India–Africa Cooperation: A Potential Driver for a Development-Oriented Energy Transition

Spotlight

• Africa attracts just 3 percent of global energy investments, despite holding nearly a fifth of the world’s population, with over 600 million people in the continent without electricity.
• Concessional financing, capacity building, and decentralised solar technology from India offer its African partners a template distinct from both Western climate pledges and Chinese infrastructure funding.
• South Africa’s industrial hydrogen ambitions and Ethiopia’s rural electrification drive illustrate two complementary faces of India–Africa energy cooperation, with BRICS serving as an enabling platform.

Africa, despite being home to nearly a fifth of humanity, remains underrepresented in the energy transition narrative. The International Energy Agency (IEA) has repeatedly flagged that the continent attracts only around 3 percent of global energy investment, even though it needs more than US$200 billion annually by 2030 to meet its development and climate goals.

More than 600 million Africans still live without electricity, and the cost of capital for African energy projects runs up to four times higher than in Organisation for Economic Co-operation and Development (OECD) economies, due to higher interest rates on borrowed capital. While energy transitions are generally framed around emissions reduction, Africa’s must also be assessed against the more basic development challenge it is trying to solve.

A reinvigorated India–Africa partnership can help close this gap. India achieved over 50 percent non-fossil share in installed electric power capacity five years ahead of its Nationally Determined Contribution (NDC) (2031–2035) target and expanded its solar module production capacity to approximately 172 gigawatts (GW) per annum. It therefore has considerable experience in scaling renewable energy deployment. Additionally, an important outcome of India’s BRICS 2026 presidency was the Energy Ministers’ Joint Communiqué during the 11th BRICS Energy Ministers’ Meeting in June 2026, in which BRICS countries, including South Africa and Ethiopia, emphasised on strengthening cooperation in the areas of energy security, sustainability, innovation, resilient infrastructure and capacity building.

India–Africa trade has grown to around US$82–100 billion a year in two decades; India’s cumulative investment in the African continent stands near US$80 billion since 1996; and New Delhi has extended over 190 Lines of Credit (LOCs) worth more than US$10 billion to 41 African countries, much of it channelled into power, transmission, and rural electrification. These growing economic and institutional ties provide a strong foundation for expanding India–Africa cooperation in support of a more development-oriented energy transition.

A Distinct Development Model

India’s energy partnerships with South Africa and Ethiopia offer a practical pathway to strengthen broader India–Africa cooperation. India’s development cooperation is exportable on two fronts.

First is its financing architecture. What separates India from Africa’s other external partners is more the form of capital than the scale. India’s financing runs through concessional LOCs under the Indian Development and Economic Assistance Scheme, administered by the Exim Bank, alongside grant-based capacity-building through the Indian Technical and Economic Cooperation programme. This differs from the commercial loan-heavy but slow-disbursing climate finance packages of the Group of Seven (G7)-led Just Energy Transition Partnerships (JETP), and from the debt-financed mega-infrastructure associated with Chinese lending.

India’s financing runs through concessional LOCs under the Indian Development and Economic Assistance Scheme, administered by the Exim Bank, alongside grant-based capacity-building through the Indian Technical and Economic Cooperation programme.

Second are India’s technical programmes: the International Solar Alliance (ISA) founded by India and France now counts roughly 39 African countries, including Ethiopia, among its members, and is actively promoting India’s own PM-Surya Ghar rooftop solar and PM-KUSUM decentralised irrigation schemes as replicable models for African electrification, enabling South–South cooperation and accelerating global solar adoption. Through instruments such as the MIGA-ISA Solar Facility and a partnership with the African Development Bank’s Desert to Power initiative, India is positioning itself less as a builder of large plants and more as a supplier of de-risking finance and decentralised, off-grid technology suited to Africa’s dispersed and under-electrified populations.

South Africa: An Industrial Peer

South Africa illustrates the industrial face of this cooperation. Being fellow BRICS members, India and South Africa engage as peers rather than as donor and recipient. Meetings in 2026 between Indian External Affairs Minister S. Jaishankar and South African Deputy President Paulus Mashatile have identified renewable energy, green hydrogen, and critical minerals as emerging pillars, alongside older ties in trade and investment.

South Africa’s 2021 hydrogen valley feasibility study, built around its platinum-group metals (PGMs) used in electrolysers, dovetails with India’s green hydrogen ambitions, which depend on imported electrolyser inputs and critical minerals. The India–Southern African Customs Union Preferential Trade Agreement signed in August 2026 also seeks to strengthen supply security for critical minerals, including platinum-group metals (PGMs), manganese, and copper—necessary inputs for India’s electric-vehicle battery and green-hydrogen ambitions.

A BRICS Science, Technology, and Innovation ministerial in India is expected to carry the technology development agenda forward, complementing the BRICS Joint Report on Hydrogen Value Chains 2026. The Joint Report provides a foundation for enhanced cooperation on hydrogen technologies and highlights India and South Africa as countries with high-quality solar and wind resources, suitable for scaling renewable-electrolytic routes.

