The launch of the trans-continental India-Middle East-Europe Economic Corridor (IMEC) by India, the United States (US), the United Arab Emirates, Saudi Arabia, France, Germany, Italy and the European Union (EU) is the boldest geo-economic initiative the world has seen since China unveiled its Belt and Road Initiative (BRI) in 2013.
US President Joe Biden, Saudi Arabian PM and Crown Prince Mohammed bin Salman and PM Narendra Modi seen during the launch of the India-Middle East-Europe economic corridor.(AP)
US President Joe Biden, Saudi Arabian PM and Crown Prince Mohammed bin Salman and PM Narendra Modi seen during the launch of the India-Middle East-Europe economic corridor.(AP)
In scale, scope and impact, IMEC promises to be a game-changer as it brings together highly capable partner countries to pool resources and remake supply chains, production networks and zones of influence to make globalisation less China-centric.
US President Joe Biden’s remark at the inauguration of IMEC inNew Delhi that it is “a really big deal”, and Prime Minister (PM) Narendra Modi’s comment that “we are sowing the seeds for future generations to dream bigger”, both speak of the king-sized expectations about this new venture.
That so many parties have agreed to join hands and float IMEC indicates that each country and institution is convinced that its respective interests will be furthered through this project. For India, IMEC presents a means for faster trade, transport and infrastructural growth and for building a regional architecture with strategically aligned nations. Through its multimodal design of linking distant ports and criss-crossing several countries via ship, undersea cables, rail and road, IMEC can cut the time for economic exchanges between India and Europe by 40%. India’s exports of engineering goods, green hydrogen and green ammonia could emerge as key gainers under IMEC. If India’s free trade agreements with the Gulf Cooperation Council (GCC) and the EU come throug, IMEC will be a massive institutional catalyst for the economic fortunes of all three of these partners.
Key from an Indian perspective is that China has been excluded from IMEC. China tends to take centre stage, set the rules and standards and dominate economic flows wherever it is present, be it the BRI or the Regional Comprehensive Economic Partnership (RCEP). Some IMEC members remain part of BRI, but the former’s success can reduce the latter’s allure.
Geographically, the US is beyond the ambit of the IMEC’s area of operation. But diplomatically, Washington is a crucial driver of IMEC by knitting together a range of its formal allies and strategic partners across the three regions of Europe, the Middle East/West Asia and South Asia.
Questions about whether the US will invest vast sums of money to lubricate different wheels and nodes of the IMEC, and what might happen to its commitment to IMEC if an anti-multilateralist and anti-globalist politician like former President Donald rump returns to the White House in January 2025, are open ones. For the moment, steering of IMEC by the US is valuable because that is how transit countries like Jordan and Israel can be integrated with the rest. The pre-existing India-Israel-UAE-US (I2U2) grouping and the US’s strategic goal of getting Saudi Arabia to formally recognise Israel are tied to the IMEC idea.
Both the Americans and the Europeans see IMEC as part of the G7 group’s Partnership for Global Infrastructure and Investment (PGII), which was announced in 2022. With China far ahead in the game of geo-economic connectivity, the G7 nations have realised that they need to co-create workable international corridors of their own or risk forfeiting global influence and miss out on lucrative contracts for construction and network-laying to Chinese competitors. Italy’s PM Giorgia Meloni, who has formally conveyed to China that her country is quitting the BRI, said at the launch of IMEC that the PGII’s purpose is to support nfrastructural development in low- and middle-income countries “with an equal and non-predatory approach”. It was a not so subtle dig at China.
The beauty of IMEC is that it contains something attractive in it for all eight parties that have signed the founding Memorandum of Understanding. Undoubtedly, a multilateral cross-border and cross-oceanic connectivity endeavour requires painstaking diplomatic coordination and consensus management. Compared to China’s unilateral BRI, the IMEC may be slower as it is a relatively large-group undertaking with unpredictable internal dynamics such as electoral cycles in member countries. Yet, as the filmmaker Woody Allen put it, 80% of success is in showing up. India and its strategic partners are now present as a force on the geo-economic map through IMEC, and that is a positive start.
Sreeram Chaulia is dean, Jindal School of International Affairs. The views expressed are personal
