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Research Journal Social Sciences, Vol 18, No.1, 2010

India and Djibouti in the Indian Ocean Geopolitics

Khalid Mohammed
Abstract: Small but strategically located, Djibouti is an important state in the Horn of Africa. It dominates the busy shipping lanes of the Bab el Mandeb. Politically stable, its economy largely depends on its ports which provide trade outlet to neighbouring land locked Ethiopia. Presence of French, American and Japanese military contingents on its soil speak volumes of its strategic importanc. India has a long history of trade with Djibouti. Over the years both have developed multifaceted relationship. Indias trade with Europe, Mediterranean and Arab world depends on the Bab al Mandeb. To protect its trade and economic interests and to associate with US in its war against terror, India regularly sends combat ships and conducts naval exercises near Djibout. The paper explores Indias relations with Djibouti in the overall geopolitics of the Indian Ocean. Formerly known as French Territory of the Afars and the Issas, Republic of Djibouti lies in the Horn of Africa. Strategically located on the busy shipping lanes of the Bab el Mandeb, --the strait that links the Red Sea with the Gulf of Aden-- it has an area of about 23,200 sq km. Djibouti has land boundaries running for 516 km. Bounded on the southeast by Somalia for 58 km, on the south and west by Ethiopia for 349 km, and on the north by Eritrea for 109 km. The Country has a coastline of 314 km in the Gulf of Aden at the southern entrance to the Red Sea (Saint Veran, 2010). Djibouti has 16 islands scattered in the Gulf of Aden and Gulf of Tadjoura providing it important seaward extensions capable enough to monitor and control the Red Sea traffic. These islands are intensely important to the extent that the neighbours have lustful eyes to grab them. Border row between Djibouti and Eritrea over the disputed Ras Doumeira promontory on the shores of the Red Sea have flared up time and again since 1996 which provide enough proof of its strategic location. (IBRS, 2008) The Gulf of Tadjoura provides Djibouti important ports of Obock, Tadjoura and Djibouti. Location of these ports has turned it into a regional hub for the Red Sea and

36 Indian Ocean --and in a wider context for the three continents of Europe, Africa and Asia. Its container terminals on ports operating since February 1985, have added to its importance in the region. Djibouti already handles 4 million tones of containers trade. Geopolitical importance of Djibouti is further enhanced as neighbouring Ethiopia relies on it for a secure trade corridor and access to the Red Sea. During its hostilities with Eritrea in 1998-2000, Ethiopia was denied access to the Eritrean port of Assab. This rendered land locked Ethiopia totally dependent on Djibouti to handle its imports and exports, including huge shipments of U.S. food aid during the drought and famine in 2000. The Addis Ababa-Djibouti railroad is the only line serving central and southeastern Ethiopia and possibility is being explored to build an additional rail line from Djibouti to increase its trade connectivity with sea ports.(Sudan Tribune, 2010) Djibouti has a population of 516,055 according to 2009 estimates and it belongs to Somali, Afar, Ethiopian, Arab, French, and Italian ethnic stocks. About two-thirds of Djibouti's inhabitants live in the capital city. Among the 15,000 foreigners residing in Djibouti, the French form the major chunk including its approximately 3,000 troops. About 94% of the population is Muslim and 6% Christian. French and Arabic are the official languages while Somali and Afar are widely used. Country has a literacy rate of 67.9%. Djibouti's economy depends largely on its proximity to the large Ethiopian market and a sizeable foreign expatriate community. Its main economic activities are the Port of Djibouti, the banking sector, the airport, and the operation of the Addis Ababa-Djibouti rail line. The country had to divert significant budgetary resources from developmental and social services to military needs during the civil war (1991-94) and after. However, from 2001 on, Djibouti has attracted private sector capital investment of about US$200 million per annum. Djibouti had an estimated GDP of $982 million in 2008 and a per capita income of US$3,700. About 89% of its land is arid, unproductive, desert wasteland, 10% is pasture, and 1% is forested. Agriculture contributes less than 3% to its GDP and produces livestock, fishing, and limited commercial crops, including

