imported in the coming months.
The High Commissioner of India stressed the need for cooperation in the agricultural sector as Indian companies are already engaged in edible oil plantations and are also interested in grain cultivation. Discussions are underway for a memorandum of understanding (MoU) focused on agricultural cooperation, including food processing, farm machinery, and irrigation technology to reduce post-harvest losses.
Defense and security collaboration
Defense ties between India and Nigeria have historical roots, with India playing a key role in the establishment of the Nigerian National Defense College and Naval War College. He highlighted ongoing military training exchanges and cooperative efforts under the India Technical and Economic Cooperation (ITEC) program, which provides 150 slots annually for Nigerian defense personnel.
With growing interest in military equipment, Nigeria is considering sourcing helicopters and fighter jets from Indian manufacturers such as Hindustan Aeronautics Limited (HAL). He said these developments are in line with the broader strategic partnership between the two countries, with Nigeria procuring defense supplies from India in recent years.
Technical cooperation in space and cybersecurity
In addition to defense, India and Nigeria also cooperate in the areas of space and cybersecurity. The Memorandum of Understanding on Space Cooperation aims to strengthen bilateral relations, and a specialized training program for the Nigerian National Space Agency is scheduled for January 2025. Cooperation efforts will focus on remote sensing, mapping and satellite development.
Additionally, the recently signed Memorandum of Understanding between Computer Emergency Response Team of India (CERT-IN) and CERT-NG of Nigeria aims to strengthen cybersecurity cooperation. High Commissioner Balasubramanian said that meetings of the working group under this memorandum have already been held, underscoring efforts to address emerging cyber threats.
Strengthening pharmaceutical collaboration
The Indian pharmaceutical sector is dominant in Nigeria, with Indian products accounting for over 70% of the market. He said Nigeria regards India as the “pharmacy of the world” and is keen to deepen cooperation in this area. Initiatives such as a local vaccine production agreement between the Serum Institute of India and Nigeria’s Biovaccines bring India’s investment in Nigerian medicines to over $4 billion.
Parallel to efforts to provide quality generic medicines through Pradhan Mantri Bhartiya Janaushadhi Pariyojana (PMBTC), discussions on collaboration in active pharmaceutical ingredients (APIs) and clinical trials are underway. The Nigerian government is also interested in emulating India’s healthcare system, such as the COWIN platform and the Ayushman Bharat scheme, with India’s support.
Educational exchanges and opportunities
Education remains an important area of cooperation and India remains a popular destination for Nigerian students. Currently, over 5,000 Nigerian students are enrolled in various courses in India, and around 1,300 student visas are issued annually. The High Commissioner highlighted that two universities have been established in Nigeria in collaboration with India and negotiations are underway for a Memorandum of Cooperation in Education.
India offers several scholarships to Nigerian students to facilitate access to quality education at reputed educational institutions in India. This initiative will not only foster cultural exchange but also contribute to skill development in Nigeria.
A bright future awaits
Diverse areas of cooperation, from trade and agriculture to defense and education, enable our two countries to forge a mutually beneficial partnership. With a shared vision for growth and development, our two countries are poised to overcome the challenges and opportunities ahead.
