Winners and whiners in the scramble for Africa In September 2009 when Manoj Rai, a quality control engineer

from India, accepted a managerial job offer at a beverage company in Rwanda, his only concern was homesickness. After all, the east African country was over 6000 km away. His fears proved to be baseless when Rai and his wife landed in Kigali, Rwandas beautiful capital city, they were simply blown away by the warmth of their African neighbours and colleagues. And to make them feel right at home, their corporate perks included a brand new Indian made Mahindra Scorpio SUV. This wasnt out of the blue, as Mahindra, Tata, Bajaj and TVS vehicles are an increasingly common sight on African roads. For entertainment Rai and his wife could go out to a number of Indian restaurants in Kigali town centre. By March 2012, the couple was able to use a mobile phone service provided by Airtel Rwanda, a subsidiary of Indias Bharti Airtel. On air In June 2010 when Bharti Airtel announced a $10.7 billion investment in the nascent African telecom market, it was ridiculed as a monumental overreach an uppity Indian company with multinational dreams was seen as burning cash in a continent the West had written off. Where were the urban agglomerations required for mobile phone growth? Who would secure the cell towers in these unstable countries? And didnt Africans need food rather than mobile gizmos? Well, seems like Airtel wasnt listening. When pundits declared Africa was a highcost operation because of its vast distances and thinly spread out population, Airtel simply duplicated its low-cost India strategy. It slashed tariffs and carpeted the vast continent with cellular networks. Today, Airtel is a household name in 17 African countries, including countries whose names were in Western parlance synonyms of failure: Congo, Niger, Chad, Gabon, Malawai, Ghana, Zambia, Burkina Faso and Sierra Leone. The Indian companys bold push has benefitted Africans where it matters most in their pockets, with mobile tariffs falling up to an incredible 90 percent across the continent. The over 6500 employees of the old networks that Airtel acquired were not retrenched or replaced but were retrained and reabsorbed within subsidiary companies. Suddenly, the likes of CNN arent laughing any more. Airtels price war has swept away or checked the expansion of Western competitors. And the company still made money; revenues from mobile services in Africa increased to Rs 6,051.2 crore (over US$1 billion) at the end of September 2012 from Rs 4,703.2 crore last year. On land Approximately 10 km north of the international airport in Lubumbashi, the second largest city in the central African republic of Congo, is the swank new Kiswishi satellite city (http://www.rengroup.com/UrbanDevelopments/Portfolio/Kiswishi/). In this formerly civil war blighted territory, Russias Renaissance Group is investing $50 million to build gleaming new malls, lavish residential suburbs, supermarkets and dining strips. The building boom in the mineral-rich country is fuelled by factories and businesses rising from once barren land. Where today thousands of hectares of new glass-and-steel edifices stand, just a few months ago there was nothing. At breakneck speed, Moscow-based Renaissance Partners, which manages a $750million investment portfolio, is constructing luxury developments that cater for