37 fruits and vegetables. The country has natural resources like salt, gold, gypsum, limestone and energy resources such as geothermal, wind, and solar. Mineral deposits exist in the country, but with the exception of an extraordinary salt deposit at Lake Assal (the lowest point in Africa) they have not been exploited. Banking and insurance sector contributes 12.5% to the GDP while construction and public works, manufacturing, commerce, and agriculture contribute 22%. Imports to Djibouti accounted for $1.555 billion in 2006 and they consisted of basic commodities like food and beverages, pharmaceutical drugs, transport equipment, chemicals, and petroleum products. The country exported goods worth $340 million which included hides and skins, and coffee etc. Major markets for its trade are France, Ethiopia, Somalia, India, China, Saudi Arabia and other countries of Arabian Peninsula. Europeans have been attracted to Djibouti since late 19th century and conceived it as a strategic base at the mouth of the Red Sea. The recent wave of international terrorism, has given a new meaning to Djibouti as a strategic location near the world's busiest shipping lanes and the Arabian oil fields. Being part of the direct crossing point between Middle East and East Africa, Djibouti is feared to serve well as a transit point for terrorists, pirates and weapons in both the directions.8 To bring Djibouti closer to the Arabian Peninsula (thus joining Asia and African continents), a 29 km long Bridge of the Horns is proposed to be constructed at an estimated cost of US$20 billion. The Bridge between the coasts of Djibouti and Yemen across the Bab-el-Mandeb will provide connectivity between the two continents. Strategic importance of this sea bridge stems in part from the geopolitical importance of the site of Yemen and Djibouti on the map of regional and international interactions on the Red Sea. It will promote the movement between the Asian and African coast and strengthen the social and economic ties between Yemen and Djibouti smoothening the movement of the Gulf and African capitals, which is likely to make Djibouti an economic bridge between Africa and investors from the Gulf. (Yemen Times, 2008) It is due to its strategic importance that Djibouti serves as the headquarters for the European Unions Atalanta naval task

38 force combating piracy off the coast of Somalia. Djibouti is one of America's many outposts in war against terror. It houses part of Pentagon's new African Command consisting of 1,500 U.S. sailors, soldiers, airmen, Marines and Special Forces at Camp Lemonier, a naval expeditionary base outside the capital, since 2003. US naval vessels and aircraft use Djibouti's facilities, and the two countries perform joint military exercises. United States gave it US$7 million as military and economic aid in 2000. This included $2.7 million in emergency food aid, $2 million to start a humanitarian programme and $100,000 for self-help, democracy and human rights. This presence is focused to help impoverished Djiboutian population lest they fall into the anarchy of neighboring Somalia. United States fears that its grinding poverty, no solid economic or political foundations, and next-door Islamist extremists who want this as another base for themselves, may not fall prey to terrorist networks. The US presence is aimed to prevent Al Qaeda and other terrorist groups from accessing Yemen, Somalia, Eritrea, Kenya, Sudan and Ethiopia. The country retains close relations with France and other Western nations as well as with Islamic states. Djibouti is France's largest foreign military base and hosts several thousand French military personnel, including the 13e Dmi-Brigade de la Lgion trangre (13e DBLE - 13th Half-Brigade of the Foreign Legion). A small Japanese naval contingent is also deployed as part of an international flotilla battling Somali pirates. To check terrorism and piracy, France and U.S. have (intelligence) listening posts, in Djibouti. Apart from European powers, China has diplomatic presence in Djibouti since 1979. Various high level visits have taken place between the two countries during the last three decades. They signed an agreement on economic and technical cooperation. China has provided Djibouti with aid projects including the People's Palace, a stadium, an outpatient building, housing projects, and the office building of its Ministry of Foreign Affairs. China's has recently built up schools in several Djibouti villages. After 1982 till about June 2002, China and Djibouti had signed about 478 contracts for service cooperation. China and Djibouti signed an Agreement on Trade and the volume of trade between the two countries stood at US$ 49.83 million in 2002, of which China's exports accounted for

39 US$49.81 million, and imports US$20,000. Japan too had established diplomatic relations with Djibouti on 27 June, 1977 --the day Djibouti was recognized as a State. Japan has so far doled out grants worth 19.1 billion yen, has spent 2.1 billion Yen in form of technical cooperation, and 102 million yen as cultural grant in Aid. Djibouti imported automobiles worth 5,231 million yen from Japan in 2006. Djibouti seeks to play a stabilizing role in the usually tense regional politics of the Horn of Africa. The Country hosted UN-sponsored Somali reconciliation talks in 2008-2009 (the Djibouti Process), and provided military training for Transitional Federal Government (TFG) troops of Somalia in late 2009. Djiboutis relations with Eritrea have become strained after a military confrontation in June 2008 along their shared border. The situation remains at an impasse, despite international condemnation of Eritreas continued occupation of Djiboutian territory in Ras Doumeira area. Djibouti is a member of the League of Arab States (LAS) and the Organization of the Islamic Conference (OIC), as well as the African Union (AU), the Common Market for Eastern and Southern Africa (COMESA), and the International Organization of Francophones (Organisation international de la Francophonie, or OIF). In 1996, the Intergovernmental Authority on Development (IGAD- an organization for regional cooperation and economic integration), established its secretariat in Djibouti. The country is also a member of the East African Standby Brigade Coordination Mechanism (EASBRICOM), which is currently commanded by a Djiboutian general. The role of Djibouti has grown in international diplomacy as a bridge to other countries of the Horn of Africa and between African and Arab states. India-Djibouti relations India has a long history of relationship with the lands and the people of Horn of Africa. Indian traders and sea farers have been traversing the waters of northwestern Indian Ocean for centuries. Traders from Gujarat and Kerala frequently visited port of Adulis for trading in spices and silk for gold and ivory. There presence in the ports of Berbera, Yemen, and Djibouti are well recorded in the annals

