Prime Minister Narendra Modi, who is currently on a state visit to the USA will be visiting Egypt for two days on June 24, at the invitation of Abdul Fattah El Sisi, president of the Arab Republic of Egypt.
Egypt is positioning itself as an ideal investment destination for Indian firms through its Suez Canal region. Egypt’s development axis covering industry and logistics areas will be displayed during Prime Minister Narendra Modi’s first visit to Cairo.
New Delhi
During Prime Minister Narendra Modi’s visit to the country from 24 to 25 June, which will be the first by an Indian Prime Minister since 1997, Egypt’s announcement that it will offer a dedicated slot for India in the Suez Canal Economic ZoneSCEZ is expected to be a major topic of discussion.
As an important investment destination for Indian enterprises, Egypt has put the Suez Canal region in its sights.
The Suez Canal, in which Egypt controls 20 % of global container traffic, is one of the major strategic choke points on the world’s maritime route connecting the Mediterranean Sea with the Red Sea and the Indian Ocean.
There is also a great deal of importance in Indian trade with the Suez Canal. There are an additional 500,000 barrels per day of crude oil delivered and carried through the Canal to India from the overall 4.8 million barrels per day.
A number of industrial and logistical zones are located on the development axis of the Suez Canal region, SCZONE. By linking the Red and Mediterranean seas through mega industrial and logistical zones, the SCZONE is part of Egypt’s plan to become a global logistics and commercial center. With six strategically located maritime ports between Africa, the Middle East, and Europe, it is a 460-kilometer independent, emerging international commercial hub.
Recently, an Indian delegation led by the President of the Suez Canal Economic Zone Walid Gamal Eldin attended discussions on Egypt’s economic engagement, in particular potential investments in a number of different sectors such as Renewable Energy, Green Hydrogen, and Infrastructure. During the visit to New Delhi by Egyptian President Abdel Fattah el Sisi in January, India was invited to provide full support for setting up a major industry presence in S.C.Z.
Speaking to a gathering of leading Indian businessmen, Sisi said that the region around the Suez Canal held great potential for businesses wishing to exploit Egypt’s strategically located location.
In order to start construction of the planned green hydrogen project in Sokhna in early 2024, SCZONE recently signed a framework agreement with ACME, an Indian company.
Increasing trade and investment linkages
It comes at a time when India is also looking for ways to expand its relationship with Egypt, an important political player in both the Middle East and Africa.
The government of Egypt said it would welcome India’s investments, mainly in the area of environmentally friendly hydrogen production.
Significant projects have already been undertaken by India’s Private Enterprises in Egypt.
Officials with the SCZone said Indian producers in the power, steel, chemical, and agricultural equipment sectors had expressed their interest in setting up projects in Egypt.
According to media reports, while India invested $3.15 billion last year in Egypt, it could have invested as much as $700 million over the next few years.
What is the significance of Egypt?
In the first few decades following our independence, India has had an exceptional relationship with a country whose population is nearly 110 million and its location lies between Africa and Asia.
Over the past two years, both countries have been working together at critical junctures. During his presidency in India, Prime Minister Narendra Modi had worked towards strengthening relations with Egypt even inviting it to the G20 Summit as a special guest. The visits of Defence Minister Rajnath Singh and External Affairs Minister Dr. S Jaishankar to Cairo in October last year have laid a solid foundation for the Prime Minister’s meeting in Cairo.
