The year 2014 was a decisive one for Indian politics. With the biggest mandate for the post of prime minister, Narendra Modi became the symbol of a new chapter in India’s growth story. While the focus of Modi’s campaign was revitalising India’s economy, he has surprised political pundits with by emphasising foreign policy. From inviting the leaders of the South Asian Association for Regional Co-operation (SAARC) countries for his swearing-in ceremony to making bilateral visits to 18 countries by the end of his first year in office last month, Modi has been unafraid to raise his profile internationally. After a decade of indeterminate foreign policy under the previous Congress-led government, Modi is keen to show the world that India finally has a strong leader at the helm and that it is an easier place to do business in.
Domestically, opinion on Modi’s approach to foreign and economic policy is polarised: while some view his overseas engagement through the lens of pride and nationalism, his critics chide him for spending far too little time at home and getting his domestic affairs in order. Western observers are less caught up with the ideological debate that makes Modi such a divisive figure in India, but remain uncertain over whether his engagement abroad has been more about style than substance. Part of this scepticism comes from the extremely low bar set by the previous government. India is certainly more visible on the global stage under Modi, but does this imply that the prime minister has made progress in substantive policy issues?
Western views on economic policy, in particular, appear less favourable than is perceived domestically. In an interview, Gareth Price, Senior Research Fellow in Chatham House’s Asia Programme, said that although Modi ran on the platform of economic reform, there is no consensus within the BJP on liberalisation policies, and that attitudes towards reforms were therefore likely to be determined on a case-by-case basis. Indeed, the government has struggled to push through key reforms such as the goods and services tax bill and the land acquisition bill, both of which are critical for Modi’s signature ‘Make in India’ campaign and for luring foreign investment. Although the BJP has a majority in the Lok Sabha – the lower house of the parliament – the absence of one in Rajya Sabha (the upper house) allows opposition parties to stall policy reforms.
Stratfor, the US geopolitical intelligence firm, observes that the BJP has already lost some momentum from the highpoint of 2014. This is demonstrated by the party’s poor performance in the Delhi state elections where the Aam Aadmi Party, a newcomer to politics, had a sweeping victory – and will likely continue to face an uphill battle in the upper house beyond 2016. Growing fissures within the BJP over key political reforms are likely to further hamper progress. An added complication is the curious case of the government adjusting the base year to calculate economic growth, which led to a revision in the 2014 growth rate to 6.9% from 4.7%. Even the country’s chief economic advisor, Arvind Subramaniam, appeared stumped by the new GDP numbers, which CNN called a ‘total mystery’. Of course, it does not hurt that the revised numbers are closer to China’s growth rates, an important symbol for a prime minister seeking to attract foreign investment.
Overall, the general view appears to be that for a prime minister elected primarily on the promise of economic revival, Modi’s first year in office has been lacklustre. A Bloomberg editorial concluded that “In his first year, Modi has spent too much political capital to no coherent purpose.” Part of this verdict reflects the unrealistic expectations and the euphoria attached to Modi’s ascension to power. In his first year in office, the prime minister has eschewed bold reforms in favour of what his officials call ‘creative incrementalism’, characterised by steps to tackle issues such as easing bureaucracy, clearing backlogs of projects, cutting fuel subsidies, and re-auctioning telecom and coal-mining licenses. And while the past year has seen pledges for billion-dollar long-term deals from countries such as Japan, the US, China and Russia, restoring the Indian economy to the glory days seen a few years ago will require much more willingness from the government to make tough decisions, pick a fight with political opponents when necessary, and make concessions and build consensus when the stakes are high.
The Western scorecard on Modi’s security policy is more forgiving. Because foreign policy was not expected to be in such sharp focus, Modi’s charm offensive has captured the attention of the international community. Modi’s multi-alignment strategy in foreign policy has helped build bridges and sustain relationships, an essential factor for attracting investment. Moreover, Modi’s clear electoral mandate has given him the flexibility to stabilise relations in the neighbourhood – particularly with Bangladesh and Sri Lanka – that were previously held hostage by domestic politics. Crucially, Modi’s strategy is notable for the absence of the ideology-driven bombast that some observers had foreseen, given the Bhartiya Janata Party’s strong right-wing and Hindutva worldview.
