Daily Times

The India-Middle East-Europe Economic Corridor (IMEEC) is a proposed trade and investment initiative designed to connect India, the Middle East, and Europe. This corridor holds great potential for fostering economic growth and cooperation in these regions while serving as a counterbalance to China’s expansive Belt and Road Initiative (BRI).

The origins of the IMEEC project trace back to the 2016 G20 summit in Hangzhou, China, where leaders of India and the United Arab Emirates (UAE) agreed to collaborate on establishing a trade and investment corridor. Subsequent agreements followed, involving India and other regional countries like Saudi Arabia, Israel, and Jordan.

The IMEEC project carries substantial political and economic significance. It seeks to strengthen trade and investment ties between India and the rapidly growing economies of the Middle East and optimise European economies, while enhancing connectivity within these regions, potentially fostering cooperation in various sectors, including energy, transportation, and tourism. Regionally, the IMEEC project aims to create a new economic and trade bloc in the Middle East and South Asia, which could reduce the region’s dependence on China and promote improved stability.

Building the India-Middle East-Europe Economic Corridor (IMEEC) could indeed provide India with a significant opportunity to gain traction against China for several strategic reasons. The IMEEC project is often seen as India’s response to China’s Belt and Road Initiative (BRI), which has expanded China’s influence across Asia, Africa, and Europe. By establishing IMEEC, India aims to create its own economic and strategic corridor, countering China’s growing sway in the region. It would enhance India’s connectivity with the Middle East and Europe, two economically vibrant regions. This connectivity would open up new trade routes and markets for Indian goods and services, helping India diversify its trade partners and reduce dependence on China. The Middle East is a major source of India’s energy imports. IMEEC could strengthen India’s energy security by facilitating the transportation of oil and gas resources from the Middle East. It would also provide alternative routes for energy imports, reducing reliance on China-dominated sea routes.

IMEEC could strengthen India’s strategic partnerships with countries in the Middle East and Europe. Enhanced economic ties could lead to deeper security cooperation, benefiting India’s security interests in the region. The project’s infrastructure development and increased trade would boost economic growth in India. This growth would translate into more jobs and increased revenue, further solidifying India’s position as a regional economic power. India has a substantial trade deficit with China.

By diversifying its trade partners through IMEEC, India could potentially reduce this imbalance. A successfully implemented IMEEC could enhance India’s global influence and reputation as a proponent of sustainable and equitable development, countering some of the criticisms directed at the BRI. IMEEC provides an alternative infrastructure network that aligns with India’s interests. This could encourage other countries, including those wary of the BRI, to participate, bolstering India’s position as a leader in the region.

India’s participation in the IMEEC project allows it to exert political leverage and negotiate favourable terms, strengthening its position in regional and international forums. However, the successful realization of these benefits depends on effective planning, investment, and cooperation with participating countries.

The anticipated cost of the project is expected to reach billions of dollars, although the exact funding mechanisms remain undetermined. The project is envisioned to involve the construction of new transportation infrastructure like roads, railways, and ports, in addition to the improvement of existing facilities.

The financing of the IMEEC project is anticipated to involve a combination of public and private investments. Governments of participating countries are likely to contribute some funding, but the majority of the financing is expected to come from private investors.

Several potential sources of financing for the project include Public funding from the governments of participating countries, Private investment from commercial banks, investment funds, and other financial institutions, Grants from international organizations such as the World Bank and the Asian Development Bank, Concessional loans from governments and financial institutions and blended finance arrangements that combine public and private funding.

In terms of the United States, the project serves as a strategic response to China’s BRI, aiming to provide an alternative and sustainable approach to infrastructure development while countering China’s influence in the region. The project, once realized, could lead to new markets for American products and services, generate employment opportunities, promote economic growth, and contribute to the vitality of American businesses.

Enhanced connectivity with the Middle East and Europe could make Pakistan an attractive destination for foreign investment and tourism.

The possibility of the Belt and Road Initiative (BRI) and the India-Middle East-Europe Economic Corridor (IMEEC) joining forces and connecting presents an intriguing prospect. Both projects share common goals of promoting economic growth and connectivity, and they could complement each other by creating an extensive global network of infrastructure.

The BRI, spanning over 60 countries across Asia, Africa, and Europe, involves the construction of roads, railways, ports, and other infrastructure, primarily connecting China to Europe and Africa. In contrast, the IMEEC is more focused on strengthening connectivity between India, the Middle East, and Europe.

The convergence of the BRI and IMEEC could create a vast interconnected network of infrastructure, simplifying the movement of people and goods between different countries and boosting global trade and economic growth. Realizing this vision would require addressing several challenges. It would require extensive coordination to merge the two projects effectively to ensure compatibility between the BRI and IMEEC networks. Determining how to finance such an ambitious endeavour would be a complex task. Public and private investment, as well as international cooperation, would be vital. The combined projects would need to incorporate stringent environmental safeguards to minimize adverse impacts.

While joining the BRI and IMEEC presents significant potential benefits, such as facilitating global trade and cooperation, it also comes with substantial challenges. Nonetheless, the prospect of creating a comprehensive global infrastructure network is an exciting concept that could reshape the world’s economic and geopolitical landscape. Careful planning and international cooperation would be crucial to realizing this vision successfully.

Despite not being a member of the G20, Pakistan stands to benefit from the IMEEC project in various ways. It could create new avenues for trade and investment for Pakistan. Pakistani businesses might export goods and services to the participating countries in the region, while foreign investors could find opportunities to invest in Pakistan, capitalizing on the project’s developments. Enhanced connectivity with the Middle East and Europe could make Pakistan an attractive destination for foreign investment and tourism. Better infrastructure and transportation links could facilitate the flow of people and goods, benefiting various sectors of the economy. The construction and operation of new infrastructure could generate employment opportunities for Pakistani workers.

For Pakistan, the IMEEC project holds the promise of unique advantages. Unlike other member countries, Pakistan may not need substantial investments in constructing roads, bridges, and ports, thanks to its already established world-class road and communication network under the China-Pakistan Economic Corridor (CPEC). The potential integration of CPEC with the IMEEC project could be a game-changer.

Such integration has the power to invigorate trade and investment between Pakistan and the participating IMEEC countries, igniting job creation and ushering in new opportunities for Pakistani businesses and the labor force. Furthermore, the strategic positioning of Pakistan within this network would significantly expand its reach to regional nations, the Middle East, and Europe.

When combined with the existing connectivity to sixty countries through the Belt and Road Initiative (BRI), Pakistan could enjoy a remarkable advantage over member countries in both these influential corridors. However, realizing this potential would require astute political, economic, and financial strategies, alongside effective communication and diplomatic skills. Pakistan’s role in this evolving landscape could be transformative if played wisely.

The writer is a former press secretary to the President and former press minister to the Embassy of Pakistan to France.