Africas growing and in Western eyes, invisible middle class. Across Africa, from Ghana to Zimbabwe and Zambia to Nairobi, its projects are dotting what used to be dusty districts. The Russians grandest project is yet to come the $5-billion Tatu City outside Nairobi, Kenya. On water Eighty per cent of the waters that go into the mighty Nile river originate in Ethiopia, not Egypt. But despite being the uppermost riparian state, an unequal 1959 treaty saw to it that Ethiopia was able to use only 2 per cent of the Niles flow. While every dictator and his uncle was being lured into the Western camp with IMFWorld Bank dam-building loans (dams held a peculiar attraction for the Bretton Woods twins), Ethiopia was conspicuously denied loans. There was a reason: Egypt was under Western control and helping Ethiopia build a dam and for a change a useful one would be wrong policy. Today, free of internecine wars, Ethiopia is turning to Chinese banks to underwrite around a third of the cost of the $4.8 billion dam. Though significant, the Ethiopian investment will be a mere entry in Chinas African portfolio. Since 2000, Chinese investment in the continent has ballooned from $2 billion to an incredible $166 billion this year. China also did $126.9 billion worth of trade with Africa last year. Turf struggle As China, Russia and India look towards Africa to fuel their growing empires, it is causing a great deal among the old interlocutors. Says Canadas Mail and Globe, In an age-old pattern, much of the BRIC investment flowing into Africa is benefiting the political and business elite, rather than ordinary Africans. In Lubumbashi, some of the harshest criticism has been directed at BRIC investors including an Indian company, Chemaf, which processes copper and cobalt in several factories around the city. The Canadian news network says although the Indians have created 3,000 jobs in the area, their factory has become a major health hazard, polluting the air and soil. It claims local people have been burned by acid spills. They lower their standards, the Globe and Mail quotes the Congolese as saying. The Globe and Mail admits its investigation was spurred by the need to reexamine Canadas aid programme as well as its corporate interests in Africa. It complains how Congo seized a massive C$2.5 billion project jointly owned between Vancouverbased First Quantum Minerals, the World Bank and the state mining company, Gecamines. The project is now being implemented by Kazakhstan. How to get rich this time, all of us Western companies and charities have been carrying on their work for over a hundred years yet have barely made a dent in poverty anywhere. In Africa their record has been extraordinarily poor. Local leaders say theyve been following Western business and development models for decades without seeing returns. Borrowing a metaphor from a popular Hindi movie of yesteryears, aid is like dunking your enemy in liquid oxygen the liquid wont let them live and the oxygen wont let them die. That is why when Westerners start telling me about developmental work they are doing in Africa, I start gazing at the inside of my eyelids. Investment in industry especially by Chinese, Indian and Russian companies is lifting vast swathes of Africa out of the Third World. And these new players are guided purely by the profit motive they pump in money because they want returns at

some point. Where once there was colonialism, today it is purely capitalism at work here. And what do you know, it works. The companies profit, the Africans have jobs, and the local governments collect taxes. And as for the new enterprises benefiting only the elites, even if that were true it is worth noting that when the West was involved, it was often just one dictator and his family who was making money. New players, new strategies The emerging powers hold key advantages in the continent. China has endless reserves of cash. Not only do the Chinese give Africa credit at firesale rates, they do it with a flourish at the end of every major project they are known to throw in a significant gift such as a free school, hospital or luxury hotel. Try beating that. Despite or perhaps because of Beijings overwhelming presence, the Africans, always wary of colonialism, are looking to Russia for an alternative, in an attempt to hedge the risks. Russia is drawing upon the former Soviet Unions legacy of political and economic influence. At a December 2011 Russia-Africa Business Forum, initiated by Ethiopian Prime Minister Melas Zenawi, the Russian side announced it would return to Africa in a big way. Mikhail Margelov, a Russian presidential representative, said: In the 1990s, Russia gave up practically all of its interests, freeing up the territory for the United States, the European Union and China. In 1992, Russia closed nine embassies in Sub-Saharan Africa. The new economy led to strategic losses, and now we need to make up for them. Indias rise in Africa is remarkable for being private sector led. New Delhi is only known to make token statements on its close relationship with Africa. However, Indias soft power, its growing African diaspora, and history of fighting colonialism and Apartheid (India refused to play South Africa in the 1974 Davis Cup final) are big strengths. Africa safari BRICS in the front seat Africa is the last great untapped market. It has 60 per cent of the uncultivated land on earth. This has attracted as many as 20 Indian farming companies, with Bangalorebased Karuturi Global, which is leasing 741,000 acres of local land, an area larger than Luxembourg. The mineral wealth is incalculable, with Congo alone having $24 trillion worth of untapped resources (equal to the GDP of the US and Europe combined). Russian companies believe they know best how to dig out this treasure for everyones mutual benefit. The peace dividend is kicking in too. With the end of the Cold War many of the longrunning proxy wars have fizzled out, making it possible for trade and industry to flourish for the first time in more than three centuries.
To be sure, the West isnt prepared to let the BRICS eat their lunch. Americas African Growth and Opportunity Act redefines its relations with the continent, which was governed largely by aid, emergency relief and Cold War thinking.

But in the new race for Africas riches, the Europe and the United States are hobbled by their colonial past. On the other hand, India, China and Russia are considered kosher. As Kenyas Jomo Kenyatta said, First, we had the land and you had the Bible. You asked us to close our eyes and pray. When we opened our eyes, we had the Bible and you had the land.

This time the Africans have their eyes wide open.