Indian Foreign Policy: Problems and Prospects

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There are three main determinants of foreign policy: people, history and geography :

  • People- identity, values, aspirations and skills
  • History-  circumstances, opportunities and constraints of the past
  • Geography- location, resources and neighbourhood

India was an old civilization with great cultural resources which, however, was stratified socially, economically and politically. Three major developments changed the character of India:

  • The  direct involvement of the masses in the freedom movement in the first half of the 20th century with independence in 1947 and, in spite of the Partition, an identity as a secular nation.
  • The ambition reflected in the Preamble of the1950 Constitution to form an egalitarian, secular, socialistic-type just society focused on the social and economic development of the people and politically united into a democratic republican nation.
  • The economic reforms of 1991, liberating the trading and entrepreneurial spirit of the people
  •  The near coincidence in time of Indian independence and Partition, the beginning of the Cold War in the aftermath of the World War II and the Communist victory in China created a difficult situation for India. It led to a foreign policy of non-alignment as a means of retaining strategic autonomy combined with an effort to create solidarity of Asian/ developing countries as a political support base.

In the wake of the Cold War, India’s pro-Soviet–tilt and Pakistan’s total support for the West as well as China’s occupation of Tibet, helped to exacerbate the neighbourhood tensions. In spite of trying to settle peacefully through the UN the Kashmir issue created by Pakistan’s aggression, the issue got converted there into an Indo-Pakistan dispute. Two wars, one in 1965 and the other in 1971, the latter changing the political geography of the sub-continent, and the respective peace agreements signed in Tashkent and Simla failed to resolve the problem. Subsequently, Pakistan started using terror as a state policy to try to force India to submit as part of its proxy war strategy.

India –China border dispute arising out of an assertive China unwilling to accept ‘imperialist- imposed’ borders, was not contained by the Panchsheel Agreement whereby India accepted Tibet as an autonomous part of China without demanding any tangible quid pro quo, such as acceptance of the McMahon line as the boundary. In fact, the offer of refuge to Dalai Lama in India in 1959 heightened Chinese suspicions, the breakdown of negotiations, and Indian ‘forward policy’, among other things,  saw China ‘teach India a lesson’ by attacking in 1962 which led to a humiliating military defeat for India. Chinese occupation of Aksai Chin and claims on Indian territory like Arunachal Pradesh are unresolved.

India’s ‘Hindu rate of growth’ – meaning growth dependent on natural biological growth, as Hinduism does not practice conversion, rather than any pejorative reference to the religion or its adherents – of around  3.5 % economic growth rate vis-a-vis our population growth rate of  around 3% during that period,  for most of the first half of the twentieth century under the British and marginally better from 1950s to 1980s meant in per capita terms almost nil growth rate implying very little capacity for national accumulation. The problems of illiteracy, disease and poor infrastructure were other constraints. This led to command economy policies (e.g., Second Five year Plan, etc). These meant not only ideological distaste for India but also its lack of attractiveness as a profitable trade and investment partner for the US business. Combined with India’s pro-Soviet tilt, it implied less than cordial relations with US. This was seen during the Bangladesh War and in the aftermath of India’s peaceful nuclear tests in 1974 when the US put in place a very strong nuclear non-proliferation regime both at home ( through Nuclear Non-proliferation Act, 1978, Pressler and Symington Amendments, etc.), and internationally through IAEA and NSG mechanisms.

The collapse of the Soviet Union in 1991changed the prospects for India. Forced to deal with a uni-polar world, India made new approaches such as its ‘Look East’ policy towards the miracle economies of ASEAN.. The rise of Indian software globally as well as the rise of Indian- Americans in US and the market-oriented reforms in India combined  with freeing US from seeing India through anti-Soviet prism gave a positive fillip to Indo- US relations. The end of the Cold War also reduced the importance of Pakistan in US eyes.  Even the nuclear tests of May, 1998 which made India declare itself as nuclear weapon country which initially led to US sanctions, did not prevent a change of approach on the part of the US noticed during the Kargil War with Pakistan in 1999 and reflected through the 2000 with President Clinton’s visit and the lifting of these sanctions in 2001. Relations between India and US can be said to have   really turned around with President Bush’s announcement in July, 2005 that the US would offer help to India in civilian nuclear energy. This led to the Indo-US Civil Nuclear Agreement.

The importance of the Indo-US Nuclear deal lies not merely in that it allowed supply of nuclear fuel and access to nuclear technology, important as they are for India’s economic development, but also in that it was contrary to the stipulations of the Non-Proliferation Treaty (NPT)  and, more significantly to the entire US non-proliferation efforts, domestically and internationally, in the wake of India’s 1974 test. Furthermore, it was also considered to be a one-time exception only for India. It meant that in the eyes of the most-powerful nation, India had arrived.  Furthermore, we share considerable common interests with the US and have a lot to gain from our partnership with them. However, we should not be carried away by any ‘Hindi-Amreeki Bhai-Bhai’ euphoria. We need to keep in mind the possibility of our being co-opted against China and nor can we afford US and China ganging up against us. Since it is also unlikely that we will side with the Chinese against the US, it would be in our interest to have a subtle trilateral   balancing interaction among India, China and the US.

At the same time, the increasing radicalisation of Pakistan and its near failed state situation poses a threat to India and, indeed, to the rest of the world. In particular, the discovery of Osama bin Laden in Pakistan among other events has rather adversely affected Pakistan’s image in the world and the economic support that it can expect from the external world.

The perception of India’s rise in the eyes of the external world is also visible in its economic growth potential. With economic growth consistently  in the range 7 to 8 % and even touching 9% in the three years before 2008, averaging  over the last twenty years nearly 8% growth rate and a per capita average growth of over 5%, as the population growth rate had dwindled to less that 1.6%.  This also seen in the savings rate rising steadily from less than 10 % until 1955, to around 33% over the last several years. Combined with the demographic dividend in the coming decades, India economic growth rate is expected to overtake even China’s. The famous BRIC reports of Goldman Sachs also corroborate the great potential for India’s rising economic stature in the coming years and decades. India is now in G-20.  However, India is still the poorest in G-20 and is expected to face increasingly acute scarcity of land, water and energy resources as well as environmental problems.

The fact that three out of the top four economies by 2050 would be Asian- China, India and Japan-, the other being the US, underscores the shift of economic power from the West to the East and the concomitant likely political power profile. It would also bring into focus developmental models based on authoritarianism versus democracy as well the importance of soft power. After all, India has right from the start been a model for other developing counties as what is possible in an open democratic governance system.

Overall, with the collapse of the Soviet Union in 1919, the on- going decline of Europe and the recent euro-zone crisis sharply denting the dream of United States of Europe,  the several hundred years era of  European domination is ending. Depending upon our leadership, India may rise to be among the top three global powers. But a global power status, including a permanent Security Council seat, without an inclusive growth at home, dignity and security for all its citizens cannot be our final goal.

Views expressed are his own and not of the Ministry of External Affairs