A strategic partnership: Why PM Modi’s Ethiopia visit matters

To sip a cup of single-origin Ethiopian highland coffee is to experience a dizzying complexity of flavours, from bright, floral notes to a deep, wine-like body. So it is with Ethiopia itself: a nation of intoxicating potential and confounding bitterness. India will have to read the coffee beans in a new endeavour in diplomacy, with unknown aromas outside the comforts of the more predictable tea leaves.

Clearly, India seems ready for the risk. Prime Minister Narendra Modi and his Ethiopian counterpart, Abiy Ahmed Ali, have added heft to the partnership by lifting it two notches to a strategic partnership. India is here upfront in Addis Ababa with a BRICS member as a partner of the Global South. The Ethiopians started this tour on a very positive note by conferring on PM Modi the ‘Great Honor of the Nishan of Ethiopia’, a rare gesture bestowing their highest civilian honour.

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This visit comes portside as India takes the chair of BRICS in 2026.

But as the limousines glide through the capital, the rumble of artillery from the civil war is audible in the distance.

India, as great powers must, is doubling down on a bet it has been making for over 15 years: that Ethiopia’s promise as an economic powerhouse will eventually outweigh its predilection for fratricide. It is a wager of some $5 billion in accumulated direct investments.

The economic logic of the visit is sound. India is now Ethiopia’s second-largest trading partner, a position built on a steady flow of goods that keeps the Ethiopian engine humming. The manifest of this relationship is dominated by three main categories: Indian exports of machinery, which power Ethiopia’s nascent industrial parks; agricultural goods, vital for a nation prone to food insecurity; and pharmaceuticals, the lifeblood of its healthcare system.

India has a massive $5 billion invested in Ethiopian soil. The footprint is distinct and industrial. Raymond, the Indian textile giant, operates a massive garmenting facility in the Hawassa Industrial Park, stitching suits for American boardrooms. Cadila Pharma has a long-standing formulation plant in the country. Kanoria Africa Textiles, another heavyweight, churns out denim in Bishoftu. These are not portfolio flutters; they are factories made of brick, mortar, and optimism.

There is also Indian diplomatic generosity. India has extended nearly $1 billion in soft lines of credit to light up rural homes and lay railway tracks. The flagship Ethio–Djibouti railway and various sugar projects have been beneficiaries. Yet, as any banker in Mumbai will privately admit, these are loans that may never be fully repaid — in full. It’s the cost of doing geopolitics, a sort of price of admission to the Horn’s strategic club.

Politically, the embrace is tightening. India was a vocal cheerleader for Ethiopia’s entry into the BRICS club earlier this year, a move intended to dilute Western hegemony and give the Horn of Africa a seat at the top table. For PM Abiy Ahmed, whose liberalisation agenda — opening up the banking and telecoms sectors — offers a tantalising glimpse of a potential African tiger economy, PM Modi’s support is a vital geopolitical crutch. For the risk-takers in India, these reforms smell of opportunity. Already, India on this trip has announced the setting up of a data centre.

But the smell of cordite is stronger. The resurgence of civil war threatens to undo everything. The cessation of the Tigray conflict has merely made way for a new, perhaps more dangerous, conflagration in the Amhara region. The Amhara rebellion is no longer a ragtag annoyance; it is a serious existential threat to the federal state. If Addis Ababa falls into a prolonged siege or the trade corridors are severed, India’s $5 billion bet could be compromised.

It is a grim irony that this violence is unfolding in the very place where violence began. Ethiopia is the cradle of humanity; the Omo remains found here date the origin of Homo sapiens to roughly 200,000 years ago. In the intervening two hundred millennia, we have invented the steam engine, the microchip, and gone to the moon. But life in Ethiopia is still, to paraphrase Hobbes, nasty, brutish, and short. They have been fighting almost from day one of humanity. It boggles the mind and, more practically, ups engagement risks.

As an emerging power with global ambitions, India does the right thing by taking this risk. To shy away from the Horn of Africa’s complexities would be to abandon the field to others. PM Modi’s wager is that India’s capital, diplomacy, and its model of developmental partnership can mitigate Ethiopian conflicts. New Delhi could prove to be the sugar that balances the brew, enriching the final cup for both nations. Or it could be scalded, left only with a bitter taste from a high-stakes investment gone sour. Great powers take that risk.

(The writer is a senior journalist with expertise in defence. Views expressed are personal and do not necessarily reflect those of Firstpost.)