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India in the new ‘World Order’

  • Categories
    International Relations: Growth & Connectivity
  • Published
    26th Apr, 2022

INTRODUCTION:

  • India is experiencing globally transformational events. It would be right to say that the gears and levels in geopolitics are changing at a rate faster than ever. It seems a far-fetched dream to expect a rule-based international order in the upcoming years. Instead, uncertainty and impermanence are likely to be the dominant aspect of world affairs.
  • History has witnessed a new world order after World War II, in which we are living now. After the Covid-19 pandemic, the world is quickly moving toward a new world order. India has to play a bigger role in the new world order emerging post the pandemic.

CHALLENGES OF CHANGING WORLD ORDER

Global Rise of Authoritarianism:

  • Authoritarianism and nationalism are on the rise around the world with governments becoming less transparent and losing the people's trust. And the pandemic has accelerated many of these trends. Lockdowns were sometimes excessive, politicised, or brutally enforced by security agencies. However, this can hardly be viewed as a new phenomenon.
  • China has abandoned the ‘one country two systems’ policy, stripping Hong Kong of its freedom and inviting international opprobrium.
  • The human rights violation of Uighur Muslims in Xinjiang and China’s aggressive posture toward Taiwan could well become one of the flashpoints of conflict.
  • The ongoing war between Russia and Ukraine — the latter being backed by the U.S. and North Atlantic Treaty Organisation (NATO) forces.
  • The current unrest in Kazakhstan further bodes ill for a world already wracked by a series of coups or internecine strife as in Ethiopia, Libya and certain regions of West Asia and North Africa.
  • Taliban’s return to power in Afghanistan has led to a material shift in the balance of power in an already troubled region on India’s periphery.
  • Developments in Afghanistan have fuelled the ambitions of quite a few ‘anti-state militant groups’ across the region.

Increasing Chinese Dominance:

The role of China is possibly the most disrupting one, given the challenge it poses to the existing international order.

  • Militarily, China is openly challenging U.S. supremacy in many areas, including ‘state-of-the-art weaponry’ such as hypersonic technology.
  • The dip in China’s economic profile in the past year and more could also lead to new tensions in the Asia-Pacific region in 2022.
  • Moreover, China’s expansionist policies via its Belt and Road Initiative are also being seen as a threat by other global powers such as the US, EU, the G7 countries as well as India.

Shift Away from Dollar:

  • Dutch, British and the US as world powers, which rose and fell over the last few hundred years, in the coming years China appears to be replacing the US at the top of the world order. This new world order has several ramifications for India.
  • This change in perspective will influence every outward-looking policy, from trade to defence. If enough people believe that the American dollar’s role as a reserve currency is over, countries will start keeping their reserves in other currencies.
  • The shift from the dollar to another reserve currency like the Chinese Yuan is not going to happen, because the yuan is not fully convertible and, more importantly, faces a trust deficit that cannot be bridged overnight.
  • But, as a space for alternate currency is emerging, it is time to push Central Bank Digital Currencies into this void to strengthen bilateral trade. This can also be done as a consortium of countries that want to remain unaffected by the currency wars that may ensue in the wake of the shift of the reserve currency.
Multilateral trade agreements or even FTAs with the EU that India is contemplating the need to have the CBDC exchange as a sub-text. Spain and Brazil have already replicated the UPI stack developed by India without so much as acknowledging it, but that is how the open-source works. Replication of the stack itself is a sign of leadership and interoperability possibilities in the future. This interoperability needs to be part of all future FTAs that India signs. This will not only help Indian exporters reduce the cost of trade transactions but will also reduce the friction that various trade powers may like to introduce through sanctions. It will allow India and other countries that want to be part of this open-source Global Payment Interface (GPI) to trade without artificial barriers being created by the western or other world powers.

Diminishing Relevance of UN:

  • The experience of over seven decades has shown, that its ability to make a difference, particularly in the peace and security areas is diminishing. There is an urgent need to revisit global establishments like the UN and its agencies. Only a sensible democratic process with strict discipline can bring some solace from the existing mess. India can play a major role in this. Something like the ‘Panchasheel’, emphasising mutual respect for each other’s territorial integrity and sovereignty, mutual non-aggression, non-interference in each other’s internal affairs and peaceful co-existence — which was evolved by India and China in the 1950s during the Cold War era will be applicable in the present context.

