India needs a world view as great powers shift approaches and alignments

by Mukul Sanwal

The BRICS Summit comes at a time when the purpose and existence of the multilateral system, European Union and military alliances is being questioned even by the proponents, creating a vacuum; China seeks to “lead the reform of the global governance system with the concept of fairness and justice”; and, India aims to be a third pole of the emerging world order, as a rule-maker and not a rule-taker.

In five areas hard choices will be needed that do not respond to short-term bilateral deals – Iran is an example – but shape ties based on global trends and the related vision of longer-term interests.

The first strategic issue is understanding geopolitical shifts as an ‘unwinding’ of the post-world War II order or ‘reversal’ to the situation that existed throughout civilisation, except for the last 250 years. With two-thirds of global wealth again to be in an integrated Asia, how we look at this transition determines how we expect bilateral relations to evolve. Instead of focusing on great power competition, India’s exceptionalism, relevance and influence in the international community will be addressing the growing environmental challenges that everyone faces relegating traditional strategic considerations to a position of lesser importance.

Second, strategic autonomy, in a connected and interdependent world, has to be embedded in reform of global governance. The choice is whether to see the United Nations or ASEAN as the bedrock. The Indo-Pacific, with ASEAN at its center, needs to be defined as a regional concept for shared prosperity, not security chessboard, and the consensus then extended to transform the United Nations and WTO. India can provide a conceptual framework of equitable sustainable development to replace the fraying liberal order; it has already made a beginning by re-framing climate change in terms of ‘climate justice’ and the new format of the International Solar Alliance.

The third element is considering the impact of China’s Belt and Road Initiative (BRI) in perspective. The BRI is more than projects covering over 70 countries, 4.4 billion people and 40 per cent of global GDP with connectivity, pipelines, telecom, and currency and sharing benefits of space. Nearly two-thirds of these countries have a sovereign credit rating below investment grade yet need infrastructure finance which no one else will provide. The BRI is very much ‘debt diplomacy’ on the lines of World Bank loans, raising similar questions and where project cost-benefit analysis does not apply. The key precedent is not Sri Lanka, whose debt is three-quarter of its GDP but only a tenth is owed to China, but Australia. In 2015, immediately after an MOU for infrastructure co-operation in third country BRI projects a Chinese company bought a 99-year lease on the Port of Darwin.

China’s BRI is really a development model remaking trade relations reminiscent of the West withdrawing from the GATT and pushing developing countries into the WTO in 1995 while bringing in services and intellectual property rights. The recent U.S. National Security Strategy focuses on restricting China’s access to cutting-edge science and technology, and has the tacit support of the EU. At a time of flux, global powers establish new rules, as both Trump and Xi are doing, because influence now depends on evolving technological capacity, not military might.

India needs a multipronged response to the BRI. It should participate in the rule-making, just as it is an active partner in the China-led Asia Infrastructure Investment Bank, and do what multilateralism has done in the past by putting controversial projects into a special category. The BRI could be balanced by taking a longer-term view and joining the Regional Comprehensive Economic Partnership (RCEP), which is ASEAN-centric, covers 16 countries, more than 30 percent of global GDP and 50 percent of the population, effectively creating two poles in Asia. 

The fourth element should be laser-sharp focus on double-digit GDP growth for breaking into the $5 trillion economy. The draft Defense Production Policy, 2018, to make India a global leader in Cyberspace and Artificial Intelligence technologies is a step towards self-reliance, without which a country cannot be a global power. Future wealth and influence will depend on India becoming a technology powerhouse leading in software and biotech, and competitive in high-tech manufacturing, robotics, new energy-vehicles, chips and other leading-edge industries.

American and Chinese companies are already fighting for global digital supremacy through the Indian market, transplanting services and buying start-ups. Online data provides the fuel for artificial intelligence and leads to profits as well as dependencies if it flows outside the country to these powers, with geopolitical implications. India has to make hard choices as it pushes its own technology companies to be global champions by securing its data, including with government-led frameworks like Rupay, Aadhar and the National Health Stack. Overcoming India’s ‘middle-income trap’ needs a third techno-bloc with digital public goods and ASEAN and Africa as key partners.

Fifth, the shift from a ‘leading’ power to a global power is not just a geographical concept and incorporates a range of policies, instruments and choices. The way India relates to the neighbourhood must change by focusing on trade and regional institutions like ASEAN and the Indian Ocean Rim Association with a modified 2+1 framework suggested by China, as the region is keen to have relations with both. A multi-polar world is defined by multiple powers competing and cooperating with each other.

There is no need to be unsettled by the scope and pace of China’s re-emergence and policy shifts in the United States. India is also a civilizsational state with the potential to overtake the United States, just that current academic models do not explain this ‘reversal’. The BRICS are challenging a system the West built in its own image to serve its interests, and the Retreat during the Summit provides the forum to lay out a conceptual framework of the alternative.