Satyajit Das :
The courtship of India by the U.S. and its allies in recent years, intended to offset the rise of China, is a clumsy attempt to compensate for the West’s declining military potency, economic weakness, flagging industrial competitiveness, aging population and sociopolitical divisions.
Founded on the simplistic premise that “My enemy’s enemy is my friend,” the Indian pivot is economically and strategically incoherent.
With less than 40% of China’s gross domestic product on a purchasing power parity basis, India cannot provide a meaningful alternative to the Middle Kingdom as a global growth engine.
True, India has been posting higher rates of growth than any other major economy, with the International Monetary Fund forecasting a 6.8% expansion this year. But rather than reflecting growing market prowess, India’s rising output is more about undoing the effects of COVID-era retrenchment and a function of massive government infrastructure spending.
Nagging concerns include growing public and private debt and a volatile current account deficit. Crony capitalism, multifarious obstacles to business and persistent corruption are well-documented issues.
The relocation of manufacturing operations to India to reduce reliance on Chinese production has proved difficult. Although labor costs are two-thirds lower in India, this has not compensated for poor education levels, low productivity and indifferent output quality.
India thus cannot offset China’s demographic decline in terms of cheap, abundant and able workers. While now the world’s most populous country with over 40% of its population under the age of 25, India’s fertility rate has fallen below the replacement level of 2.1 births per woman. And labor force participation is just 55% as only around one third of Indian women are in the workforce versus almost two thirds of their Chinese counterparts.
Nor can India realistically take China’s place as a market for Western products. The average income level is a fifth that of China, limiting demand even aside from New Delhi’s skeptical stance toward imports.
Defense cooperation is relatively fanciful as can be seen with the declining profile of the Quad security arrangement that brought India together with the U.S., Australia and Japan. India’s military is large but lacks adequate training and equipment. Its arsenal is substantially Russian, complicating interoperability.
Quad foreign ministers meet in New Delhi in March 2023: The public profile of the grouping has been declining. © ReutersIndia’s security focus is on its 6,800 kilometers of land frontiers with China and Pakistan. For the U.S., the priority is to get Indian assistance in protecting Indian Ocean transport routes crucial for Washington’s East Asian allies. But New Delhi’s blue-water naval capabilities are untested.
India must also deal with ongoing domestic civil conflicts. A lack of sufficient quality jobs for up to 12 million new job seekers each year could further foment social instability.
The notion that the relationship between India and the West rests on shared values is disingenuous. The V-Dem Institute, a Swedish democracy research group, classifies India as an “electoral autocracy,” setting aside the tired cliche about the country being the “world’s largest democracy.”
Politically motivated prosecutions of opponents, the persecution of religious minorities, curtailment of press freedoms and judicial interference have been on the rise. To be clear, though, such practices did not start with Prime Minister Narenda Modi.
Mahatma Gandhi himself was famously equivocal about Western civilization. The ideology of Modi’s Bharatiya Janata Party is aimed at establishing Hindu hegemony, which would be fundamentally inconsistent with secular democratic values.
In blatant disregard of U.S. and EU sanctions, India has become a top importer of discounted Russian oil, much of which it refines and reexports, generating substantial profit.
At the same time, Western pandering and official propaganda has encouraged Modi and ordinary Indians to believe that they are indispensable globally. As a result, India’s ever-uncertain enthusiasm for economic reform has faded, especially in relation to agriculture, business regulation, subsidies, labor markets and foreign investment.
India could also become more highhanded in its dealings with neighbors, particularly Pakistan, which may accelerate a regional arms race or worse. A sense of impunity already prevails as evidenced by alleged government complicity in murder plots against Sikh separatist leaders in North America. India has also allegedly engaged in spying in Australia despite the two nations’ ostensible alliance.
The West, especially the U.S., believed for decades that building ties with China would lead to economic and political liberalization. Instead, this outreach created an economic and geopolitical competitor.
The same could happen with India, which like China has always been ambivalent toward the West. Consequently, a more transactional approach, rooted in realpolitik, would be more appropriate.
On the economic front, the opening of the Indian market, in terms of encouraging freer trade and capital flows, would benefit all parties.
During India’s most significant period of liberalization, between 1991 and 2014, the country’s average import tariff fell from 125% to 13%. Under BJP rule since then, the average tariff has climbed to 18%. Under a monitoring system launched in November, importers must register shipments of laptops and other electronics and might later have to secure licenses to bring in such products.
Progress on Asian security will require adequate investment in military capabilities to deter threats. It will also ultimately require recognition of spheres of influence, dialogue, negotiated settlement of disputes and difficult concessions and compromises. The West cannot avoid facing up to the reality of Chinese power by tying up with India.
The unipolar world cherished by the U.S. is now past. The emerging multipolar world is not perfect. But without cooperation and coexistence, urgent existential problems like climate change, resource scarcity and military confrontation cannot be addressed.
Without China and India both taking part, efforts to reduce global carbon emissions will fail. Access to critical raw materials for the energy transition also requires pragmatism on trade.
The assumption of an inevitable convergence between India and the West could ultimately be as misplaced as was the earlier one about China. Rooted in an outmoded worldview, the West’s advances toward India could end just as bitterly.
Satyajit Das, a former banker, is the author of “A Banquet of Consequences: Reloaded” and “Fortune’s Fool: Australia’s Choices.”
source : asia.nikkei