IMEC: India's Strategic Corridor for Economic Growth and Geopolitical Balance

The India-Middle East-Europe Economic Corridor (IMEC) is a strategic initiative to enhance connectivity, reduce logistical costs, and strengthen trade relations between India, the Middle East, and Europe. Launched amidst China's expanding influence in the region, IMEC serves as both an economic opportunity and a geopolitical counterbalance to China’s Belt and Road Initiative (BRI). While the project promises improved infrastructure and supply chain resilience, it faces significant hurdles, including regional conflicts, financial constraints, and geopolitical rivalries. With shifting global dynamics, particularly under the second Trump administration, the success of IMEC will depend on sustained cooperation, financial commitments, and regional stability.

A MENA Desk Commentary by Sharvari Patil | Edited by Aishik Goswami

President of the EU Ursula von der Leyen holds hands with Narendra Modi and Joe Biden at the Partnership for Global Infrastructure and Investment event at the G20 summit in New Delhi, September 2024. (Voice of America)

India-Middle East-Europe Economic Corridor (IMEC) is an initiative India’s Minister for Commerce and Industry introduced to bolster maritime security and the movement of goods between Europe and Asia (Ministry of Commerce & Industry, 2024). This initiative aims to integrate India, Europe, and the Middle East through UAE, Saudi Arabia, Jordan, Israel and the European Union for faster connectivity, lower logistics costs, and secure movement of goods (Ministry of Commerce & Industry, 2024). The announcement of IMEC came at a time when China is believed to be capitalising on the Gaza crisis to promote its interests in the region and the Global South (Fultan & Schuman, 2024). Thus, it is believed that IMEC could serve the double purpose of integrating the region and countering increasing Chinese influence.

China in the Middle East 

The Middle East is a strategic region to China because of its energy resources and location astride key trade routes. Over the past decade, China has advanced in the Middle East by developing bilateral relations and furthering its trade and investments (Fultan & Schuman, 2024). According to the U.S.-China Economic and Security Review Commission’s annual report to Congress (2024),  China’s military activity in the Middle East is increasing. It appears to project itself as a neutral arbiter of regional disputes. It also highlights that China benefits from its relations in the Middle East, which depend on energy trade and securing infrastructure contracts for its state-owned enterprises. As a result, Beijing’s engagement with the Middle East seems selective and transactional, focused on advancing its interests while having little desire to significantly contribute to resolving ongoing disputes. Consequentially, it aims to expand its market share for renewable energy and high-value exports, gain supporters in its bid for global leadership, and potentially establish new outposts capable of supporting its military for increased power projection.

India in the Middle East

India’s interests in the Middle East are primarily economic, based on its energy needs. India relies on imports for 87.9% of its oil consumption. By 2023, Iraq (20%) and Saudi Arabia (15%) were the primary sources of India's 4.6 million barrels per day, behind Russia (at 40%, the Russian share had risen sharply since the war in Ukraine, due to Moscow's discount on its barrels) (Samaan, 2024). Indian diaspora in the Gulf countries has also played a significant role in developing ties with them (Samaan, 2024). In the last decade, India has invested in infrastructure projects in the Middle East and collaborated with the Gulf monarchies to dismantle terrorist networks in South Asia (Samaan, 2024).

Additionally, bolstering maritime security in the Indian Ocean Region (IOR), especially in the Red Sea and Gulf of Aden (Patil, 2024), has aided New Delhi in developing ties with the Gulf navies.  Lastly, a significant component of India's regional policy involves arms imports, particularly from Israel, which has become Delhi's fourth-largest partner in this area (behind Russia, France and the USA) (Samaan, 2024). These initiatives by New Delhi in the Middle East are seen as measures to counter China's growing influence in the region.  

The recent IMEC project is also seen as a diplomatic offensive by India, serving as a multilateral counterbalance to China’s Belt and Road Initiative (BRI) to revive the old Silk Route. Furthermore, China’s increasing presence in the IOR through the “string of pearls”, a Chinese naval strategy, threatens India’s maritime security (Manhas, 2020). The IMEC project is envisioned as a network of railways, shipping lanes, energy pipelines and high-speed data cables connecting South Asia, the Gulf and Europe to reduce reliance on Chinese supply chains. It also aims to bolster the regional maritime security. Moreover, the European Union (EU) has welcomed IMEC as an alternative to the vulnerable Suez Canal and the Red Sea routes (Kathju, 2025). 

The announcement of IMEC also occurred when the world's five largest shipping companies deemed the current maritime trade route going through the Suez Canal and the Red Sea as ‘risky for operations’ due to the ongoing military activity  (Suri et al., 2024). India’s trade heavily relies on this route for its exports to its two largest markets- Europe and the United States. The improved infrastructure is expected to reduce logistics costs and manufacturing, gaining momentum in production-linked incentives (PLI) programmes (Suri et al., 2024). As a result, India’s role in global value chains is poised to expand. EU is India’s largest trading partner, accounting for €124 billion worth of trade in goods in 2023 (European Commission, 2024).

Moreover, the EU is the second-largest destination for Indian exports (17.5% of the total) after the USA (17.6%) (European Commission, 2024). Meanwhile, the USA ranks India’s second-largest trading partner but remains a top destination for Indian exports (Suri et al., 2024). The growing trade with these partners establishes the IMEC as an alternative trade corridor that would strategically benefit India by providing a backup route and enhancing supply chain resilience. 

