India’s foreign policy today is primarily driven by pertinent external factors, which in turn are significantly connected to its domestic policy. Let us look into this in depth.
Foremost is the ever-dynamic geopolitical landscape of the continent. In the West, the rise of a nuclear Iran, at odds with the Sunni Saudi, backed by the Gulf Cooperation Council members; the intermittent failure of state governance in the Middle East, especially Syria and Iraq, expedited by the activities of the Daesh; the complex situation in Afghanistan, vis-à-vis the collation of the willing, and an ever-increasing belligerent Pakistan. On the East, the rise of China economically and strategically; an ambiguous relationship with Myanmar and Bangladesh, and a squandered one with Sri Lanka and Nepal; and the South China Sea quagmire. New Delhi faces a tough geopolitics test, traversing through this complex environment.
Prior to Modi’s ascension to the centre, New Delhi’s foreign policy overtures were at best adequate, led by a complacent leadership with no substantial forethought on pertinent matters, nor the political will required to get the job done. The NDA government, on the other hand, has managed diplomatic initiatives with aplomb – in these past two years, the headline for New Delhi’s foreign policy has been a clear and unambiguous statement for India’s ambitions for global power.
However, in a volatile geopolitical landscape, where political overtures make or break relationships, India has a fairly poor record of managing its partnerships with other nations, both in its periphery as well as in the strategic sphere. As a result, New Delhi’s emissaries are often times left red-faced when present in bilateral or multilateral forums and other regional platforms.
India has been courting Iran since 2003 for building a seaport in the south-eastern coastal town of Chabahar, which has the potential for reordering India’s geopolitics in the north-west of the subcontinent. Unfortunately, the previous government could never overcome its internal incoherence to actually pursue its declared strategic objectives towards Iran. While a prolonged global sanctions regime made engagement with Tehran difficult, the UPA government’s lackluster attempt at navigating these financial sanctions was simply underwhelming. With Iran once again accepted into the fold of the international community, New Delhi has a golden opportunity to leverage its strategic partnership with Tehran, and finally circumvent Pakistan geographically in order to connect to Central Asia and Afghanistan.
At the same time, in its overtures to Iran, the challenge for the Modi Government is to not upset the Saudis, who are another strategic partner for India. Iran and the Saudis have never seen eye to eye, and tensions escalated to a new high last year when Saudi Arabia executed a prominent Shia cleric, a move opposed by Iran. Both the nations withdrew their diplomatic missions amidst an increasingly confrontational situation. New Delhi will have to tread lightly here, to ensure that its relations and intentions do not irk either of the two Islamic powers against it. Avoiding an ambiguous relationship, akin to the one India shares with Israel and Palestine, will be highly desirable here.
Meanwhile, in the Middle East, although India does not have any overt interests, or significant allies (in the warzone), the atrocities and coverage of the Daesh is a cause for concern. India features prominently in the Daesh’s global ambitions of instating an Islamic Caliphate, and even though the organization is yet to penetrate the Indian border, its influence is troublesome. A prominently small number of brainwashed Indian citizens are believed to have travelled to Syria to fight alongside the Daesh. But the bigger concern for India, is the apparent competitive streak between the Daesh, and the neighborhood-grown al-Qaeda, both of which may strive to carry out more spectacular attacks in the region, in order to impose hegemonic supremacy.
As an aspiring global power, New Delhi cannot be seen taking a backstep in the global war against terrorism. Therefore, once again the challenge for the Modi government is to gauge how much intervention can India afford in this war, such that it fulfils its strategic obligations, and does not provoke the Daesh into massive retaliation.
Kabul and New Delhi are historic close allies, and today this bilateral engagement is further deepened by development initiatives, capacity building and economic opportunities. However, since the 2014 NATO drawdown in the country, Afghanistan has been in dire need of military and training assistance, which New Delhi has been hesitant to provide. In the absence of Indian influence, Islamabad has been quietly courting the Afghans, recently engaging in an information sharing venture, to weed out non-state elements from their shared border.
For New Delhi, Afghanistan plays a key role in its strategic posturing, vis-à-vis its geographic location. Not only can Kabul be leveraged to geographically to squeeze Pakistan, but it also gives New Delhi an entry into Central Asia.
The Indo-Bangladesh bilateral ties have historically been cordial, however non-compliance on major treaty provisions by India, and New Delhi’s hesitation in addressing long standing contentious issues have costed India a lot of leeway with Bangladesh. Similarly, New Delhi will have to emphasize on its engagement with the newly elected democratic government in Myanmar, as it chose to deliberately not engage much with the previously military junta ruled leadership.
Sri Lanka has not been an easy partner for New Delhi to engage with; Colombo’s discriminatory policies towards its Tamil population has been a point of contention with India for long. However, recently elected President Sirisena is widely considered to be pro-India within the political echelons, and the onus is now on the Modi regime to engage Colombo, simultaneously pacifying the DMK rule in the south.
With China and Pakistan, New Delhi has not managed to make any significant headway. While Pakistan has maintained its bellicosity over the years, China’s rise has resulted in a restructuring of the world economy, to which India has just started adjusting.
