Economy

Published: June 26, 2023
Updated: June 26, 2023

India and Egypt Strengthen Ties to Form a Strategic Partnership during PM Modi's Visit

During Prime Minister Narendra Modi's two-day visit to Cairo, India and Egypt solidified their relationship by signing a significant strategic partnership treaty. The agreement, which was initially discussed during Egyptian President Abdel Fattah el-Sisi's visit to India as the chief guest for the Republic Day parade, aims to enhance cooperation in various sectors such as trade, investment, defence, security, renewable energy, culture, and people-to-people ties.

Elevating Economic Cooperation:

Egypt, recognizing the potential benefits of increased Indian investments, proposed that India utilize its strategic geographical location as a gateway to Europe, West Asia, and Africa. As part of this proposition, Egypt offered the possibility of establishing an industrial zone for India. Strengthening ties with Egypt could further bolster India's position as a leader of the Global South and foster closer relations with an Arab country beyond those in the Persian Gulf.

Honours and Engagements:

During the visit, Egyptian President el-Sisi conferred the Order of the Nile Award, Egypt's highest state honor, upon Prime Minister Modi. This recognition highlights the international acclaim Modi has received, as he now holds 13 such awards from various countries—more than any other Indian Prime Minister in history. Additionally, Modi met with the Grand Mufti of Egypt, emphasising his commitment to inclusivity and pluralism, particularly in the face of recent comments made by former US President Barack Obama regarding Indian Muslims.

Areas of Cooperation: Strengthening economic cooperation

The discussions between Modi and President el-Sisi centred on strengthening economic cooperation. Both sides explored opportunities for Indian investments in Egyptian infrastructure, particularly in the Suez Canal Authority. Agreements were signed in the fields of agriculture and healthcare to facilitate collaboration between the two nations. The meeting also included representatives from the Indian Unit in the Egyptian Cabinet, which proposed new areas of cooperation, including renewable energy, digital technology, and pharmaceuticals.

BRICS Membership:

India expressed its support for Egypt's request for membership in BRICS, an acronym representing the regional economies of Brazil, Russia, India, China, and South Africa. While India is actively considering multiple requests, it views Egypt as a friendly and strategic partner, making it a potential candidate for BRICS membership.

Cultural Exchange and Community Engagement:

During his visit, Prime Minister Modi interacted with various leaders and communities. He visited the Al-Hakim mosque in Cairo, where he met with the leaders of the Bohra community, with whom he has had close ties since his tenure as the Chief Minister of Gujarat. Modi also engaged in discussions with renowned Egyptian author and petroleum strategist Tarek Heggy, as well as Hassan Allam, the CEO of Hassan Allam Holding Company. These engagements focused on global geopolitics, energy security, radicalism, and gender equality.

Bilateral Trade:

India's bilateral trade with Egypt amounted to $6.06 billion in the fiscal year 2022-23, experiencing a slight decrease compared to the previous year's record high of $7.26 billion. Despite the decline, India maintained a trade surplus with Egypt, primarily driven by exports such as diesel, organic chemicals, heavy machinery, iron and steel, and cotton. Refined petroleum stood out as the largest import item from Egypt.

Investments and Employment:

Approximately 50 Indian companies have invested over $3.2 billion in Egypt across diverse sectors such as apparel, agriculture, chemicals, energy, automobiles, and retail. These investments directly and indirectly provide employment opportunities for around 35,000 Egyptians. Notable Indian companies with major investments in Egypt include TCI Sanmar Chemicals, Alexandria Carbon Black, Kirloskar, Dabur India, Flex P Films, scib Paints, Godrej, Mahindra and others.