South Africa’s transition also exposes the limits of treating decarbonisation as a purely technical exercise. Its Just Energy Transition Partnership (JETP), underwritten by an initial US$8.5 billion pledge from Western partners, has moved slowly on implementation, and researchers modelling its manufacturing sector describe a sustainability trilemma between rapid renewable deployment, continued industrial growth, and actual emissions reduction. This is where India’s peer-to-peer, industrial-minded engagement, rather than conditional climate finance, might gain more traction, because its development cooperation is based on the partner country’s needs and does not ask South Africa to choose between industrialisation and decarbonisation.

Ethiopia: A Development-State Partner

The India–Ethiopia story is framed around South–South capacity building rather than industrial parity. In December 2025, India and Ethiopia elevated their bilateral ties to a “strategic partnership,” aiming to cooperate in fields that included renewable energy and critical minerals. Ethiopia is, by New Delhi’s own reckoning, one of the largest recipients of Indian LOCs in Africa, including credit committed for power transmission infrastructure, and the number of Indian Technical and Economic Cooperation (ITEC) training slots offered to Ethiopian officials rose roughly tenfold over the past decade.

Ethiopia was also among the first countries to join the International Solar Alliance (ISA), with planned cooperation on rooftop solar, off-grid electrification, and solar-powered irrigation pumps. These are necessary in a country where over 45 percent of the population still lacks electricity access and the power grid remains roughly 90 percent hydropower-dependent, exposing it to drought risk.

India’s programmes such as PM Surya Ghar: Muft Bijli Yojana targets rooftop solar in 10 million households, with over four million rooftop solar systems installed as of August 2026.

Ethiopia’s own National Electrification Programme has aimed to move the country from roughly 30 percent electricity access in 2017 to universal electrification through a mix of grid extension and off-grid mini-grids—a segment where India’s decentralised solar experience is most transferable. India’s programmes such as PM Surya Ghar: Muft Bijli Yojana targets rooftop solar in 10 million households, with over four million rooftop solar systems installed as of August 2026. The PM-KUSUM initiative supports the adoption of solar energy in the agricultural sector through central government subsidies. India’s success in extending renewable energy to dispersed, low-income, weak-grid populations through such programmes offers policy learning in programme design and implementation mechanisms that can support Ethiopia’s efforts to expand electricity access.

The bilateral relationship has not been without friction, though. India’s LOCs to Ethiopia have not always translated smoothly into completed projects: in February 2024 the Government of India paid Exim Bank INR 9,013.72 crore after invoking sovereign guarantees on underperforming LOCs across several African markets.

India’s strength lies in the slower, technical work of capacity-building, off-grid electrification, and institutional training, areas where development-state models like Ethiopia’s still need assistance, and which complements rather than duplicates large-scale infrastructure finance from other BRICS partners.

Enabling Platforms

The India–Africa engagement runs through a dense set of channels—the India-Africa Forum Summit process, bilateral LOCs, and project-specific partnerships such as the collaboration between Africa50 and Power Grid Corporation of India on Kenya’s transmission network.

Multilateral platforms can further India–Africa cooperation by mobilising finance, facilitating technology transfer, and supporting institutional capacity building. As BRICS members, India, South Africa, and Ethiopia can tap into the New Development Bank (NDB) to finance renewable energy infrastructure and clean energy projects. For example, the NDB approved a US$180 million loan to South Africa’s Eskom electricity public utility in 2019 to support the Renewable Energy Integration and Transmission Augmentation Project.

Alongside financing, all three countries can utilise knowledge-sharing platforms to enhance technical expertise and facilitate cross-border cooperation. They can leverage the recently launched BRICS Digital Centre of Excellence for Smart Grids and Energy Storage under the Research Cooperation Platform, which will serve as a voluntary collaborative platform for knowledge sharing, capacity building, exchange of best practices, and development of pilot initiatives.

Additionally, India can expand cooperation on sustainable biofuels and clean-cooking solutions through the Global Biofuels Alliance, of which South Africa is a member. This could be particularly relevant for Ethiopia, where reliance on traditional biomass for cooking remains widespread. Similarly, the ‘One Sun, One World, One Grid’ initiative under the ISA can connect African partners with wider clean energy networks. The ISA’s partnership with AfDB to support its “Light up and power Africa” and “Desert to Power” initiatives to scale solar energy across the continent illustrates how multilateral platforms can translate technical cooperation into large-scale renewable energy deployment.

The India–Africa energy cooperation is a distinct, still relatively less-explored channel to close a financing and technology gap, the central obstacle to a development-oriented transition that can deliver both electrification and industrial growth. With India holding the BRICS presidency in 2026, it is an opportune time for the country to build upon its relations with Africa, especially member nations like South Africa and Ethiopia, with whom there is immense potential for such a development-oriented energy transition.

Chigozie Nweke-Eze is Postdoctoral Research Associate, School of Geography and the Environment, University of Oxford.

Parul Bakshi is Fellow, Energy and Climate, ORF Middle East.

The authors acknowledge the use of Claude Sonnet 5 to aid background research.