Many critics and political rivals of the ruling Bharatiya Janata Party have dismissed India’s G20 presidential year as a routine exercise. They argue that the cycle of the G20 presidency passes to different member countries every year. Their argument is valid but what makes this opportunity significant for India is its timing. Europe and America are staring at a recession-like situation and China is expected to go further down economically with the latest Covid surge, the largest in the world.
In this frustrating global scenario, India has emerged as a country of hope, both for developed and developing nations. And the year of India’s G20 presidency, from December 2022 to November 2023, will be defined by it. It will give Indian diplomacy a much-needed opportunity and fillip to expand the country’s outreach and will provide its policymakers with a strategic depth globally. The G20 presidential year is expected to help India in its image-enhancement exercise, find new partners, and reinforce relations with old ones like the United States and Russia and rivals like China. The platform is expected to be a mirror of India’s independent foreign policy driven by its increasing economic might.
PULL OF THE ONLY MAJOR PROMISING ECONOMY
The World Bank has warned of a possible global recession in its latest forecast. Cutting down global growth estimates for 2023 and 2024, owing to factors like the Russia-Ukraine war, persistently high inflation, and higher interest rates, the lender, in its Global Economic Prospects, has warned that the global economy is perilously close to the onslaught of economic recession this year.
The reasons are weaker economic growth in all major economies, the United States, Europe and China, coupled with the ongoing Russia-Ukraine conflict. India remains a promising figure in the current scenario, the multilateral bank reiterates, like in its earlier assessments. The World Bank’s analysis is similar to the assessments made by entities like the IMF or globally known economists like Nobel Laureate Michael Spence.
India is the only major global economy slated to have 6+% GDP growth figures in the years ahead. Last year, at $3.18 trillion, it outpaced Britain to become the fifth-largest economy in nominal GDP terms. In purchasing power parity (PPP) terms, its condition is even better. It became the world’s third-largest economy in PPP terms in 2021 at $10.22 trillion.
The country’s economy has successfully emerged from Covid waves battering its health in the last three years. The nation has been relatively immune to the effects of the Russia-Ukraine war that disrupted global supply chains and shot up inflation rates in most countries. While the global economy is seeing these negative growth pangs, India has managed to grow impressively and has kept its inflation rates under control.
A Morgan Stanley analysis says India in fact can grow even faster, outpacing Japan and Germany to become the world’s third-largest economy in nominal GDP terms much earlier, by 2027. The expected deadline to achieve the scale by some earlier economic projections was either 2030 or 2035. In 2012, India was the 11th largest economy. The future shines bright as India is expected to retain its highest growth rate globally till 2060 when compared with China, Japan, the US, Germany and the world as per OECD baseline projections.
India will be a market for the world that cannot be ignored. An Ernst & Young analysis says the Indian economy is expected to cross the $30 trillion mark by 2048, going up tenfold. In PPP terms, it will be $40 trillion-plus. It will be a market of the world’s most populous country, capable enough to import and export goods and services to and from every county and continent. In 2023, when India is scheduled to drive the agenda of the most influential bloc globally, the G20 forum, this unparalleled economic strength is going to be an unwritten tagline with Indian diplomacy expected to be in action mode.
MAKING IT A SOFT POWER PEDESTAL
India features nowhere in the top ranks of major global soft power ranking indices. The Brand Finance’s Global Soft Power Index 2022 ranks the US as number one, followed by the UK, Germany, China, Japan, France, and Canada. India was in 29th place. It largely goes to the efforts made by these countries.
Hollywood cinema is the most dominant vocal media in the world with its global outreach. Many in India might not be aware of IB and RAW, India’s intelligence agencies, but they would most likely know what the FBI, CIA, and Pentagon do. It is part of the cultural export to the world that rides high on the US’s economic and military might. The Indian Army, outside India, generally would not be a matter of public discussion, but China’s People’s Liberation Army (PLA) will have a much wider recall, much like the Navy SEALs and Top Gun, the US Navy’s elite fighter weapons school.
Soft power projection is a much-needed diplomatic effort to push a country’s strategic outreach to attract other countries in support. It also helps develop bilateral and multilateral relations, secures investment, industrial linkages and, above all, tourist inflow. China’s proliferation of Confucius Institutes globally and its push for Mandarin teaching is a good example. Known as a dictator country run by a party since 1949, these are parts of China’s soft power tools to correct the narrative on how inside it is a different and much better country.