The prime minister has chosen pragmatism and tangible outcomes – such as treaties and investment – over dogma in international relations. This approach has helped placate neighbours in South Asia and paved the way for a reset of Indo-US ties. President Barack Obama’s visit to India as the chief guest of the Republic Day celebrations in January – the first time an American presided over the ceremony – had the dual effect of boosting Modi’s legitimacy at home and demonstrating that India and the US are on an equal footing. Western experts credit Modi’s savvy in turning around the relationship, which had hit a trough following the arrest of the deputy Indian consul general, Devyani Khobragade, in late 2013 on charges of visa fraud.
Alyssa Ayres, a former US State Department official under the Obama administration and Senior Fellow at the Council on Foreign Relations, argues that because Modi has successfully set a new tempo, tone, and trajectory for the bilateral relations – instead of focussing on the Khobragade affair and the earlier rejection of his US visa – the bitterness of those disputes has been replaced by a sense of optimism. During Obama’s visit to India, both countries made progress on the 2008 civil nuclear deal and, importantly, issued a Joint Strategic Vision for the Indian Ocean and the Asia Pacific Region, which affirmed the significance of maritime security and called for the freedom of navigation in the South China Sea.
The statement garnered a lot of interest because it was a thinly veiled reference to China’s increasingly rigid stance on its territorial claims in the South China Sea, and because it was the first time that India and the US spoke together on the issue. At a time when India is trying to reassert itself as a traditional security partner of countries in the Indian Ocean region, the joint statement had the symbolic value of showcasing the US’s acknowledgement of India’s key role in the region. This, along with Obama’s tilt towards India and strained relations with Pakistan and the progress in breaking the logjam on the civil nuclear deal, has led to optimism among some analysts that a new strategic partnership between New Delhi and Washington is underway.
Such expectations, however, may be exaggerated. Rather than an overhaul of existing foreign policy, Modi’s strategy has essentially been a continuation of the previous government’s policies, albeit in a more articulate and confident manner. As Frederic Grare – Director of the South Asia programme at Carnegie Endowment for International Peace – notes, the main difference between the Manmohan Singh administration and the current one is Modi’s ability to communicate effectively, and the most substantial results of Modi’s diplomacy owe their success to policies begun by the previous administration.
There is no doubt that Modi has made visible headway in improving Indo-US relations. But, this is unlikely to translate into New Delhi becoming a strategic ally of Washington. India will work with the US only in cases where it is in its interest to do so. For instance, closer ties with the US have not resulted in the erosion of the friendly relations between Russia and India, even at a time when the Western world is suspicious of Moscow’s intentions following its annexation of Crimea. Modi hosted Vladimir Putin in New Delhi late last year and the visit yielded long-term contracts worth USD100 billion, including crude oil deals and an agreement for Russian construction of nuclear reactors in India.
Moreover, while some in Washington envisage a strategic partnership between the US and India that could help contain China, calculations in New Delhi are different. There is no doubt that the Indian security establishment is cautious about China. Frequent incursions along a massive border on which there is no consensus, China’s development of the Gwadar port in Pakistan and its growing influence in the Indian Ocean region, and Beijing’s ambitions of regional hegemony are viewed with suspicion in India. However, New Delhi is far behind China in military investment, upgrade, and expansion, and it will be a while before the military upgrade that is currently underway in India bears fruit. In the meantime, engaging with all stakeholders in the Asia-Pacific region and actively participating in multilateral forums appears to be the best strategy for India. Furthermore, China is an essential investment component of Modi’s economic policy, which is his top priority. Modi will be careful not to upset this relationship. The policy of multi-alignment is therefore likely to continue in the near term.
Although economic concerns will continue to dictate India’s conduct on the world stage, under Modi there is an acknowledgment of the need – and even a desire – for India to be more visible in international affairs. It remains to be seen if a definitive doctrine emerges at the end of Modi’s term in 2019. What is encouraging is the certainty that the prime minister has a mandate for five years that will give him the leverage he needs to develop a deliberate foreign policy strategy. It may well be that all Modi can offer is delivering on existing plans rather than overhauling New Delhi’s doctrine on foreign policy. Nevertheless, even this accomplishment will go some ways to making India an active stakeholder in world affairs
Amitha Rajan is a former Reuters journalist who recently completed an MA at the School of Oriental and African Studies. She is a contributor and volunteer at PS21.