by Mirza Abdul Aleem BAIG
The revival of the India-Middle East-Europe Economic Corridor (IMEC) is a significant development in global trade and geopolitics. Initially introduced at the G20 summit in Delhi in September 2023, the IMEC was envisioned as a strategic initiative to strengthen economic connectivity between India, the Middle East, and Europe.
The recent efforts to relaunch the project, marked by Prime Minister Narendra Modi’s discussions with U.S. President Donald Trump and a previous announcement in Marseille alongside French President Emmanuel Macron, underscore its importance.
France’s interest in positioning Marseille as a key hub in the western Mediterranean reflects Europe’s growing involvement. However, as with any grand economic initiative, the IMEC faces considerable geopolitical and financial hurdles that could determine its feasibility and long-term impact.
The Middle East remains a region of significant instability, and the IMEC’s success is deeply intertwined with the political landscape of this area. The ongoing Israel-Palestine conflict has further complicated regional relations. Saudi Arabia, a key participant in the IMEC, has made it clear that the normalization of relations with Israel is contingent on the establishment of a Palestinian state.
This condition places a considerable burden on the project’s viability, as the absence of Saudi support could severely weaken its prospects. Over and above, security threats from the Houthi rebels in the Red Sea pose another challenge. Even though the maritime route between India and the UAE does not pass through the Red Sea, regional instability can still disrupt crucial trade flows and infrastructure projects.
Beyond regional conflicts, IMEC also faces competition from China’s Belt and Road Initiative (BRI), particularly the China-Pakistan Economic Corridor (CPEC). China has aggressively expanded its influence through infrastructure investments, positioning itself as the dominant economic power in Asia and beyond.
The BRI, launched in 2013, aims to create a vast network of roads, railways, and maritime links to connect China with Africa, Europe, and the rest of Asia. The CPEC, a major component of the BRI, seeks to link China’s Xinjiang province to Pakistan’s Gwadar port, offering China a direct route to the Arabian Sea. While these projects have promised economic growth, they have also faced significant resistance due to concerns over debt sustainability, sovereignty issues, and security risks.
One of the biggest challenges for China’s BRI is the growing debt burden on participating countries. Nations like Sri Lanka, Pakistan, and several African states have struggled under the weight of Chinese loans, often forced to cede strategic assets when they fail to meet debt obligations.
Sri Lanka’s Hambantota Port, handed over to China on a 99-year lease due to the country’s inability to repay its debt, stands as a stark warning to others. Pakistan, a major beneficiary of the CPEC, is also grappling with economic instability and a debt crisis, raising concerns about its long-term viability. What’s more, China’s increasing control over critical infrastructure has fueled fears of neocolonialism, prompting many countries to reassess their participation in BRI projects.
The IMEC, in contrast, offers an alternative economic model that prioritizes multilateral cooperation and diversified investments. Unlike China’s state-driven approach, which often leads to debt dependency, the IMEC seeks to engage multiple stakeholders, including India, Europe, the United States, and Gulf nations, to create a more balanced and sustainable trade network.
The strategic involvement of the UAE and Saudi Arabia is particularly crucial, as these nations serve as key transit hubs connecting Asia to Europe. However, the exclusion of important regional players such as Egypt, Oman, and Turkey raises concerns about the corridor’s inclusivity. Egypt, which controls the vital Suez Canal, remains a particularly notable omission, as its participation could provide greater flexibility and alternative routes for global trade.
At the heart of the IMEC’s geopolitical significance is the evolving U.S.-India partnership, which seeks to counterbalance China’s growing influence. Over the past decade, India and the United States have deepened their economic and strategic ties, recognizing shared interests in maintaining a rules-based international order.
The IMEC aligns with Washington’s broader Indo-Pacific strategy, which aims to contain China’s expansionist policies and secure critical trade routes. By supporting the IMEC, the United States not only strengthens its economic engagement in the region but also reinforces India’s role as a global trade powerhouse. This partnership stands in stark contrast to China’s bilateral deals, which often prioritize Beijing’s interests at the expense of local economies.
India’s strategic ambitions are also a driving force behind the IMEC’s resurgence. As one of the world’s fastest-growing economies, India is eager to establish itself as a major global manufacturing and trade hub. The corridor provides India with an opportunity to enhance its connectivity with European markets while reducing its reliance on Chinese-dominated supply chains.
By investing in new port terminals, railway links, and digital infrastructure, India can position itself as a central player in the global trade ecosystem. The corridor also offers significant energy security benefits, allowing India to streamline its access to Middle Eastern oil and gas resources.
Despite its potential, the IMEC must address several financial uncertainties. While Saudi Arabia has pledged $20 billion to the initiative, broader investment commitments remain unclear. Estimates suggest that each component of the corridor could require between $3 to $8 billion, raising questions about funding sources and long-term financial sustainability. Given the scale of the project, securing private sector investment will be essential to ensure its success.
Into the bargain, logistical challenges, such as standardizing rail gauge systems and customs regulations across multiple countries, must be overcome to facilitate seamless trade. In many ways, the IMEC represents a strategic counterweight to China’s BRI, offering a more transparent and collaborative approach to global trade. However, its success hinges on the ability of participating nations to navigate complex geopolitical realities and foster inclusive partnerships.
The IMEC’s potential to reshape global trade is undeniable, but realizing this vision requires careful planning, sustained investment, and above all, regional stability. As the world watches the IMEC’s progress, its impact on the broader geopolitical landscape will be closely scrutinized, shaping the future of economic connectivity in the decades to come.
Author: Mirza Abdul Aleem Baig is President of Strategic Science Advisory Council (SSAC) – Pakistan. He is an independent observer of global dynamics, with a deep interest in the intricate working of techno-geopolitics, exploring how science & technology, international relations, foreign policy and strategic alliances shape the emerging world order.
This article reflects the author’s own opinions and not necessarily the views of Global Connectivities.
