India in the Sahel

GOING by the World Bank 2026 GDP by Country Report, Nigeria will be the 21st biggest economy in the world at a GDP of $1 trillion, coming slightly below Poland and above Taiwan. That is if all the countries on the list record no growth till 2023 (the target year for the Nigerian ambition) and without adjusting for inflation.

If this ambition is achieved, Nigeria will be probably around the 30th, moving from the current position of 48th. Many economists already doubt the $1 trillion ambition, given the growth rate even for the past three years and the structural deficiencies in the economy.

But GDP, sometimes, is just a number. At $1 trillion economy, assuming population sustains the current growth trajectory, and lands at 250 million by 2030, per capita income will be around $4,000.

Only India, which is the sixth largest economy (according to the World Bank estimate) at GDP of $4.2 trillion is the only one within the same per capita income threshold. The per capita income of India is presently around $2,900 while Nigeria is $1,500. A more than 100% growth in per capita income in five years will spike the needle. But can Nigeria learn anything from India, which has a very strong demographic similarity?

Democracy is older in India, and has perhaps been more stable, than Nigeria. But ethnic nationalism around politics is equally strong. In the last few years, India has been able to build a strong export sector around ICT services and manufacturing, areas in which Nigeria is still lagging. Export is currently 25% of India’s GDP compared to 13% in Nigeria. Also, most of India’s exports are around manufacturing and agriculture compared to Nigeria where oil dominates.

India hardly suffers a volatile foreign exchange and interest rate market. Inflation has been less than double digit in the past five years while the rupee has not moved beyond 100 rupees to the dollar.

Beyond goods and services, no nation perhaps exports human capital as much as India. Official records suggest a Diaspora population of over 40 million people, the highest in the world. Some people believe the figure is higher as many Indians working in the fringes of developed may not have been captured.

The strength of the Indian Diaspora population may not however be its number but how the benefits are mined in terms of knowledge sharing and technology transfer. The bosses of Microsoft, Google, Microsoft, PepsiCo and several Fortune 500 companies, at one time or the other, were people of Indian origin. Nigeria does has not produced one person in that category. The support system and knowledge transfer provided by these global personalities helps to foster the development of local base which India has perhaps used this to a significant advantage.

The Nigerian government has lately been struggling to integrate its Diaspora population into the local economy through its Foreign Affairs Ministry. The Muhammadu Buhari administration even created the Nigerian Diaspora Commission (NIDCOM) which the current government has sustained. But Diaspora benefits can only be tapped if the local base is strong enough to absorb remittances and knowledge flow. In that area, India does better.

India also has 10 companies in the Fortune 500. Africa, not to even talk of Nigeria, has none. A company, most probably the petroleum refinery, within the Dangote Group may perhaps bell the cat if it sustains its current investment momentum. A country hardly becomes a large economy, in the $1 trillion threshold, without large, globalized companies and multinationals with active commercial operations in rich world markets. The ability to tap into high income markets, that companies like Samsung or Toyota, are able to do would be critical for a high GDP status. This position is supported by data: no country among the economies is not represented in the Fortune 500 club.