Narendra Modi’s foreign policy masterplan

11 May 2016


The general election held in India back in 2014 was one of the most defining in that country’s history, marking not only the end of the Congress Party’s decade-long rule, but the first time that a party other than Congress had won a majority of seats in the Indian parliament. Voters gave Prime Minister-elect Narendra Modi a strong mandate to confront social ills such as poor infrastructure, political corruption, and endemic poverty, and his chances of re-election will be determined by his success or failure in making India a wealthier, more equal society. Indeed, Modi made improving the economic situation a key plank of his election campaign, and there is little doubt that his handling of the Asian continent’s third biggest economy will play a fundamental part in determining his chances of re-election. It is perhaps for this reason that Modi has made international affairs a major focus of his administration. As recent developments have suggested, it is Modi’s strong emphasis on foreign policy that will not only have the most lasting impact on Indian society, but will prove to be the key factor in shaping his political legacy.


Since becoming prime minister, Modi has pursued an activist foreign policy agenda aimed at bolstering diplomatic and economic ties with his neighbours, while making India more open to international business. Modi has drawn much criticism for his approach, with detractors deriding him as India's first “non-resident prime minister,” although his focus on external affairs has to date been beneficial to India for strategic and economic reasons. Establishing close relations with other nations is not only vital for securing regional stability, but also serves as a catalyst for long-term economic development through access to new overseas markets. Last year alone, India received over $19 billion worth of foreign investment from the 12 countries that Modi has visited in the past year, while, by reaching out to world leaders, he has secured more than $400 billion worth of overseas investment commitments. As a result of much-touted schemes such as the “Make in India” campaign, in conjunction with the liberalisation of the Indian economy, foreign direct investment (FDI) inflows have hit an all-time high in early 2016 foreign direct investment (FDI) inflows have hit an all-time high in early 2016 net direct investment inflows reached a record high earlier this year; resulting in the country’s basic balance returning to a surplus for the first time in over a decade.


Indeed, the “Make in India” campaign, which was launched two years ago to encourage international companies to invest in India, has wielded a number of positive results. Towards the end of 2015, Chinese smartphone maker Xiaomi set up a manufacturing centre in India (the company’s largest market outside China); a decision that will lead (as predicted by various analysts) to India replacing the United States as the biggest smartphone market in the world. Hyundai and Airbus have also announced sizeable investments in India as part of a worldwide business expansion plan, while General Motors is planning to make investments worth $1 billion within the next few years. If such trends continue, then the Modi administration may not only fulfil its aims of creating 100 million factory posts by 2022 and swell the ranks of the Indian middle class, but achieve its vision of transforming the country into a worldwide manufacturing hub.


Although many of Modi’s actions abroad appear to have revolved around his attempts to accelerate the Indian economy, his international agenda has proven itself to be productive in other respects. India took an important step recently in the field of climate change by committing itself to last year’s Paris climate deal; a move that will surely increase the chances of the agreement’s success. Disaster relief schemes and humanitarian aid were swiftly carried out in the wake of an earthquake in Nepal, while an operation undertaken to rescue thousands of Indian citizens from conflict-torn Yemen was met with international praise. This is an indication, perhaps, of how many nations have come to view India as an important player on the international stage.


Greater ties have also been forged between India and the United States, as demonstrated by the former recently expressing its support (in principle) for the Logistics Exchange Memorandum of Agreement. This agreement will benefit America from a strategic point of view by providing its warships and aircraft with access to military bases in India for logistical purposes, while India is set to benefit not only from similar access to American bases but, as a result of exchanges in logistics support facilities, an expanded strategic role in the region as well. Even if India were to eventually sign this agreement, however, this would not express a willingness on its part to abandon current partnerships with other nations. When China and Russia expressed reservations over growing cooperation between India and America, Modi visited both countries to allay their fears by arguing that this agreement does not represent a path towards a military alliance between India and America, but rather co-operation on humanitarian concerns. By preventing a cooling of relations with two major allies, Modi is playing a careful balancing act; one that may enable India to acquire closer links with what is still the world’s leading superpower while maintaining its ties with traditional partners overseas.



India has also greatly improved its relations with neighbouring Bangladesh by finally ratifying the Land Boundary Agreement; a deal that had been waiting in the wings for at least four decades. It is hoped that this will settle a long-running land dispute, one that has denied 52,000 residents of enclaves access to the public services they need. This dates back to an old treaty between two princely states, with 92 Bangladeshi enclaves in India and 106 Indian enclaves in Bangladesh which are classified as foreign soil in both nations. Under these agreements, however, residents will finally be able to decide which country they wish to be a part of, hopefully putting an end to the misery long suffered by the people of these enclaves due to their disputed identities.


None of these accomplishments mean, however, that Modi’s record in foreign policy has been an unbridled success. Relations between India and Pakistan remain frigid due to issues such as terrorism and disputes over the Kashmiri region. Modi has been accused of adopting an aggressive stance towards his smaller neighbour, while criticisms have also been made of Modi’s approach towards civil rights. Last year, several writers returned their Sahitya Akademi literacy awards (prestigious honours for authors in the country) in response to Modi’s refusal to condemn the murders of two writers who questioned aspects of Hinduism. Here in Britain, Members of Parliament have debated Modi’s commitment to religious tolerance due after he denied a visa to an American Commission on International Religious Freedom and failed to condemn violent acts against people of different religious faiths. One Lord has called on the British government to reconsider supporting the country’s claim to a permanent seat on the UN Security Council. Such developments have not yet resulted in a souring of relations with America and the United Kingdom. But if Modi fails to do more to safeguard the country’s religious minorities from violence and hatred, then the two countries may in time reconsider their relationship with India. Modi needs to do more to tackle sectarian violence at home and preach against hate and discrimination in all their forms if he hopes to not only maintain his ties with Britain and the United States, but to ensure that his efforts to attract foreign investors to India do not fall into ruin.


In spite of its deficiencies in areas such as discrimination and Indo-Pakistani relations, where much work still needs to be done, there is nevertheless much that can be commended in the Modi administration’s foreign policy agenda. In building bridges with neighbours, promoting foreign trade and investment, and spearheading humanitarian operations, Modi has pursued a foreign policy strategy that has not only done much to enhance India’s standing on the global stage, but could pave the way to a more prosperous future for the Indian people as a whole. That in itself is a legacy to be proud of.


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