Export-Import Bank of India (Exim Bank)’s
study entitled “Connecting Africa: Role of Transport Infrastructure” was
released at the hands of Shri Suresh Prabhu, Hon’ble Minister of Commerce &
Industry, Government of India, in the presence of H E Dr Saulos Klaus Chilima,
Vice President, Republic of Malawi, H E Mr Edward Ssekandi, Vice President,
Republic of Uganda, Hon Gen (Rtd) Dr.Constantino G.N.D. Chiwenga, Vice
President, Republic of Zimbabwe, Mr. David Rasquinha, Managing Director,
Export-Import Bank of India, Ms. ShobanaKamineni, President,
Confederation of Indian Industry (CII) and Mr. Chandrajit Banerjee, Director
General, CII during the CII-EXIM BANK Conclave on India Africa Project
Partnership held at New Delhi on March 25, 2018, according to a release from
Exim Bank’s Study analyses the existing
situation of the transport sector in Africa, the challenges to its development
and the strategies for enhancing transportation network and connectivity in the
continent. The study highlighted that inadequate transport infrastructure adds
around 30-40 percent to the costs of goods traded among African countries.
Further, since Africa is home to 16 landlocked countries, poor and
under-developed transportation infrastructure limit accessibility to consumers,
hamper intra-regional trade and drive up import and export costs.
Though road transport is the principal mode
of motorised transport in the region, roughly 28% of the roads have been paved,
of which just half are in good condition. On top of these, the road to
population ratio in Sub-Saharan Africa is estimated at 27-km per 10,000 people.
As regards to rail transport, most of the rail lines are low-speed,
small-scale, undercapitalized networks carrying low axle loads. Except for
South Africa and few countries in Northern Africa, rail network in Africa lag
behind those in most other regions in the world.
African ports face challenges like
under-developed infrastructure, long cargo clearance times, usage of outdated
equipment and low levels of automation, among others, resulting in significant
revenue losses. Similarly,African air transport growth has been subdued to a
large extent due to underdeveloped infrastructure and in part to the lack of a
proper liberalisation policy among African nations. The share of Africa in
global aviation industry remains relatively small compared to other regions.
With the expected increase in Africa’s trade in the coming days, up gradation
of transport sector acquire renewed interest. A better transport connectivity
could lead to reduced trade costs, while enhancing regional integration in
The study reports the existence of a large
gap in infrastructure financing for transport sector in Africa, which cannot be
fully financed by the African National Governments and Aid for Trade, and
suggested that such gap need to be bridged with innovative financing mechanisms
such as infrastructure bonds, sovereign wealth funds, and output-based
long-term PPP agreements, among others.
The study also suggests that African
economies could emulate some of the successful infrastructure mechanisms
practice by India such as toll-operate-transfer (TOT) andInfrastructure
Investment Trust for monetizing existing assets for infrastructure development,
among others, and collaboration with development partners for co-financing new