India, policywise, has failed to perform on this front diplomatically. Jammu and Kashmir is an integral part of India, yet Pakistan was more vocal in internationalising the issue. India has been a successful democracy since its independence in 1947. It means all religions are respected here in its law and order machinery, yet the country never asserted it internationally so far. China is criticised for atrocities in Xinjiang, yet the world never hears any contradictory statement from resident Uyghur Muslims criticising China. China does not allow protests there. Compare that to India. The hostile views and statements of many leaders of Jammu and Kashmir are carried even by mainstream news channels of India, but the world is hardly aware of the hostile comments of separatist leaders from Pakistan-occupied Jammu and Kashmir, Balochistan, and Gilgit-Baltistan. What India has done is a part of its vibrant democratic process but failed to make it part of its diplomatic narrative abroad.
That started changing in the last few years. India has left the policy of adopting vague diplomatic manoeuvres to become an assertive player. It fully integrated the area of Jammu and Kashmir into the Indian territory, ending its special status, and asserted it internationally, and despite intensified efforts, Pakistan failed to internationalise it. The hostile pro-Pakistan voices from the area are still continuing to spew venom but India’s diplomatic assertions internationally are successfully countering their propaganda.
The best example of this diplomatic assertion can be seen in the Russia-Ukraine war where India’s stand was welcomed by all major powers. Russia shares good ties with India, yet India was categorical in telling Russia that the era of war was over and India cared for Ukraine’s sovereignty. The stand taken by India became a salient point of the G20 Communique after the Bali Summit in November 2022. India imports almost 85% of its crude oil and took the pragmatic decision to increase the oil import quota from Russia for cheap fuel on the same lines as European countries, despite putting sanctions, continued to import Russian gas to meet the huge energy needs to survive the winter.
Energy prices have skyrocketed after the Russia-Ukraine war but India, with a population of 140 crore people, sharing the maximum load of below-poverty-line population, has kept the energy prices under control thanks to cheap Russian oil. After all, common people are the end victims of higher energy prices, and India took a decision based on its internal compulsions, the same as European countries importing Russian gas. The Indian diplomatic machinery was vocal in making it part of its communication narrative and this helped.
The G20 presidential year can give India a much-needed wider platform to redefine its diplomatic manoeuvring in a new and stronger way that started some years ago. With around 400 official and unofficial G20 meetings to be hosted, India will get important global audiences to project its soft power appeal as the time is ripe for it.
Being the central point of attraction economically, India has much to gain. The country is seeking to develop a multipolar world and its remarkable outreach to both developed and developing countries can be a good tool in its soft power projections. A market for the developed world, it has reached out to needy countries in handling the pandemic. Covid vaccines were exported to over 100 countries. India championed the effort of TRIPS or intellectual property waiver on vaccines and related medicines to make every country an equal partner in production and distribution. It has fought against the interests of developed nations to ease the food grain export threshold to help needy countries with food supply. India’s diplomatic arsenal has what it needs and now is the time to put its drive in full speed and the G20 platform will be perfect for it.
THE GLOBAL SOUTH – AN INDIA MAKEOVER
On January 12, India held a virtual summit of the Global South leaders. Called the Voice of Global South Summit, it conveyed India’s message to other developing countries to come together and end the discriminatory practices by rich economies by redefining political and financial governance structures. Prime Minister Narendra Modi reiterated his message from last year’s G20 summit. The core of it was to give Global South countries a level playing field, to give them equal status ensuring their growth.
The Global South is a bloc of 145 countries from Asia, Africa, Latin America and Oceania excluding Japan, South Korea, Israel, Australia and New Zealand. It is the most populous bloc on earth and with major economies like India, China, Indonesia, Brazil, and Mexico, it can create a parallel economic force for the future. It will be a big market and a great strategic power in the years to come. It matches well with India’s external policy objectives of creating a multipolar and multilateral world.
Yes, the G20 is limited to just 20 countries and the European Union but India has decided to take the Global South bloc together in its presidential year. PM Modi has said that the Global South voices, ignored so far, will play a special role in framing India’s G20 presidential year. The summit invited leaders from over 120 Global South countries.
India, historically, has led different blocs of countries that are called the Global South today. Most countries of this bloc are poorer nations, colonised and exploited by rich nations some decades ago. India and China, global economic powers today, are still counted as developing countries. Historically, these two countries happened to be the most influential powers in the world before colonisation, according to assessments by many economists.
These countries formed various platforms to raise their voice against the developed bloc of the world with India being at the forefront.
The 1955 Bandung Conference between 29 Asian, West Asian, and African nations was co-sponsored by India, Burma (now Myanmar), Indonesia, Sri Lanka, and Pakistan. It spoke up for equality and political self-determination in a world dominated by the US-Russia Cold War.