Terrorism and the Transformation of the World Order:

  • India is fighting the challenges of terrorism and expansionism with great courage and astuteness. India does not hesitate in taking tough decisions and has the political will to do so.
  • The need to address this terrorism has grown even stronger due to uncertainties hovering over our two neighbouring countries, namely Sri Lanka and Pakistan. India has given a stern signal to its enemies by conducting surgical strikes and airstrikes. This tells us that India is changing and can take the most difficult decisions and isn't reluctant to implement them. The government is leaving no stone unturned in strengthening the armed forces tasked with the security of the country.

Ukraine-Russia Conflict:

  • The Russia-Ukraine conflict has been complicated for two months and there is no sign that the war is coming to end. The world seems helpless when it comes to dealing with a situation. Even if the war stops, the world will never be the same again. The main reason for this paradigm shift in international equations is that Europe is witnessing an unprecedented mobilisation against Russia. The continent’s concerns have multiple dimensions. It came as a dark day in the history of mankind as a superpower possessing the largest arsenal of nuclear weapons has begun to behave like a terrorist.
  • Abstained on UN vote against Russia: India has taken a pragmatic view during the Security Council discussions. India has managed to hold its balancing act for another day, despite the considerable pressures from the West to get off the fence. It has insisted that the issues will have to be resolved amicably through bilateral discussions and perhaps this view has helped India to evacuate more than 20,000 people, especially students, from the war-torn regions.
  • India continued to buy Russian oil amid external pressure: Indian state refiners have been doubling down on Russian barrels that are being shunned away by European buyers since the beginning of the war in Ukraine. The U.S. had increased diplomatic pressure on India to stop buying Russian energy, but India did not fall for it.
  • India's clear message of not politicising India’s dependence on imported energy is also indicative that India is not willing to buy the idea of following the west when it has its national interest at stake.

Two of our neighbours are collapsing, one economically and the other politically:

Flux is always an important pivot in regional foreign policy in a multi-polar world.

  • Bring Sri Lanka closer by helping them link their rapidly falling currency with India’s central bank digital currency (CBDC).
  • Help their banking system by allowing Indian banks to acquire them.
  • Sign a new free trade agreement (FTA).

Establishment of the Quad Framework:

  • The establishment of the Quad framework with many others in line and the weakening of the UN system to arbitrate the issue of global relevance further strengthen the formation of new blocks. The Quad comprises India, Japan, Australia and the US.
  • India has also gone beyond the Quad and has deepened its bilateral ties with the Quad members. the Quad has provided an opportunity for its constituents to participate in different configurations with like-minded’
  • Through Quad, India can counterbalance China’s growing presence in the Indo-Pacific region, including its BRI (Belt and Road Initiative) which has led to its building port facilities in countries neighbouring India, giving rise to a sense of encirclement in New Delhi.
  • With the Quad, India can rise above its middle-power status and project its influence beyond the Indo-Pacific. Also, India’s Act East Policy and Extended Neighbour policy boost India’s engagement in the Indo-Pacific.
  • Economically, the Quad will also make India a preferred destination for investment, especially after the COVID-19 outbreak.
Except for India, the three other Quad member countries have been severely critical of Russia for its military aggression against Ukraine, but India has chosen to maintain distance. Now the Quad countries have accepted India's position. This also shows that relations of India with foreign countries are no longer dominated by external pressures.

India becoming a Global Hub for Innovation with a start-up Ecosystem:

  • Start-ups have the potential to catalyse India's integration into global value chains and create global impact. The government has been inviting businesses from other countries to seize investment opportunities as 'India is the place to be' with its accessibility, choice, openness and opportunities.
  • During the COVID-19 pandemic, India has emerged as a source of resilience and a trusted Partner and has tried to the best of its ability to meet all our international service commitments.
  • India's diverse business landscape, skilled workforce, relatively low labour cost and initiatives to boost infrastructure such as National Infrastructure Pipeline, GatiShakti, and National Monetisation Plan would certainly give a fillip to investments and yield good returns. The government’s significant commitment to Production Linked Incentive (PLI) schemes to create manufacturing global champions will bring scale and size to key sectors and generate employment.
  • This moment in history is the dawn of a new era—one in which India is well-poised to truly be the land of promise and hope.”

