24 January 2025 : Daily Answer Writing
Q1) Examine the significance of India-Middle East-Europe Economic Corridor (IMEC). What are the potential geopolitical and geoeconomic benefits for India?
(150 Words/10 Marks)
Answer:
The India-Middle East-Europe Economic Corridor Project was signed on the sidelines of the G20 summit in New Delhi by Saudi Arabia, European Union, India, UAE, France, Germany, Italy, and US.
The connectivity project seeks to develop a seamless infrastructure of ports, railways, roads, sea lines and pipelines to enhance trade among India, the Arabian Peninsula, the Mediterranean region and Europe.
Geopolitical benefits for India:
- It is an outcome of the growing diplomatic and political convergence between India, the Arab Gulf monarchies, Israel, US and the European Union (EU)
- It can counter China’s Belt and Road Initiative (BRI) in the Eurasian region and effectively control the aggressive debt-trap diplomacy of China.
- Establishes India as a key player in efforts to establish diplomatic ties between Saudi Arabia and Israel + greater economic integration and interdependence can create the necessary imperative towards peace in the conflict-ridden West Asian region.
- It bypasses Pakistan, bringing an end to the logjam that projects of the past have suffered. [E.g. TAPI pipeline.]
- The project can be extended to Africa and can become a Trans-African corridor. This can counter China’s expanding sphere of influence in Africa.
- The project revives and deepens centuries old civilizational linkages that were not just cultural but also strategic.
Economic benefits for India:
- It gives a fillip to economic growth by connecting key trade routes + reduces transit time [e.g. it makes trade with Europe 40% faster compared to the Suez Canal route]
- Connect India with the Eastern Mediterranean and Western Europe with a shorter route bypassing the naval choke points of Bab al-Mandab and the Suez Canal + stabilize India’s energy security.
- EU and the GCC are India’s largest trading blocs, and the IMEC promises to connect both regions through one economic corridor, creating extraordinary opportunities for growth in trade and commercial activities.
- The corridor will lead to the development of SEZs along its route. This will lead to attracting FDI and increase job creation.
However, there are certain challenges to the IMEC:
- Geopolitical uncertainties in West Asia make the project vulnerable to future challenges and logjams. [e.g., changing stance of gulf nations on Israel-Palestine conflict; rift between US/Europe with Saudi Arabia on Human rights issues]
- Big regional economies like Türkiye, Egypt, Iran, Qatar etc. have been left out of the IMEC, making it inherently lacking in the idea of bringing greater economic integration;
- BRI, is more economically incentivized as it creates a greater connectivity bringing most regional countries
- Competing routes passing through the Bab al- Mandab, the Red Sea and the Suez Canal that connect South Asia to Europe – IMEC could become just a costly infrastructure project ignoring that large parts of the Arabian Peninsula are barren deserts with no economic depth.
- The cost and financing of the project seem to be a significant challenge. The estimates range between USD 3-8 billions.
- The project involves a multi-modal transport corridor which could prove to be a logistical challenge in planning and coordination.
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