The Non-Aligned Movement (NAM) followed the Bandung Principles and was established in 1961 with the Belgrade Conference. Prime Minister Jawaharlal Nehru led the movement along with Egypt’s Gamal Abdel Nasser, Indonesia’s Sukarno and Ghana’s Kwame Nkrumah. The message was – don’t align either with the US or the USSR, oppose colonialism, and push for multilateralism and national self-determination. The 120-member-strong NAM is a trans-continental bloc like the Global South with 53 countries from Africa, 39 from Asia, 26 from Latin America and the Caribbean, and two from Europe (Azerbaijan and Belarus).
In 1964, developing countries formed The Group of 77 (G-77), the largest intergovernmental organisation of developing countries in the United Nations. Currently, it has 134 members and it is now trying to emerge as a significant power bloc in the UN. It pushes for a level economic field for developing countries to create a new international order on global economic issues with South-South Cooperation. India organised a meeting of the group during the last UNGA in 2022 to demand UN reforms and greater access to the Global South countries.
PRIORITISING OWN INTEREST
Global geopolitics is changing fast and India is taking a calculated approach to emerge as a major power centre in a multipolar world with an independent foreign policy approach based on its domestic compulsions. Historically, India’s domestic and foreign policies have been two separate domains but internal conditions are now more and more affecting the shape of its foreign policy.
India not getting vocal against Russia is a part of its soft power approach, while the country is also reducing its dependency on Russian arms as a part of its hard policy approach. Russia is tilting more towards China, a country India doesn’t share good relations with. Also, Russian arms export to Pakistan is increasing.
The US and China are India’s largest trade partners, yet India’s policy towards them is driven by its internal considerations. The bilateral trade between India and China was $115.42 billion in 2021-22, says official data. The trade deficit is heavily tilted in China’s favour with imports taking a major share at around $94.16 billion. In spite of sovereignty concerns and ongoing tension, both India and China know that they need each other’s markets. For China, India is a $100-billion export market and increasing. It becomes even more important with the US-China trade tension. For India, China is a hub of raw materials for many of its industrial processes. India is trying to become self-dependent in the defence and industrial sectors but the process has just begun and will take a long time.
The US was India’s largest trade partner in 2021-22 with bilateral trade worth $119.42 billion with Indian export at $76.11 billion and import at $43.31 billion. Here, the trade deficit is tilted in India’s favour but equally true is the fact that both countries need each other’s markets. The world including the US are looking for an alternate manufacturing location, trying to reduce dependence on China, and India, with a big industrial base, is a viable option. Also, India, with a huge market base, surpassing China as the world’s most populous country, is a good export destination for US-based multinational companies. Likewise, the US, a big consumer market, is a good business destination for India. Besides, both countries are converging on many multilateral platforms like the Quad, the UNSC reforms, and India’s entry to the NSG.
Like with Russia, with China and the US, India diplomatically is taking a calculated approach. It clearly conveyed to Europe that it doesn’t need international support on ongoing border tensions and India-China ties with India’s stand on the Russia-Ukraine war. India’s foreign minister S Jaishankar said India was capable of managing its ties with China on its own and slammed Europe for this approach. At the same time, denying China’s appeal, India clearly conveyed that bilateral relations between both countries cannot return to normal unless China takes corrective action.
The US is replacing Russia as India’s major defence partner. The country always supports India’s permanent membership in the UNSC and NSG. But there are differences as well like WTO trade issues, some existing trade barriers between both countries and trade protection policies. Following an independent foreign policy, driven by its internal policy preferences, India has clearly said no to the US on many issues, like it doesn’t support WTO moves pushed by the United States on healthcare and agricultural supplies in global supply chains, and is not willing to join the trade pillar option of the Indo-Pacific Economic Framework for Prosperity (IPEF), an initiative pushed by the US. It is not comfortable with the language put by the US in the framework.
India is going to preside over G20 meetings for the coming year, setting its agenda, and it is expected to play a diplomatically assertive role in reinvigorating and strengthening ties. It has set the tone by saying that the Global South, largely ignored, will play a key part in deciding the framework ahead. India is an economic power that every country needs, be it China, the US, Russia, Japan, Australia, European nations, or the countries of the Global South. Indian diplomacy is expected to play a balanced approach of soft power appeal and hard policy considerations keeping these positive factors in mind. The G20 presidency is expected to be India’s first step towards establishing itself as an assertive independent foreign policy mover globally.
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