Challenges for IMEC

The IMEC is the latest in a series of connectivity projects launched over the past two decades. Bringing such corridors to life requires significant economic investment and political commitment from the countries involved. The IMEC's announcement during the G20 Summit in New Delhi marked a new phase of collaboration between India, the Middle East, and Europe, all linked through their ties with the US (Suri et al., 2024). 

Large-scale transport projects like these are complex and take years to develop. India's experience with the North-South Transportation Corridor- an initiative proposed in 2000 and formalised in 2003 to connect India and Russia via Central Asia (specifically Iran and Azerbaijan)- highlights both the opportunities and challenges such projects entail (Suri et al., 2024). Similarly, India's mixed results with the Chabahar Port project have raised concerns about the reliability of such ventures (Suri et al., 2024). Yet, these initiatives are gaining momentum, primarily driven by the global push to reduce dependence on Chinese supply chains.

Furthermore, the Israel-Hamas conflict also serves as an obstacle to the further development of this initiative. IMEC’s execution heavily depended on peace in the region as it would connect the countries of the United Arab Emirates (UAE), Saudi Arabia, Jordan, and Israel. However, with the outbreak of conflict in the Gaza Strip, these efforts were halted. Furthermore, the fruition of this project required cooperation among the Arab nations that do not see eye-to-eye regarding resolving the conflict (Sullivan, 2024). With the recent ceasefire, India returned IMEC to its regional diplomatic outreach agenda (Haidar, 2025). Nevertheless, it must be noted that the volatile ceasefire acts as a temporary safety valve since the differences between Israel and Hamas persist (Adler et al., 2025). The conflict must be resolved through dialogue for international projects to come to fruition. 

Beyond the logistics and security considerations, IMEC also has to navigate the geopolitical contentions. For instance, key players in the Middle East, Egypt and Turkey are excluded from the realm of IMEC. Turkey was quick to criticise that “there could be no corridor without Turkey” and emphasised the country’s traditional role as a bridge between Eastern and Western trade (Adler et al., 2025). Similarly, Cairo is clearly interested in maintaining the salience of the profitable Suez Canal (anonymous, 2025). Eager to collaborate with India, Greece faces potential challenges as China's Cosco holds a majority stake in Piraeus, Eastern Europe's largest port, giving Beijing leverage to disrupt trade (anonymous, 2025). Meanwhile, Italy and France have positioned themselves as alternatives. These issues need to be resolved for the effective functioning of the corridor. 

The IMEC's success hinges on stakeholders' willingness to fund key aspects of the project amid rising geopolitical risks. While Saudi Arabia has pledged $20 billion, this is far short of the $600 billion target set for 2027 (anonymous, 2025). With no financial obligations imposed by the IMEC MoU, experts expect most funding from the G7's Partnership for Global Infrastructure and Investment.  

The Impact of Trump 2.0

With the re-election of President Donald Trump, the Global Political landscape shifted drastically. Barring some differences, India and the USA have much to gain from Trump’s second term in the White House. Trump’s outlook on India’s role concerning China reflects a unique geopolitical approach that extends beyond traditional balance-of-power strategies while still acknowledging their importance. While India’s position as a key player in the Indo-Pacific and a counterbalance to China remains significant, President Trump seems to view India as an independent and influential power in Asia and globally (Mir et al., 2025). He emphasises the need for a strong and lasting partnership between the United States and India, built on fair and mutually beneficial terms, especially in economic matters (Mir et al., 2025). This perspective, which combines commercial pragmatism, reciprocity, and a focus on advancing American interests, marks a shift from the more conventional US strategy. Previous administrations prioritised India’s rise as a strategic counterweight to China, emphasising balance-of-power politics and shared democratic values.

Viewing their relations from a ‘realist’ perspective, both New Delhi and Washington want to thwart Chinese economic and geopolitical influence in the global development paradigm, bolster global supply chain resilience, and secure new and old energy sources/minerals for the US economic growth and green transition (Gupta, 2025). The controversial project 2025 launched by the Trump administration also argues that the United States Agency for International Development (USAID) and the US International Development Finance Corporation (USDFC) should “finance programs designed to counter specific Chinese efforts in strategically important countries and eliminate funding to any partner that engages with Chinese entities directly or indirectly.” It also calls for “greater cooperation on development between the US and “pro-free market” Japan, South Korea, Australia, India, and Taiwan. Thus, initiatives like IMEC will likely gain momentum, given Trump’s ambitions to gain wider market access and thwart the Chinese efforts. 

Conclusion

The IMEC represents a strategic step in India's efforts to enhance connectivity, strengthen economic ties, and counter China's growing influence in the Middle East and beyond. While the project promises to improve trade routes, reduce logistical costs, and reinforce supply chain resilience, its success hinges on overcoming geopolitical tensions, securing financial commitments, and ensuring regional stability. India's diplomatic outreach, backed by its growing economic significance and strengthened partnerships with key global players, offers a solid foundation for IMEC’s progress. However, sustained stakeholder cooperation and a stable security environment remain crucial for translating this ambitious vision into reality. As global power dynamics shift with Trump's return to office and China’s strategic manoeuvres, IMEC’s success will ultimately depend on its ability to deliver tangible economic benefits while navigating complex political landscapes.

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