NEW DELHI: India-Middle-East-Europe Economic Corridor (IMEC) was launched at the G20 Leaders summit held in New Delhi in the year 2023. India took the lead and a Memorandum of Understanding (MoU) was signed by the US, Saudi Arabia, the United Arab Emirates, France, Germany, Italy and the European Union. It reflected India’s firm resolve to intensify economic development by building connectivity and enhancing economic integration between Asia, the Persian Gulf and Europe. The main objective of IMEC is to boost global trade by reducing transit time which in turn will lower costs and help boost economic ties among partnering countries.
India’s idea of IMEC came at a time when the world still was grappling with post pandemic crisis, inflation, economic recession and the larger geopolitical stress because of the ongoing conflicts. Though, the solutions to many of these challenges have not been that easy to find but India remained in the forefront to mobilise international public opinion and build consensus on the need to have collective responsibility for realizing the goals of IMEC. Whether India would be successful in its initiative is forming a major part of the debate. The way the IMEC is being planned, it will bypass the Houthi blockade. India and its partners are mainly looking for a supply chain which could avoid the Suez Canal. Though, it looks highly ambitious and very tough project, once realized, it will help integrate India, Europe and the Middle East (West Asia from India’s connotation) through UAE, Saudi Arabia, Jordan, Israel and the European Union.
It is being envisaged that the IMEC will have two separate corridors – the east corridor which will connect India to the Gulf and the northern corridor which will connect the Gulf with Europe. The Corridor would be able to secure regional supply chains and increase trade accessibility. Since IMEC involves multiple stakeholders and hence as a first step an Intergovernmental Framework Agreement (IGFA) between India and United Arab Emirates (UAE) was signed in February 2024 with a greater focus on enhancing cooperation on operationalizing the IMEC. The focus of IGFA has been mainly on the development and management of a logistics platform with a concentration on digital ecosystem as well as making provisions for supply chain services.
It must be emphasized here that the IMEC intends to mobilise $600 billion by 2027 mainly for addressing to the needs of infrastructure gaps among participating countries. There is no denying the fact that IMEC can be of great significance for partnering countries in managing maritime security and securing faster movements of goods between Europe and Asia. It is also anticipated that a fully operational IMEC will also enhance shipping capabilities and improve port infrastructure.
The IMEC will also create a more stable and secured environment in Middle Eastern countries which have always been under turmoil. India will certainly get benefitted from enhanced trade connectivity with Europe and its neighbours. It will also facilitate industrial development and improve access to the European market. There will certainly be significant increase in trade demand and supply across the region.
The way IMEC is being planned, it seems Europe will be the major beneficiary. This is the reason IMEC is being dubbed as an Eurasian alternative to China’s Belt and Road Initiative (BRI). The bandwidth of IMEC is very huge and it would help in integrating the economic system across the partnering countries. IMEC will connect the Arabian Sea to Jordan and Israel via railway through the Arabian Peninsula. By the time, IMEC would become operational, it would include three major Mediterranean ports – Haifa in Israel, Piraeus in Greece and Trieste in Italy. IMEC features on the top of radar when Italy formulates its economic plans. Italy has recently appointed a special envoy to oversee the country’s inclusion in IMEC. Italy has a goal of integrating Trieste into IMEC’s posr system. Italy’s exit from BRI is a testimony to their commitment to IMEC.
The progress made in realizing the goals of IMEC may look slow because of the ongoing Israel’s war with Hamas in Gaza, Houthi attacks on red Sea Shipping, unrest in most parts of west Asia and inherent tensions in Iran and Turkey. However, IMEC has captured the centre stage of the US diplomacy and builds upon the Abraham Accords that began during President Trump’s first term in office.
It is only because of China’s behavioural patterns and their fundamental goals, the rest of the world has been showing the sign of dissociating with them and hence there seems to be an emergence of geopolitical space which needed to be bridged with a degree of accountability. China’s debt trap diplomacy has been exposed to the members of international community.
India’s rise and its growing potential as a hub of manufacturing base and as a consumer market has provided a newer opportunity for the rest of the world to engage. India will create win-win situation for the world and certainly not a zero sum game. The EU and China may conclude a free trade agreement this year. India’s engagement with Greece and Italy will further get augmented and it is becoming clearer that both Greece and Italy are better positioned to gain from IMEC than France and Germany. Italy and Greece have four ports with a potential for expansion. India will have to work with all the members of IMEC and explore ways and mechanism to find convergences and bridge divergences among participating countries to make IMEC initiative a successful one. Dr Arvind Kumar is a Professor at School of International Studies, Jawaharlal Nehru University (JNU).