View: PM has to arrest the current drift to align India and US strategically


    India always has had both size and economic potential, which found expression through the past two decades.

    The PM has to arrest this drift to align India’s principal partner under the umbrella of greater strategic congruence.
    Domestic stability is the one constant that the Prime Minister Narendra Modi has while dealing with an unstable world. This is rare for a recent Indian PM, and a huge asset for Modi at a time when India looks to benefit from a flatter, looser, less disciplined global order.

    In fact, India is quite possibly at the cusp of a big strategic moment in history. The question is whether it can position itself to emerge as the biggest gainer. China did it in the 1970s and 1980s when the US and former Soviet Union competed for global supremacy.

    Asean countries showed how a regional bloc can leverage global political and economic transition to its favour through the 1980s-90s. Some of these countries could raise their economic profile and living standards to those of the developed world, thus wielding influence well above their size.

    India always has had both size and economic potential, which found expression through the past two decades.

    However, for reasons more structural —and, at times, political — the big moment has always eluded India. The India-US nuclear deal held out that promise.

    But many of its next steps, including membership to the Nuclear Suppliers Group (NSG), remain unfulfilled. Modi’s new mandate allows him to make a bid for that big India moment.

    His mandate — and it’s a mandate for Modi, the PM — gives him the licence to go full throttle. And going by some of his bold Cabinet appointments, including the choice of former foreign secretary S Jaishankar as external affairs minister, it’s clear that the PM is thinking strategic, not just political.

    Through the last decade, the international environment was conducive for India’s growth. It was argued that India’s rise was in the global interest, as it furthered the goals of a liberal international order, as opposed to China’s rise. A significant part of this picture altered with the US presidentship of Donald Trump. He has ushered in a new brand of US economic nationalism, which has considerable traction within the US. Old institutions that were once pillars of the liberal international order are now under stress.

    There is uncertainty looming large on whether the US can even guarantee the global commons.

    People Unlike US
    The disruption in the US, and continuing rise of China — which, interestingly, now speaks of protecting global economic institutions — has reached a point of conflict. Like it or not, China is now a political demon in US domestic politics that even the Democrats find difficult to embrace.

    This has huge consequences. US companies are already looking at diversifying their supply chains, create viable options that insulate them from political conflict. Most western economies are likely to follow the lead.

    It’s important not to confuse this with some kind of new ‘Trump model’ for global leadership. These are economic and commercial responses to political turmoil in the US, as individual states in the US and business entities look for solutions despite a divided Washington.

    India presents itself as a great option as a benign power with rich human resource. Not many governments have been re-elected after implementing a revenue reform as disruptive as GST. This puts Modi in a strong position. His efforts to unify the Indian market into a seamless economic entity are all steps in the positive direction.

    But using the PM’s own formulation, with size, scale and speed are also needed. India needs to scale up really fast. That, in many ways, is also the core message of the 2019 election mandate. What that means on the international stage is to show intent, intensity and urgency.

    For that, India needs to show agility that can only come by projecting itself as a power with least problems, one that can adapt to do business with any country regardless of affiliations. The gradual loosening up of the global order has made the world stage resemble a marketplace where deals are struck and transactions consummated on a daily basis. There’s no such thing called a political untouchable.

    In this flux, it’s important that India doesn’t get entangled in long-drawn ideological battles over trade and sovereignty with the US. Because politics aside, the fundamentals of the India-US relationship have never been stronger. Despite that, both sides have failed to hammer out a trade deal due to an unpredictable Washington and a suspicious New Delhi.

    The two countries have worked closely on Pakistan-based terrorism, but are yet to bridge the gulf of doubt when it comes to a US deal with Taliban for troop withdrawal from Afghanistan. There are other disagreements, be it withdrawal of generalised system of preferences (GSP) benefits, purchase of the S-400 Triumf anti-aircraft weapon system from Russia, or India’s e-commerce policy.

    A New Beginning
    But these are issues that can arise among partner countries. The point is to not allow them to disturb the big picture.

    The PM has to arrest this drift to align India’s principal partner under the umbrella of greater strategic congruence.

    Just as India will also have to develop on its political conversation with China so that Beijing recognises the political logic of being accommodative to India’s growth.

    In sum, the coming years could be defining for India. The challenge will be to read and anticipate the global change accurately, to achieve that historic turning point — the strategic moment, for which Modi is politically best placed to execute.
    (Catch all the Business News, Breaking News Events and Latest News Updates on The Economic Times.)

    24 Comments on this Story

    Amit Sharma482 days ago
    Well timed title.India needs USA for its economic development, Strategic depth, and defence indigenization. Historical lessons and long tern trends are a powerful backdrop for any future planning. India''s democratic institutions, require the support of USA for the next 10-20 years for modernizing and aligning up with our global ambitions. Meanwhile USA is the obvious and best bet for quarrentining the security threats from our neighbourhood.
    Surendra Ahluwalia484 days ago
    e have to under stand one thing about us , come but what us will do what ever it takes , that is 10% OF its population(rich people)to maintain statusco. Indians are smart enough to tackle and overcome this US facts.
    Aditya Sinha485 days ago
    Land and labour reforms must
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