India Steps Up in Ethiopia’s Rail Development as China Grabs Key Projects

Ethiopia, a strategic country in the Horn of Africa with historic ties to India spanning nearly 2,000 years, is witnessing significant infrastructure development in which both India and China are actively involved. Indian Prime Minister Narendra Modi is scheduled to visit Ethiopia on 16–17 December, marking his third trip to Africa this year and reinforcing India’s role as a key partner for the Global South.

India’s Contribution to Ethiopian Railways

India has played a crucial role in Ethiopia’s railway development, offering:

• Financial support through concessional loans exceeding $1 billion
• Technical expertise via RITES (Rail India Technical and Economic Services)
• Supply of locomotives and train coaches

RITES conducted feasibility studies, track-laying plans, and electrification assessments for Ethiopian railways. Indian exports of locomotives and rail parts complement regional infrastructure development, while China has handled some of the major lines like the Addis Ababa–Djibouti railway, primarily due to delays in India’s loan approval process.

Historic India–Ethiopia Relations

India and Ethiopia share a long-standing relationship, evolving from anti-colonial solidarity to political, economic, and social collaboration. India has consistently supported African representation in international platforms, including advocating for the African Union’s inclusion in the G-20, strengthening India–Africa ties. Since the India–Africa Forum Summits (IAFS) initiated in 2008, both nations have deepened political and diplomatic relations.

Demographics and Strategic Context

Ethiopia is a Christian-majority country (60–70%), primarily Ethiopian Orthodox, with Islam representing 30–34%. The largest ethnic groups are Oromo (35–40%) and Amhara (27%), predominantly inhabiting the highlands.

Despite China’s strong presence in Ethiopian railway projects, India remains a key partner, particularly in:

• Rail component supply and locomotive manufacturing
• Technical and operational consultancy
• Infrastructure projects including electrification and dry ports

Economic and Trade Relations

India is Ethiopia’s second-largest trading partner. According to the Indian Ministry of Commerce, bilateral trade in 2023–24 stood at $571.52 million, with India exporting $489.59 million worth of goods (including iron and steel products, pharmaceuticals, machinery, and equipment) and importing $81.93 million worth of commodities (pulses, precious and semi-precious stones, vegetables, seeds, leather, and spices).

India also provides capacity-building support through technical training, grants, and concessional loans, reinforcing its status as a significant economic partner.

Strategic Implications

The competition between India and China in Ethiopia’s railway and infrastructure sectors highlights strategic rivalry and partnership opportunities in Africa. While China has secured some major projects, India’s long-term support and technical collaboration continue to strengthen its presence in Ethiopia, particularly in power, agriculture, and railway sectors.