India and Uganda on Tuesday agreed to boost bilateral cooperation in the areas of economy and defence. It is the first visit by an Indian Prime Minister to the country since 1997.
The Republic of Uganda is a landlocked country in East Africa, bordered by Kenya, South Sudan, Democratic Republic of Congo, Rwanda and Tanzania. It is named after the Buganda Kingdom that encompasses the southern portion of the state. It is known as the “Pearl of Africa” for its natural beauty.
Since its independence from the British in 1962, the country has been plagued with a military coup, dictatorship and a 6-year guerrilla war in 1986 after which the current President Yoweri Museveni came to power.
Relations between India and Uganda date back to times when traders exchanged goods in dhows across the Indian Ocean. Over 30,000 Indians had migrated to Uganda in the 19th century to construct the Mombasa-Kampala railway line. Indian laborers who stayed back thrived into a large and economically successful community. The success of the Indian freedom struggle had inspired Ugandan activists to fight colonialism. The relationship between the two nations has always been cordial, except during the reign of Idi Amin who had expelled nearly 60,000 Indians in 1972, handing their businesses over to locals.
After Museveni came to power, he reversed Amin’s anti-Indian policies. Today, about 20,000 Indians live and work in Uganda. They play a key role in the economy as Indian businesses employ thousands of Ugandans in the manufacturing, trade and service sectors. Since the 1980s, India has emerged as one of the largest investors and trading partners of Uganda. It also emerged as the 2nd largest source of Foreign Direct Investment (FDI) in 2011. Bilateral trade stood at US$ 454.47 million in 2011-12. Uganda has benefited from India's Focus Africa Initiative and its New Economic Partnership for Africa’s Development, which have set aside over $200 million for Africa's economic development.
India has offered Uganda loans worth $205 million to aid the country in its expansion of electricity distribution infrastructure and invest in its agriculture sector, which employs majority of its workforce. Of this amount, $141 million will be employed to build electricity transmission lines and substations, while the remaining $64 million will be spent on boosting dairy and agricultural production. The deal was signed after high level delegation talks between Indian Prime Minister Narendra Modi and Ugandan President Museveni. "India will always support Uganda's economic development and nation-building efforts," Modi said. Uganda's Foreign Affairs PS Mugoya stated that the government had been negotiating the two loans for a long time. Training, capacity building and infrastructure creation are core areas of cooperation between India and Uganda.
The two leaders signed 4 MoUs in defense cooperation and other areas such as cultural exchange programmes, visa exemption for diplomatic and service passport holders, and setting up a material testing laboratory. Modi stated: “We are ready to further strengthen our defense ties.” He suggested that Indian companies must invest in Uganda’s healthcare sector. Bilateral trade and investment has been steadily increasing between the two states. India has offered to deliver vehicles, ambulances and cancer therapy machines to Uganda. There has been increased emphasis on tourism, with Museveni urging more Indians to visit the country.
Additionally, the two leaders reiterated the need for a reform of the United Nations Security Council, including its expansion, to make it more representative and responsive to the geopolitical realities of the 21st century.
Modi had arrived at Kampala from Rwanda on his five-day tour of three African states. It is the first Prime Ministerial visit from India to Uganda in over 20 years. Modi had previously visited in 2007 when he was the Chief Minister of Gujarat. From here, he is going to head to South Africa to participate in the BRICS summit, whose theme this year is “BRICS in Africa”.
Modi had addressed the Indian diaspora Tuesday evening. He emphasized that India was emerging as a global manufacturing and start-up hub. Bringing the resource-rich African continent to the fore of his government’s foreign policy, India plans to open up 18 new embassies across the region. Invoking the leadership of Mahatma Gandhi, the Indian Prime Minister indicated that some of the most profound changes to Africa had come through Gandhian philosophy inspiring leaders like Nelson Mandela and Desmond Tutu among others.
Our assessment is that Modi’s visit is very crucial in fostering a strong relationship between the two countries. We believe that the recent move reflects the seriousness and intensity of India’s engagement with the East African state. We feel that Indian investments might play an important role in Uganda’s structural transformation.