Pakistan has for long been on the cusp between West and South Asia, and suffers the ailments of both. However, the problems in dealing with the Pakistani state arise not from the absence of collective want, but rather the conscious choice the establishment makes in choosing its state instruments of political Islam and jihadi terrorists, and their calculated use of tension in their regional relationships with their neighbors. As such, Pakistan’s ability to hold steady relationships with its neighbors has progressively declined.
India has consistently tried to normalize relations with Pakistan, and for the collective interest of the two, New Delhi will continue to engage with Islamabad in the future. The alternative will be in neither side’s interest. Therefore, the most immediate concerns which the Modi regime needs to iron out with its Pakistani counterpart are restoring the ceasefire, controlling and eliminating cross-border terrorism, enabling normal MFN trading, and implementing past agreements such as bringing the perpetrators of the Mumbai attack to book. Bilateral engagement with Islamabad will be judged on the basis of these caveats, and will be the ultimate yardstick for Modi’s foreign policy.
On the other hand, the rise of China in the past decades has overshadowed an equally important, if not as impressive, rise of India. Beijing and New Delhi have long standing contentious issues, such as the international boundary, trans-border rivers and Chinese activity in PoK. These issues notwithstanding, both the nations have adjusted to each other’s geopolitical space and grown the bilateral relationship. China is now India’s top trading partner, and both the neighbors engage over areas of common interest such as education and medical research, amongst others.
However, for the Modi regime, the challenges of engaging China are more indirect, rather than overt. China’s rise mandates India to deal with two major issues. The first is of the re-ordering of Asia-Pacific; in the past two decades, China has increasingly taken an expansionist stance in the region, aiming to become one of the dominant powers. This stance has been significantly reflected by Beijing’s conduct in the South China Sea. The maritime order is contested, as is the global commons in outer space and cyber space. This in itself is a marked change from many decades of unchallenged US dominance. While this has led to increased defense and maritime security cooperation between China’s neighbors (primarily India, Japan, Australia and Vietnam), it has also lead to one of the biggest arms buildup in the region. As such, New Delhi is now faced with an uncertain prospect, where it can no longer assume that others will guarantee the safety of its trade vessels at the high seas, carrying its foreign goods and energy supplies. Neither can it assume that a benign world order will maintain the peace. Therefore, the first challenge is to figure out how much new responsibility is India willing to assume, and how far is it willing to compromise on strategic autonomy and work with others on these security issues.
The second issue is that of carrying out structural reforms in the economy, to match up to China’s rise. The present stress in the Chinese economy gives India a window of opportunity to concentrate on industrialization, before it bounces back.
New Delhi needs to come to terms with the fact that India’s de facto policy of non-alignment will not stick in the present global order. Narendra Modi has started on a good beat, but the government at the center still has a long way to go to address the issue of its political ambiguity when it comes to dealing with friends and foes, as they stand.
The Modi regime has clearly articulated that foreign policy has to subserve domestic goals, that is, speed up economic growth and help to bring in capital and technology. Indeed, India’s economic development has been a central theme of Modi’s many visits in these past two years. By embedding India’s domestic economic and development agenda firmly into its foreign policy, the NDA government has tried to show the world that it has the confidence to deal with multiple partners to realize this goal, while revitalizing old partnerships.
Therefore, the final challenge to New Delhi’s international overtures is dealing with the country’s diminishing attractiveness as a manufacturing base and investment destination (although it still maintains its reputation as a prime market for international trade). Here, the word diminishing is used in a contradictory connotation. Essentially, global economic reports suggest that India (under the Modi regime) has become the biggest FDI destination in the world, surpassing the US and China. Figures for the first half of 2015 show FDI in India pegged at USD 31billion, with China and US at USD 28 billion and USD 27 billion, respectively. Furthermore, compared to 2014’s FDI inflow (USD 12billion), it would appear as if New Delhi is on a roll. Unfortunately, that is not the entire story.
A major reason why India is on an accelerated growth tangent as compared to the rest of the world economy is because of the ongoing slowdown which has gripped the rest of the world (particularly China). It should be noted that in 2014, Beijing received FDI worth USD 75billion, while Washington managed USD 51billion.
Pitted against those statistics, it is still good news that the world is finding India as an important alternative, when the others are not doing so well. Also, this puts India on the fast track to increased investment, posed to take full advantage once the world bounces back from its economic woes. But in that case, is New Delhi prepared to sustain its performance, going forward?
Unfortunately, that is where the Modi regime seems to have come up short. Industrial growth in the country has not yet picked up in a sustainable manner, and the stress in the corporate sector is still a persisting worry. Challenges abound on multiple fronts, such as infrastructure development, attracting fresh investment, and addressing a weak corporate sector. Economic revival needs to appear on the ground.
This will include sorting out the problems in taxation, repairing the critically damaged banking sector and ensuring ease of doing business by facilitating enabling factors (land, water, electricity, necessary clearances etc.) to begin a business in India. While global slowdown is a blessing in disguise for India, to cash in on the opportunity, the country needs to fast track its reform agenda, besides improving the infrastructure sector.