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IMEC-EC

  1. News

    1. It is one of the Side Deal under G20

  2. Quotes

    1. PM said we are sowing the seeds for future generation to dream bigger
    2. US Prez said that its a big deal

  3. Connectivity Diplomacy (Economic Corridor & Its Significance)

    1. Also called as Transit or Infrastructure Diplomacy

    2. It is use of Diplomatic Means to Foster International Cooperation in the domains of Transportation, Infrastructure etc

    3. Book Connectography by Geo Political Strategist and Expert - Parag Khanna → he says that we are accelerating into a future, shaped less by countries than by connectivity.

      He Further argues mankind has a new maxim that connectivity is destiny and the most connected powers and people will win

    4. Infra projects are becoming key sites of diplomatic engagement, competition and influence

    5. Examples of IMEC

      1. BRI - Belt & Road Initiative
      2. INSTC - International North South Transport Corridor (Mumbai to Moscow)
      3. IMT Trilateral Highway
      4. BBIN - Bangladesh Bhutan India Nepal Initiative
      5. Kaladan Multi Modal Transit Projects
      6. IMEC

  4. What is IMEC-EC (India Middle East Europe Economic Corridor)

    1. It is a Multi National and Multi Regional, Geo Economic (Trade) & Geo Strategic (countering Chinese influence → Italy is planning to withdraw from BRI)

      BRI Model is that of → Debt Trap Diplomacy → BRI has now become a PREDATORY REAL ESTATE Project for China

      Multi Modal Transit Project → Rail Shipping Route Connecting → India UAE Saudi Arabia Jordan Israel Greece and Europe

      It is based on Two Corridors

      1. Eastern Corridor → India to Gulf
      2. Northern Corridor → Gulf to Europe

    2. IMEC is considered to be an Extension of B3W & PGI by G7 post covid lockdown (B3W is Build Back Better World && PGI is partnership for global infrastructure)

      They both were alternatives to counter BRI’s Opaqueness as they both were Transparent

      It is Trans Continental

  5. Significance

    • Economic Corridor

      Diagram

      Screenshot 2023-12-11 at 11.41.49 AM.png
      1. Will help in reducing Transit time
      2. Hence Increased Trade
      3. Hence Increased Income
      4. Hence Reduced Poverty & Over All Economic Development

      Features

      1. Reduced Transit Time, Current route to Europe is via Suez Canal of Egypt → Its an All Shipping Route. Currently it takes 11 days from JLN Port Mumbai to Suez

        as per projection, under proposed IMEC, From India to Dubai (Jabal Ali) to Saudi & Israel (Haifa Port)

        JLN to Dammam 6 Days, from Dammam to Haifa 24 Hours → Hence via new route of IMEC 3 to 4 days will be saved

        It is 2 way connectivity hence it will benefit nodal countries as well

      2. It also links major ports → it is Ship Rail Route, It will link Kochi and Mundra too

      3. Its a boost for Indian Railways, as it is a Ship Rail Connectivity → It will help Indian Railway to get contacts. For Example : PSU like IRCON Indian Railway Construction International Limited

        IRCON has projects in Malaysia and Chabahar

      4. Complements Existing Corridors like IMT INSTC etc

      5. GCC Countries can Recapitalised NDB

    • Geo Political

      1. Counter to Chinas BRI (infrastructure connectivity project of china, but it is considered as a martial plan, it has 2 obj → on the stage objective and behind the stage objective)

        BRI is leading to Debt Trap, more than 150 joined this BRI and more than 1 Trillion invested

        Countries are getting into Debt Trap because they need this infra but the investment is being provided by China. BRI is not transparent, it is creating aversion in the minds of people, hence China renamed it as GDI Global Development Initiative which chain tried to paint as cleaner and greener

        Here IMEC EC is a good alternative to Chinese BRI

      2. US Regional Presence

        US and its allies (GCC) are concerned about De Prioritisation of South Asia. Here SA is seeking Defence Umbrella Support from US to normalise its relations with Israel

        It is also an extension of Abraham Accords, Mediated by US and signed US Bahrain and Israel to normalise the Ties between Arab Countries and Israel

        It is also an Extension of I2U2

        US wants to steer away countries in the region including India from INSTC (Iran Russia Included, Hence US wants to take them away from here)

      3. IMEC shows Indian Proactive Foreign Policy unlike earlier being reactive

        This shows Indian Commitment to Multi Lateralism and Multi Polarity and Middle Path (by Multi Aligning)

      4. Supports other Indian Connectivity measures like Chabahar Port in Iran

      5. India can also become a Physical Hub in the Region from South East Asia to India to Euorpe → Also India Signed MoU of Strategic Partnership with Nodal countries of KSA, UAE, Israel and Greece - India has signed

        KSA is fourth largest trading partner of India, India is Fourth Largest Energy Supplies because of Cheap Russian Oil

        India UAE signed a FTA last year and this is also in synergy for Energy Opportunities, Gulf is significant for Indian Diaspora

        Partnership between India and Greece has been recently elevated to Strategic Partnership → Greece is Gateway to Europe

      6. This also provides scope for Normal KSA & Israel Diplomatic Relationship

    • Environmental

      1. Waterways and Railways are more cleaner and greener

    • Collaborative Project

      1. Unlike BRI it is a Collaborative Project
      2. It is more transparent
      3. It is more uniform in approach and action and promotes standardisation

  6. Challenges

    1. EC need huge investment and long gestation period

    2. Need of Industrial Bases & Commercial Hubs along the Economic Corridor

    3. Need for Manufacturing or per say over all global value chain around Economic Corridors

      Examples is of Chinese SEZ has associated Global Value Chain unlike Indian SEZ

      All these things present together will help in Transformation of Region

    4. Need for Hybrid Financing - Example is China BRI has seen investment of 1 trillion with more than 150 countries have invested in it

    Geopolitical Challenges

    1. BRI is already established, will be tough to counter
    2. Chinese presence along the route. Piraeus, is owned by Chinese Government Company i.e China Ocean Shipping Company
    3. Egypts Potential Loss on the Suez Canal Front
    4. Complexity in Middle East Relationship - many challenges in the region, security issues, traditional and non traditional threats

    Economic Challenges

    1. Funding - It has both Brown Field and Green Field Projects → Hence, we need huge funding → How ? will there by more toll, it it economically viable ?
    2. Issue of Difficulty in integrating with global value chains
    3. Private Ports - Haifa Pvt Ports is controlled by Adani in Israel. Mundra is also pvt port. There fees and usage structure may vary, this will not be hence UNIFORM, which is an Issue
    4. Handling Cost cuz it varies in Ship and Rail and Inland
    5. Logistical Challenges

  7. Way Forward

    1. Hybrid Financing

    2. Use this route to lay down Gas Pipeline

      Need for dedicated gas pipeline but TAPI (The Turkmenistan–Afghanistan–Pakistan–India) and IPI (Iran–Pakistan gas) is still pending

    3. Continuation of Other Projects → IMEC ke chakkar main baaki band nahin kar dena, nahin toh MM MM MM work nahin karega

  8. Question

    1. How does the Initiation of IMEC EC Impact Indian Strategic Interest in the Middle East and Europe
      1. Context
      2. What is IMEC
      3. Strategic Interest in Middle East and Europe
      4. Challenges
      5. Way Forward
      6. Map if Time Permits