With uncertainty gripping the ambitious India-Middle East EU Economic Corridor (IMEC) project due to the deepening of the West Asia crisis, India is examining the possibility of beginning work on the eastern leg of the corridor. This would take container traffic from India to the UAE, which could later be extended once there was relative peace in the Middle East, sources have said.
“India and other partners of the IMEC have a lot riding on the project. It will be a pity if the project, the estimated cost may be about $20 billion, languishes till the Middle East crisis is over. One view is to do as much work as possible on the trade corridor now and leave the rest for later. The India-UAE leg is the first one that may be worked on,” an official tracking the matter told businessline.
The office of the National Security Advisor and the Ministry of External Affairs are examining the feasibility of working on the India-UAE leg to begin with, the official added.
Trade Highway
The IMEC, a proposed 4,800 km long route comprising a railroad, ship-to-rail networks, and road transport routes extending across two corridors, was announced in September 2023 in New Delhi on the sidelines of the G20 Summit. This followed a meeting between the leaders of India, the US, the United Arab Emirates, Saudi Arabia, Italy, France, Germany, and the European Commission.
“It intends to increase efficiency, reduce costs, secure regional supply chains, increase trade accessibility, enhance economic cooperation, generate jobs, and lower greenhouse gas emissions, resulting in a transformative integration of Asia, Europe, and the Middle East,” according to the MEA.
Strategically, the IMEC is viewed as a counter to China’s intercontinental Belt and Road Initiative (BRI), although its scale and scope are relatively limited.
Diplomatic Hurdles
“While working on the India-UAE leg could be a good idea to get things started, one needs to understand that a significant part of the corridor runs through Saudi Arabia. It will be difficult to get Saudi Arabia involved in the project till the Israel and West Bank issue is sorted out,” the source said.
External Affairs Minister S Jaishankar recently said at a media interaction that the delay in implementation of the IMEC because of the current situation in West Asia was a matter of “concern.” However, he added that all the parties to the agreement had reconfirmed their commitment to it.