New realities in the world order

While Narendra Modi’s immediate task will be to focus on bailing India out of its current economic crisis, it would be a mistake to ignore the massive shifts the world has undergone while India was caught up in election fever

Sometime in 2005, goes the story at the Indian Embassy in Beijing, the then Gujarat Chief Minister Narendra Modi got in touch as he wanted to visit China and study business and investment opportunities. The Ministry of External Affairs in Delhi was cold to the idea, given the taint of the Gujarat riots of 2002, while the Embassy was unsure of what kind of protocol Mr. Modi could receive as no dignitary was available to meet him.

Mr. Modi’s reply startled them as he said his was a “study tour,” and if they wished to, they could treat it as a personal visit. Officials describe how Mr. Modi arrived a few months later, on his own, armed with only a notebook and pen. Gujarati businessmen helped open a few doors for him, but for the most part Mr. Modi travelled to state capitals and economic zones like Shenzhen, taking furious notes. At the end of his visit, Mr. Modi said that he had been struck by three things — the importance of economic diplomacy, the marvel of urban planning (his plan for the Sabarmati riverfront possibly came from here), and the fact that China was hampered most by the lack of spoken English in the country.

Driven by trade

Each of these impressions has had lasting impact on Mr. Modi, who made four official visits after the first one to China, and was even received in the Great Hall of the People in 2011. He has made it clear that his foreign policy will be driven by trade and boosting investment in India. Mr. Modi’s ideas include getting Indian States to drive investment by engaging with foreign countries directly (à la ‘Vibrant Gujarat’), having an economic officer in every Indian embassy (a hint that non-service officers and businessmen will be enlisted for the job), and a key goal, according to reports from his team, of raising India’s ranking in the World Bank’s “Ease of doing business” index from the current 134 to less than 100.

Global power structures

As Chief Minister, Mr. Modi was able to keep the focus on business in bilateral ties. In the midst of the border row with Chinese troops and the anger over stapled visas for example, he paid a visit to Beijing and Shanghai, to speak of R&D investment from Huawei and a deep sea port for Gujarat. Despite tensions at the Line of Control in July 2013, Mr. Modi had an official delegation from Pakistan to discuss solar energy projects. On visits abroad too, he has confined himself to countries where business opportunities are most viable — China, Japan, Israel, Singapore and Australia. But for America’s visa ban, the United States would undoubtedly have been high on that list. The new External Affairs Minister, Sushma Swaraj, has certainly taken the same cues from here. As she kicks off her bilateral meetings with a visit from Chinese Foreign Minister Wang Yi this weekend, she has yet to confirm whether she will give any time to the U.S. Assistant Secretary for South and Central Asian Affairs, Nisha Desai Biswal, at the same time.

However, while Mr. Modi’s task will be to focus on bailing India out of its current economic crisis, it would be a mistake to ignore the massive shifts the world has undergone while India was caught up in election fever — to begin with, the situation in Ukraine, a lightning rod for what is now called “Cold War 2.0” between the U.S. and Russia. While the unrest in the country may ease up after the presidential elections, and the impending withdrawal of Russian troops from the Ukraine border, there are even more far-reaching consequences for the new Indian administration to study. Russia’s annexation of Crimea has not only changed the map in the most dramatic way possible, but has also changed power structures in the world, with Russian President Vladimir Putin gaining the upper hand. In their campaign against Russia at the U.N., U.S. and European Union officials have warned that Mr. Putin’s actions hold a dangerous precedent for India too, especially when it comes to possible designs by China on parts of Arunachal Pradesh. Conversely, the actions of western diplomats and U.S. non-governmental organisations in Ukraine, who openly supported anti-Russian protesters to oust their government while attempting to pull Ukraine into the EU, is also a dangerous precedent for the world. Mr. Modi will face his first look at all these new realities in mid-July, when he meets Mr. Putin at the BRICS summit in Brazil, and when the world, especially the U.S. and EU countries, will be watching his statements.

BRICS Summit

The BRICS summit will also be an occasion for Mr. Modi to meet Chinese President Xi Jinping, and set the course for India-China ties. Chinese think tanks and newspapers have hailed Mr. Modi’s electoral victory, and chosen to downplay his campaign speech on China’s “expansionist mindset.” Yet, China’s actions in the South China Sea in the past few months will be, like Crimea, another talking point in Brazil. The latest stand-off has been sparked by China building an oil rig in waters that Vietnam lays claim to. Tensions have also been building with Japan, the Philippines and Vietnam over China’s increasing claims on airspace and maritime boundaries in the region. For its part, India has resisted joining the argument. But once again, the world will be scrutinising the interactions between Mr. Modi and Mr. Xi, more so Japan’s Prime Minister Shinzo¯ Abe, who has welcomed Mr. Modi to Japan in the past and made glowing references to him in the just concluded “Shangri-La” Dialogue conducted by the International Institute for Strategic Studies (IISS) in Singapore. When Mr. Abe won his 2012 election, Mr. Modi was one of the first to congratulate him. Mr. Abe even follows Mr. Modi on Twitter (significant because Mr. Abe only follows three accounts). The two leaders spoke for 15 minutes when Mr. Abe called to return the greetings on Mr. Modi’s win. It will be important to see how he balances Japan’s concerns with his own old relationship with the Chinese leadership.

Perhaps the most significant discussion at the BRICS summit, however, will be over West Asia, and nuclear talks between Iran and six world powers (the U.S., the United Kingdom, France, Germany, China and Russia) that hope to reach some conclusion in July. If the talks succeed, it could rewrite history, given the far-reaching consequences on the oil economy, nuclear energy and Arab-Persian rivalry in a region that houses and employs six million Indians. The talks so far have been ignored in the din of the election, but repercussions, including the anger of U.S. allies, Israel and Saudi Arabia, will have an impact on South Asia as well.

Finally, there are all the significant developments in India’s neighbourhood — Afghanistan’s historic elections that will possibly confirm front runner Dr. Abdullah Abdullah’s victory in June; Pakistan’s talks with the Taliban, and the rise in attacks on the media.

Inviting all South Asian Association for Regional Cooperation (SAARC) leaders to Mr. Modi’s swearing-in is certainly a nice touch to start with, and hopefully heralds India’s re-engagement with a world it has effectively shut out during nine months of what has perhaps been its longest campaign. For Mr. Modi, unlike his experience of 2005, the welcome mat is no longer a problem, but the new Indian Prime Minister may want to keep that notebook and pen handy as he sets out to deal with new realities in the world order.