Carefully, step by step, the policies of the present government in India are focused on removing blocks to exports from India.
After the newly elected President of Sri Lanka made his first overseas visit to India and thereby stood by traditional Sri Lankan diplomacy, Prime Minister Narendra Modi will repay the gesture by being the first foreign leader to visit Sri Lanka since the new dispensation took over in Colombo. More than successes, it is failures that contain lessons for policymakers, the economic effects of relying on China have become obvious to the common citizens of Sri Lanka, Nepal and most recently Bangladesh. In contrast, close relations with India have resulted in economically beneficial outcomes. The collapse of SAARC as a functioning organisation as a consequence of the machinations of the Pakistan army contains lessons for the leaders who gathered in Bangkok for the 6th BIMSTEC Summit. The dismal trajectory of Pakistan has become a regional cautionary tale, as the growing mayhem in what was once a prospering country is making the life of citizens more and more difficult. The very mention of the joint operation of the Mukti Bahini and the Armed Forces of the Republic of India in 1971 may have been expunged for the moment from college textbooks. The reality of that military operation, which resulted in the rout of the Pakistan army that had soaked its hands in the blood of many millions of innocent Bengalis, cannot be covered up by doctored history. There was an ethnic, indeed a racial, arrogance in the way in which Chief Martial Law Administrator General Tikka Khan in Rawalpindi ordered his forces to run amok in what was then East Pakistan. They promptly embarked on an orgy of loot, mass murder and rapine that the self-declared “International Community” comprising both sides of the Atlantic not just ignored but actively facilitated. The role of the Nixon administration in repaying Pakistan by supporting the genocide in East Pakistan for being the middleman between the initial interchanges President Nixon and his National Security Advisor Henry Kissinger were having with Mao Zedong, was contemptible. The reality was that the US administration was walking through a wide open door. Mao Zedong was eager for better relations with the US, and had been since he began souring on the Soviet Union in the 1950s. Mao was never happy at playing a vassal role, and in his view, that was what Soviet leaders had assigned to the People’s Republic of China. He would have accepted any interlocutor between Nixon and himself, and not Pakistan in particular. Nixon and Kissinger developed what could somewhat indelicately but accurately a schoolboy crush on Mao, and in the case of Kissinger, with the ever suave Zhou En-Lai as well. China never looked back since then, taking advantage of every geopolitical opportunity provided to it in its climb to economic superpower status by the advent of the 21st century. The trajectory of China since the period when Deng Xiaoping took over effective charge of the CCP by the close of the 1970s is a lesson for policymakers everywhere.
India had a dismal record of recognizing and taking advantage of geopolitical opportunity, although there was a period of innovation in economic policy shown by Prime Minister Narasimha Rao, but within the third year of his five-year term, Rao froze much of his efforts at economic reform as a result of opposition to them even within his own Cabinet. The tragedy of Rao was that President Bill Clinton spurned his efforts to enter into a partnership with Washington, preferring Beijing to New Delhi. A historic opportunity was thereby lost by Clinton, who lavished such favours on China as to allow its entry into the WTO even though it was (and has remained previously and ever since) far from being a market economy. When he became General Secretary of the Congress Party, Rajiv Gandhi was initially keen on reforms such as party elections, but such impulses were snuffed out by establishment members of the Congress Party who correctly understood that such reforms would weaken their political strength considerably. Such unwillingness to grasp geopolitical advantages began to change when Narendra Modi took over as Prime Minister of India in 2014. By that time, the risks posed to long-term US interests and security from a rapidly rising China had become obvious to the US, who therefore responded far more warmly to the outreach of PM Modi than had been the case earlier. The quality by PM Modi of adjusting to geopolitical change has been very much on display the past week, with his visits to Colombo and Bangkok. After being to Bangkok, he stopped over in Colombo and worked out a series of understandings with President Dissanayake. The new administration in Colombo has acted correctly in not placing most of its interests in the PRC basket, given that this is the era of Cold War 2.0 principally between China and the US. As for the tariff firestorm ignited by President Trump, India has responded not in the panic or hysteria exhibited by some other countries, but soberly. The Commerce Ministry statement on the tariffs just imposed by the Trump administration is a model of diplomatisse. Rather than respond immediately with tariffs of its own, the Commerce Ministry has avoided the retaliatory path and acted in accordance with the bigger picture of growing congruence between the US and India. President Trump may have erred in putting friends and foes in the same basket, to the benefit of the latter. While much has been said about the benefits of the process described as globalisation, the reality is that practically all of labour from the Global South has been excluded from such a process. Even in matters such as services, curbs have been put on export of services by India to markets in economically advanced countries. As a consequence, several of their manufacturing and services units have suffered a deficiency of manpower. The consequence has been a flood of illegal migration from countries where everyday skill sets are way below those possessed by citizens of India. Had the Atlanticist countries followed a rational rather than a restrictive policy on migration from India, much of the travail and economic deficiencies that are being caused across both sides of the Atlantic could have been avoided. Carefully, step by step, the policies of the present government in India are focused on removing blocks to exports from India. It bears mention that several countries such as China and parts of Southeast Asia levy much higher tariffs than the US does even after the Trump tariffs on India come into effect. Changes in regulatory and fiscal policies could minimise the downside of such US tariffs, and these would be under active consideration.
Keeping an even