Far-reaching implications of the  India-Middle East-Europe Economic Corridor Prime Minister Narendra Modi (C), Saudi Arabia's Crown Prince and PM Mohammed bin Salman (L) and US President Joe Biden shake hands after unveiling the India – Middle East – Europe economic corridor project-AFP

A new acronym was minted in Delhi over the weekend: IMEC. On Saturday, Saudi Arabia, the UAE, India, France, Germany, Italy, the US and the EU signed a deal during G20 meetings in New Delhi to establish the India-Middle East-Europe Economic Corridor.The IMEC will comprise two separate corridors: the east corridor will connect India to the Arabian Gulf and the north corridor will connect the Gulf to Europe.

Addressing the IMEC summit, held in New Delhi on the sidelines of the G20 summit, US President Joe Biden said that “the world stands at an inflection point in history.” He described the new agreement as “historic.”

From a Gulf perspective, the new venture will solidify the region’s historical position as the primary trade route linking Asia, Europe and Africa. By emphasizing trade in energy, the project is banking on the region’s comparative advantage in providing cheap and reliable energy to the rest of the world.

The IMEC is expected to stimulate economic development through enhanced connectivity and economic integration between Asia, the Arabian Gulf and Europe. It is also likely to have far-reaching global economic implications beyond the three regions. 

The eight IMEC signatories account for about half of the world’s economy and 40 percent of its population. As such, they have the capacity to transform global trade and development if they are ready to commit the right resources.

The project could also have geopolitical implications, as it raises America’s profile in this region and enhances its role as a global player. Much has been said about the compatibility of this new US-led undertaking and China’s existing Belt and Road Initiative projects in the region, but looked at from a Gulf perspective it could be a win-win-win situation for China, the US and the Gulf countries through synergies of cooperation and integration. 

The cohabitation of the two ventures in the region could also help defuse tensions between the two superpowers. They may have to find a way to compete peacefully, at least in this region.

According to statements made by the IMEC’s principals, the corridor will include a railway that will provide a cost-effective, cross-border ship-to-rail transit network to supplement existing maritime and road transport routes. This will enable goods and services to transit to, from and between India, the Gulf and Europe. 

Along the railway route, the participants intend to enable the laying of cable for electricity and digital connectivity, as well as a pipeline for clean hydrogen export.

The IMEC founding countries are counting on it to secure regional supply chains, increase trade accessibility, improve trade facilitation and support an increased emphasis on environmental, social and governmental impacts. They expect it to increase efficiencies, reduce costs, enhance economic unity, generate jobs and lower greenhouse gas emissions — resulting in a transformative integration of Asia, Europe and the Gulf. —Arab News

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