by Sajid Farid Shapoo 31 January 2021
As the world emerges out of the year 2020, ravaged and poorer, the specter of the past year’s crises would continue to influence the trajectory of events for this year. This is particularly true for India. It will continue to face the twin challenges; one, the pandemic, Himalayan in its proportion, and second, the unabated standoff with China, its Himalayan neighbor. The enormous task of managing the pandemic that has severely impacted India’s most vulnerable communities can easily spew new and complicate existing economic, social, and political challenges. India’s second towering challenge in the form of the continued military standoff with China may get further complicated due to the pandemic’s direct and indirect effects.
Other equally salient challenges would need the government’s attention; these include internal security threats in the form of terrorism, Maoist insurgency, farmers’ agitation, and the unabated social unrest that threaten to rip apart the social fabric of the country. However, the complex and strategic interaction of the pandemic’s challenges and the external security threat across the Himalayas make 2021 a particularly tough year for India.
Some experts claim that even with the second-highest COVID-19 infections globally, given its population density and public health preparedness, India seems to have dodged the corona bullet. However, the virus’s overall spread and containment measures have severely disrupted the country’s supply and demand dynamics. A World Bank report estimates that though the economy may rebound to 5.4% for the fiscal year 21-22( assuming that all COVID-related restrictions are completely lifted), the adverse impact on the livelihood will be much steeper than the GDP forecasts.
Besides, India-China relations will remain foreseeable strained for most of 2021. The fact that the new incumbent Biden administration will take time to put its China policy inaction, India needs to prepare itself to deal with an increasingly assertive China in the wake of the ambivalent United States coupled with the economic and social consequences of the Covid-19 pandemic. These challenges are not isolated; one has a bearing on another.
The fait accompli presented by China in the Galway Valley of Ladakh in early 2020 and the later developments once again brought to the fore the overall inadequacies in India’s defense preparedness, particularly in terms of its force projection capabilities and gaps in its military hardware. Though India hastened to upgrade its military hardware, the grim economic projection for 2021 may derail this process. The steep projected fall in the overall GDP is bound to shrink the defense outlay in real terms. Though not particular to India, the fiscal squeeze due to pandemic can adversely impact its military modernization program regarding equipment purchase and infrastructural up-gradation. Reeling under the pandemic’s impact, India’s GDP shrunk by over 23% in the first quarter of the year and further by 7% in the second quarter. The precarious economic projection would definitely impact India’s ability to sustain both a high defense outlay and a tough stance against China.
Beyond the costs in terms of human lives and disease affliction, the pandemic’s devastating effects are now apparent in other sectors. International Monetary Fund’s recent reports on the World Economic Outlook estimates that over 40 million Indians may fall into extreme poverty due to pandemic. As the pandemic’s effects and hold loosen, people would aspire to go back to the pre-COVID economic and social status, which is practically impossible for any state to achieve in the immediate short term. With private consumption falling by 27% and investments down by 47%, economists estimate that it will take India ‘years’ to recover from the pandemic’s adverse impact. Such a situation may further fuel internal strife and exacerbate social faultlines. The pandemic has already shown us how the virus was used to target society’s vulnerable sections byways of social and economic boycotts. Such a precarious domestic economic, and social situation can compromise India’s ability to shore up its defenses even in the short term. Moreover, at times governments have been seen willing to indulge in external adventurism to deflect attention from the domestic sphere- an unmistakably risky recourse.
India’s stance on China would also depend on the kind of signals and support it gets from the Biden administration. India received considerable support from the Trump administration in the 2017 Doklam standoff and the current crises. The West’s growing voices that the U.S. should forge a deeper strategic alliance with India gel with India’s emerging view being seen as a natural ally of the United States and a bulwark against China in Asia. However, India realizes that such an alliance, even if formed, would be a far cry from the Cold War alliances that the US forged with Europe and Japan. The U.S. no longer enjoys the same hegemonic status as it did decades ago. Trump’s Presidency further dealt a crippling blow to it. Its European partners no longer see the U.S. as a dependable ally. There is also a growing realization that Quadrilateral Security Dialogue(Quad)- comprising of India, United States, Australia, and Japan- as a multinational alternative to China will take a while. The pandemic’s adverse impact on Japan’s economy combined with Shinzo Abe’s exit has toned down the euphoria around the Quad. India will thus need to deal with its issues with China more independently and bilaterally.
Moreover, as India realizes that it would be difficult to coerce/convince China to restore the pre-April Status quo, some domestic voices in the form of pressure groups want India to engage in a limited show of force. The realistic escalatory potential of any such limited conflict may be not only disastrous but also prohibitively costly for both countries.
For India, the internal and external policy landscape in 2021 would be shaped by its ability to resolve the two strategically interconnected challenges; its ongoing border standoff with China and its ability to limit the economic and social disruption caused by the pandemic.