During the G20 Summit in New Delhi on September 9th, prominent world leaders unveiled an agreement that establishes a connection between the Europe, the Middle East and India. This economic corridor was formally endorsed by key stakeholders including the European Union, India, Saudi Arabia, The United Arab Emirates, the United States, and other G20 nations.
This significant pact has been introduced at a crucial juncture, as President Joe Biden of the United States aims to counterbalance with China’s Belt and Road initiative, positioning Washington as a viable alternative partner and investor for emerging nations within the G20 framework.
According to the deputy national security advisor told reporters at the annual summit in New Delhi, this agreement will have positive outcomes for low and middle-income nations in the area, while also positioning the Middle East as a significant player in the global business landscape.
Furthermore, it aims to link West Asian countries by railway and connect them to India by port. Additionally, it helps the flow of energy and trade from Gulf to Europe, as US officials have mentioned, by cutting shipping times, costs and energy use.
What is the deal?
The deal is being described as a groundbreaking regional investment that could mark the beginning of a new era of interconnectedness. It envisions the creation of a transcontinental network encompassing energy, maritime, railway, and data connections, with the goal of connecting India and Europe by way of the Arabian Peninsula.
This ambitious endeavor draws inspiration from the historical Red Sea route, which facilitated trade between India and the Roman Empire during the 1st and 2nd centuries CE and seeks to revive that ancient trade route.
While the comprehensive specifics of IMEC are still in the process of being defined, the initial aspects provide a clear indication of the project’s connectivity. This involves the establishment of two distinct corridors: one that links India to the Arabian Gulf (referred to as the East Corridor) and another that connects the Arabian Gulf to Europe (known as the Northern Corridor), as outlined in the MOU.
Although these geostrategic maneuvers are undeniably ambitious, albeit at its initial stage, the project has successfully brought the Arabian Gulf into the fold as a participant. This region is actively looking to broaden its economic portfolio.
The initiative is also actively seeking strong backing from both the United States and the European Union. In today’s multipolar world, these major powers see it as an opportunity to counterbalance China’s growing influence in the region. This project is an integral component of the Partnership of Global Infrastructure and Investment (PGII).
At the same time, the United States has a range of objectives, including efforts to guide India toward a path less influenced by Russia and Iran. This is particularly important in light of the complex situation surrounding the ‘North-South Transport Corridor.’