India Prime Minister Narendra Modi’s visit to Addis Ababa underlines Ethiopia’s rising strategic importance and the expanding role of public-private financial networks in turning diplomacy into trade.
The visit of Indian Prime Minister Narendra Modi to Addis Ababa this week marks more than a diplomatic milestone. By elevating India–Ethiopia relations to a strategic partnership, the two governments have signalled an intention to move decisively from political goodwill towards deeper economic and institutional cooperation. At a time when the Global South is reshaping its development pathways, the visit carries significance well beyond protocol.
Ethiopia, Africa’s second-most populous country, occupies a central position in the Horn of Africa and has long been viewed as a gateway to the continent. India, for its part, has become one of the most active external partners across Africa, with commercial interests spanning manufacturing, pharmaceuticals, agriculture, technology and infrastructure. The Modi visit reflects a convergence of priorities: Ethiopia seeking capital, trade expansion and foreign-exchange stability; India seeking reliable, long-term partners in fast-growing markets.
The unusually warm welcome extended by Prime Minister Abiy Ahmed underlined the political importance Addis Ababa attaches to the relationship. When the two prime ministers arrived at the Sheraton Addis, members of local and international business and community circles were present to observe and welcome the moment among them Mr Abdirashid Duale, reflecting the close interest of the private sector and diaspora communities in the visit’s economic implications.
Yet beyond ceremony, the real test will lie in execution how trade flows are financed, how investments are settled, and how cross-border economic activity is sustained.
This is where financial intermediaries with deep regional roots and effective public-private partnerships play an increasingly central role.
Trade and investment partnerships depend not only on government agreements but on the capacity of businesses to move capital efficiently, compliantly and predictably. For Ethiopia, strengthening foreign-exchange inflows, expanding trade finance and integrating diaspora capital into the formal economy are now key policy objectives. Achieving these goals increasingly requires closer coordination between public institutions and private-sector operators.
Institutions such as Dahabshiil Group, one of the Horn of Africa’s largest financial services and investment groups, illustrate how private actors can support public economic objectives. Founded in the region and operating across Africa, the Middle East, Europe and North America, the group has long been associated with remittances. Its role has since broadened to encompass a wider range of financial services, including banking services across the region.
Through entities including East Africa Bank, Dahabshiil Group works with Indian, Ethiopian and global banking and commercial partners, and has expanded into trade-related payments, settlement services and cross-border liquidity support, operating alongside banks and regulators to facilitate formal trade flows.
Dahabshiil Group already facilitates significant trade-related financial flows between India and the region, including Ethiopia, supporting importers and exporters across sectors such as pharmaceuticals, consumer goods, machinery and agricultural inputs. Indian suppliers exporting into the region, and regional traders sourcing from India.
Beyond bilateral corridors, the group supports triangular and multi-market trade linking India with the Horn of Africa, the Gulf, East Africa, Europe and North America. This includes settling payments for regional exporters accessing third markets, supporting Indian firms operating across the Horn of Africa, and channelling diaspora-linked capital into productive trade and investment activity.
The relevance of these developments is further underscored by the presence in Addis Ababa of the Chief Executive Officer of Dahabshiil Group, Abdirashid Duale, who is engaging with stakeholders to assess economic and regulatory developments and to meet diaspora business communities active across Ethiopia and the wider region. Such engagement highlights how public-private partnerships are becoming more important than ever in translating diplomatic momentum into practical outcomes.
Yet the success of this renewed partnership will depend less on summit communiqués than on the plumbing of finance and trade — and on the effectiveness of collaboration between governments and private institutions. As states set direction, organisations such as Dahabshiil Group quietly ensure payments are settled, trade continues and commercial relationships endure.