40 of history. Indian cultural influences contributed notably to the social life of Djibouti along with the cultures of East Africa, and the Arab peninsula. Relations between the two countries began when in 1910 about ten Indians went to Djibouti and initiated shipping and import business. The Indian community in Djibouti at present is around 600 persons and about 100 of them are French nationals of Indian origin. Majority of them belong to Gujarat (Rajkot and Jamnagar) and Kerala. Most Indians are involved in trading and agency business representing companies from India, China, South Korea, and Taiwan. Some of them work as corporate employees holding positions in accounts and management, computer programmers, etc. The companies involved in ongoing Doraleh Port Project have also engaged a number of Indian experts and technicians. Many Indians are also working in the Djibouti port and refinery project. Much before its independence in 1977, India had appointed its Honorary Consul to Djibouti in 1969. Djibouti opened its Embassy in New Delhi in 2004 and a Consulate in Mumbai in 2006. To invigorate cultural relations, both signed a Cultural Cooperation Agreement on 31st January 1989. After 2002, both the countries felt the need for greater cooperation in different fields. In May 2003 President of Djibouti visited India along with other ministers and a 30 member business delegation. The visit not only opened up opportunities in many areas of mutual interest but also enhanced contacts, business linkages and bilateral relations. During the visit both the countries signed Bilateral Investment Promotion and Protection Agreement (BIPPA), Civil Aviation Agreement, and Executive Programme of Cultural, Education and Scientific Cooperation for the year 20032005 at New Delhi on 19th May 2003. In June, 2006, Indias TCIL and Djibouti signed Pan-African e-Network Agreement. India is an emerging economic and naval power in the Indian Ocean region where Somalian coast is increasingly becoming infested with the pirates. To protect its trade and commerce interests Indian naval ships keep calling on the ports of many of the countries of east Africa and patrol the Ocean near Somalian coast and the Gulf of Aden. To demonstrate its presence in the area, Indian naval ships have been calling at Djibouti ports since late sixties. Indian naval ship INS Brahma Putra called at

41 Djibouti port in May 1967, INS Gharial in March 1970, INS Mysore in January, 1973. In the recent years Indian naval ships INS Sindhuraj called at Djibouti port in January 2002, INS Sindhuratna in November 2002 INS Tarangini from 10 February to 14 February, 2003 and again in May 2005. INS Talwar visited there in August 2003 and INS Dunagiri in May 2004. A naval flotilla consisting of INS Viraat, INS Mysore, INS Godavari, INS Shalki and INS Aditya visited Djibouti under the command of Rear Admiral R.A. Contractor in November 2005 and held joint exercises codenamed Varuna 05 with French Navy. Commander of the Armed Forces of Djibouti visited India in October 2003. Indian and Djibouti based French Navy took part in "Varuna 07", a sea and air military exercise from 11 till 19 September 2007 offshore Somali coast and in the Gulf of Aden. Indian guided missile frigate INS Beas visited Djibouti on May 4 to May 7, 2009, after conducting exercises with their navy. Djibouti therefore has been a focus of attention for Indian Government and call for exploring its relations with India. Economic relations In the recent years Djibouti has shown its keen interest to develop economic partnership with India and to learn and receive assistance especially in areas of education, information technology, agriculture, small scale industries, and portable electricity generating units, fisheries, and water resource development. After its Presidents visit to India in 2003, economic and commercial relations picked up momentum. India agreed to provide an EXIM Bank Line of Credit of US$ 10 million and both felt the need to create institutional mechanism such as a Joint Commission to strengthen bilateral relations. India is setting up a Cement Project in Ali Sabieh under the agreed credit limit and exploring the possibility to transform Lake Abbe --a chain of six connected salt lakes at Djibouti-Ethiopia border-- by developing a chain of chemical industries to produce caustic soda. India has offered assistance in areas such as setting up Tool Centres in different parts of the country where small tools could be produced. It has agreed to provide training to Djibouti nationals for small and medium scale enterprises to acquire

