The mega India Middle East Europe economic corridor (IMEC) covering the UAE, Saudi Arabia, US, France, Germany, Italy and the EU, will be a strategic and economic game changer for the Asian giant, said the country’s finance minister Niramala Sitharaman while presenting the Interim Budget 2024 today (February 1).

A first-of-its-kind initiative, IMEC was unveiled at the G20 summit which took place in India last year in September, where the host India joined hands with the US, UAE, Saudi Arabia, France, Germany, Italy and the European Union signing the strategic deal, which many see as a counter to China’s Belt Road Initiative.

The IMEC comprises two separate corridors, the East corridor connecting India to West Asia/Middle East and the Northern corridor connecting West Asia/Middle East to Europe.

It will include a rail line, which, upon completion, will provide a reliable and cost-effective cross-border ship-to-rail transit network to supplement the existing multi-modal transport routes enhancing transhipment of goods and services from South East Asia through India to West Asia/Middle East Europe.

“The recently announced IMEC is a strategic and economic game changer for India and others. In the words of Hon’ble Prime Minister, the corridor “will become the basis of world trade for hundreds of years to come, and history will remember that this corridor was initiated on Indian soil”, stated Sitharaman.

Her remarks came a day after India’s President Droupadi Murmu, in her ceremonial address to the parliament ahead of the budget session, hailed the IMEC as an ambitious connectivity initiative. “This corridor will further strengthen India’s maritime capability,” President Murmu said.

The IMEC is the latest in the series of connectivity projects that India is looking to strategically and economically leverage, apart from the North-South International Corridor, and the Chennai-Vladivostok project.

Last year in October, US President Joe Biden described the IMEC as connectivity project aimed at building a “better future for the Middle East”, and the one that will make West Asia “more stable, better connected to its neighbours”.

Biden further added that with the “innovative projects such as India-Middle East-Europe economic corridor that we announced earlier this year in the summit of the world’s biggest economies”, the region will benefit with “predictable markets, more employment, less rage, and less grievances.”

According to experts, the corridor deal hopes to integrate India’s vast market of 1.4 billion people with countries to the west, offer a counterweight to Chinese infrastructure spending, boost Middle Eastern economies and help normalise relations between Israel and Gulf states.

Sitharaman underlined that the Modi government was guided by the principle ‘reform, perform, and transform’.

“Our vision for ‘Viksit Bharat’ is that of “Prosperous Bharat in harmony with nature, with modern infrastructure, and providing opportunities for all citizens and all regions to reach their potential,” added the minister.