The last few months have upended not only global trade but also long-held beliefs in international relations. Despite being strategic partners and natural allies, we see that many countries’ policies, particularly those of the US, are not conducive to India’s global positioning and current stature. Though the Indo-US trade talks are back on track after hitting a rough patch, Indians should not be too surprised by any future shocks. The US has put restrictions on the H-1B visa and the withdrawal of the exemption to the Chabahar port in Iran, both of which disproportionately affect Indian interests. Our surprise at these developments reflects on our lack of perspective on geopolitics and geo-economics.
Global geopolitics is given. Every country is pursuing its national interests. An overlap of interests in one area does not mean that the first country will not pursue its interests in matters that might put it in an adversarial position with some of its partners. Pursuance of one’s own national interest also involves actively undermining the economic, strategic and political interests of other countries.
India must first and foremost decide its national interests. It includes rapid economic growth, social stability, peace within its borders, and the maintenance of credible deterrence along its land borders in the north, east, and west. Our national interest also lies in maintaining strategic autonomy, for which we need to insulate ourselves from hostile actions by global powers in the domain of energy (oil and gas), semiconductors, rare earth materials, pharmaceuticals, defence platforms, etc. Some of these need to be achieved through the doctrine of aatmanirbharta, irrespective of the financial costs involved. For others, we need to cultivate our relations with other countries and strengthen multilateral platforms.
No doubt, the US have bruised Indian self-respect and ego, and there is a shared sense of betrayal among the citizens; however, the path of retaliation is not a prudent strategy. India has already done enough to show that global players would not dictate it on matters of its national interest. We do not depend on external security cover. We have continuously reduced our dependence on foreign sources in defence relations, especially in the purchase of offensive platforms that require constant support for operations and maintenance. Except for energy, all other areas of engagement are expected to remain unaffected.
America and European countries remain important to India. As a free, democratic, and secular society, India is a natural ally of the US and other G7 and G20 countries. Until we have a trade deal with the US, our FTAs with countries like Germany, the United Kingdom, New Zealand, Oman, the UAE, Australia, Latin America, and the Eurasian Economic Union are bound to benefit our economy. This is already evident in the increase in our exports, robust GDP growth, and IIP manufacturing-sector numbers.
But to take full benefit of FTA, our first focus should be on domestic reforms and strengthening our manufacturing sector, particularly the MSME segment. It was already a work in progress and a focus area for the government, but the trade imbroglio with the US has added urgency. It is an undeniable fact that the Indian manufacturing sector still needs to cover a lot of ground to be globally competitive. India could not fully take advantage of its earlier FTAs with countries such as Japan and South Korea because of this limitation. The recent Goods and Services Tax (GST) NextGen 2.0 reforms and other important steps, such as deregulation and Labour Code notifications that reform factor markets, will ensure that our economy continues to withstand global shocks and move ahead as the fastest-growing large economy in the world.
India has always been a strong proponent of multilateralism and a rules-based international order. The current cold phase in global relations gives India the opportunity to focus its time and attention on protecting and promoting multilateral platforms and organisations. A world divided into small camps with competing bilateral relations is neither conducive to economic growth nor to global peace. Bilateral free trade agreements (FTAs) have become a rage, and we too are negotiating several FTAs, but we should not forget to protect the interests of the Global South, most of which would not be able to negotiate fair bilateral trade agreements with the Western block.
India is not beholden to any great power and will never act as a hired gun. This might come as a disappointment to some countries, but they must understand the psyche of the Indian state and modify their expectations accordingly. We might have some overlap with China right now, but given the ruthless pursuit of its own interests and its strategic culture and history, China might try to lull us into complacency and then give us a rude shock later.
A unique feature of hotly contested domestic politics in India was a near-consensus on international matters. With an irresponsible opposition that fails to draw a boundary between political and national interest, that aspect of consensus is, regrettably, missing right now. Domestic political compulsions in such cases may limit the options of the Government to take a strong stand on foreign affairs. Thankfully, Modi Government, in pursuance of India’s national interest, is not constrained by petty domestic political considerations.