42 skill for using the tools. Indias IRCON has conducted feasibility study for rehabilitation works of rural electrification in Djibouti and Kirloskar have supplied generator sets for power production. (Somaliland Times, 2007) Trade and Investment Most of the trade between India and Djibouti is conducted primarily by the small Indian community. The major items exported by India are iron and steel products, paper and plastic products, machinery, metals, yarns and fabrics, food items and drugs and pharmaceuticals. Main imports to India include raw hides and skins, metal scraps and leather. After 2003 trade relations between the two countries have picked up considerably as export to Djibouti increased by 68% (US$ 72.9 million) during April 2003-March 2004 as compared to US$ 37.2 million during the corresponding period of 2002-2003. Indias exports account for 17.8% of Djiboutis imports and its imports from Djibouti were US$ 0.81 million and US$ 1.2 million during the period 2002-2003 and 2003-2004 financial year respectively. An Indian construction company, Patel Engineering Works bagged nearly $1 billion (about Rs. 4,600 crore) order for building a 350-km highway connecting Djibouti border to Ethiopia. Another Mumbai based firm HRD and CO has got an order for a geo-thermal energy project in Djibouti on a power purchase agreement. Djibouti is also looking at tie-ups with Indian computer-education firms like NIIT and Aptech to start institutes in Djibouti. Educational and technical cooperation India provides training to Djibouti nationals under the Indian Technical and Economic Cooperation (ITEC) programme. It granted two scholarships every year till the year 2003-2004 and the number was increased to five after 2005-06. Under Article 6 of the Cultural Exchange Programme 2003-2005, India had committed to offer scholarships for post graduate studies at Indian Universities to Djibouti nationals. Under General Cultural Scholarship Scheme (GCSS), ICCR has been offering one scholarship to Djiboutian nationals since 1992-1993. About 750 students from Djibouti are

43 pursuing different degrees in India. India had also provided humanitarian assistance worth US$ 1 million in the form of wheat, rice and medicine to meet the requirements arising from drought in 2003. India and Djibouti in the Indian Ocean Geopolitics Djibouti is particularly vulnerable to political developments in the region. It is the most stable country on the Horn of Africa largely depending on its former colonial power, i.e. France. The French were aware of its strategic importance when they took possession of the territory in 1859. This importance was further enhanced when a French company constructed the railway line from Djibouti to Addis Ababa, the capital of Ethiopia. Djibouti is a very useful port in this sensitive and volatile region. In the recent years when Ethiopian Marxist regime fell in 1991 (resulting restoration of economic growth and external trading links), the demand for Djibouti's port services began to rise further. After Eritrea became independent in 1993 and in 1998 it had a border war with Ethiopia, the land locked Ethiopia became completely dependent on Djibouti as its road links through Eritrea were snapped. Djibouti is of exceptional interest to India as a regional ally due to increasing threat posed by piracy in this area which has caused concern to Indias shipping trade. At the 101st council of the International Maritime Organization, India called for a United Nations peacekeeping force under a unified command to tackle piracy in the area. India has conducted military counter-piracy operations by its naval ships near Djibouti and Somalia. Joint naval exercises by Indian and French navy off Djibouti coast in the recent years testifies how serious India is in this regard. India is the single largest foreign investor in Ethiopia with approvals crossing 3.5 billion US dollars. Of this, two billion dollars is in the agriculture and floriculture sector alone. It enjoys a huge trade surplus with Ethiopia with exports accounting at US$400 million and imports at around 14 million. Use of Djibouti ports for its trade and commerce with Ethiopia is important for India.(Thaindia News, 2008) Djibouti is very close to the countries of Arabian Peninsula.

44 If the proposed Bridge of the Horns becomes a reality it will provide connectivity between the two continents. In that event Djibouti is likely to be an economic hub of that region where Indian trade and investment has the potential to increase manifold. The Country is a regional ally of United States in the fight against terrorism. India too cooperates with the US in this regard. It is therefore mutually beneficial for India and Djibouti to maintain close relationship to share intelligence and provide logistic support to each other in their war against terror. Growing closeness in Indo-US relations, especially since 9/11, has made it easier for India to enter into close political and security cooperation with other American friends such as Australia and South Africa on the Indian Ocean littoral. Similarly, rise of India as a key player in the gradual economic and security integration of the countries of the Indian Ocean can have multifarious effects. India is expanding its bilateral relations with almost each country in the region. It has taken care that the smaller countries like Djibouti also find due and honourable place in its foreign policy calculations as they are equally important in the overall geopolitics of the Indian Ocean. References: Aqeel Al-Halali (2008) Construction begins on Yemen-Djibouti Bridge, Yemen Times, July 31, 2008; Frontier India (2007) Exercise Varuna 07, Frontier India, September 18. International Boundaries Research Unit (2008) Djibouti-Eritrea boundary row re-emerges, Durham University, Available at, on 23.9.2010 Saint Veran Robert et al (1981) Djibouti: Pawn of the Horn of Africa, Lanham,Scarecrow Press. Somaliland Times (2007) India Gives $20 Million Funding for Djibouti Cement Plant, Somaliland Times, issue no.275, April 28. Sudan Tribune (2010) "Ethiopia asks Indias support to improve railways with Djibouti", Sudan Times, February 3. Thaindia News (2008) India, Ethiopia to intensify trade and investment links, Thaindian News, (online) October 03.