New World Order is Already on its Way:

  • A new playbook is needed as war or conflicts such as in Ukraine will be more frequent. India must take a global leadership role in the new world order. The world is moving very fast towards new world order, new systems following the Covid pandemic. India should not miss this opportunity. Azadi Ka Amrit Mahotsav is the perfect time to think about how India can play a global leadership role in the coming years.
  • In 2030 India’s GDP is expected to be $8.4 trillion and will overtake Japan as Asia’s second-largest economy. The global power balance is increasingly moving from west to east. The old-world order is on its last legs and the role and importance of the G7 have been greatly diminished by the rise of the developing world. The G7 has increasingly become an institution in search of a role.

India can tackle the new world order:

  • The world today is interdependent but also polarised, and will retain both features going forward. To navigate, nations will need greater diplomatic skill and foresight. India has proven reserves of both.
  • Azadi ka Amrit Mahotsav has presented an opportunity to inspire the country. "India's voice should be bold at the main table. India should not sell itself short and believe that it can take up a leadership role.

Will India’s Development Enable it to Reclaim its Proper Role in Global Affairs?

  • The end of the cold war has resulted in a fundamental reorganisation of international relations. The cessation of ideological struggle places an objective opportunity for the development of a better security environment. However, as the new global equilibrium takes hold there is a tremendous degree of uncertainty and fluidity all around.
  • India owing to its size, resource potential and strategic location is widely considered as a regional powerhouse that is ready to emerge as a power in the new world order.
  • India is a huge multi-ethnic community that has effectively managed the problems posed by regional, linguistic and religious diversity without jeopardizing its national unity despite occasional distortions the amazing durability of its democratic functioning in a secular federal framework has continued to defy the scepticism of its harshest critics.
  • Huge potential in the Indian Market: With its rising middle class, vast unexplored markets for commerce and industry and large-scale foreign investment India has risen to prominence as a worldwide economic force.
  • Increased Defence Capabilities: India has also developed a formidable defence capability. It boasts the world’s fourth-largest military force and a spotless professional record. It possesses a credible and self-sufficient defence apparatus that has been meticulously constructed over the last three decades. India’s missile development program has also accelerated demonstrating the country’s technological might.
  • Resistance from Neighbourhood: In terms of political stability, economic progress and military might India’s position and power projection are largely dependent on its national security. Although India’s centrality is ensured by the asymmetrical power structure in South Asia. Its regional strength and influence are constrained by neighbouring nations' ongoing pressure to resist its dominance. Pakistan's never-ending quest for parity with India in particular has created a fundamental strategic dissonance in the area limiting Pakistan’s ability to control or influence events in its neighbourhood.
  • National Security: With the end of the cold war, the inextricable relationship between regional conflict and great power competition has eroded. However, the various nations' capacity to develop a credible bilateral and regional framework for cooperation will continue to play a key role in supporting the pattern of external participation in the region which is largely driven by their own strategic objective. This will undoubtedly have a short and long-term impact on Indian security prospects. In terms of both foreign threats and internal challenges to Indian territorial integrity and national unity, the country’s national security must include both military and non-military components. Foreign aggression and internal unrest are both threats to the security of a nation but the internal elements can degrade national security more severely than any external threat. Political stability, societal cohesiveness, and economic development would thus be vital to India's security in the future.
  • If the past century was known as the "American Century," this one is known as the "Asian Century," with India as one of the major actors. The preceding period was formed by the post-World War II victor's hierarchy, with the United States and the Soviet Union as rival superpowers and the weaker powers of the United Kingdom, France, and China as adjuncts.
  • China and India have leapt ahead in the strength of their expanding markets and rising populations while the United States focused its energy on war. Other power blocks are forming at the same time with newfound oil money Russia discovered itself and its ruthless invasion of Georgia in 2007 showed that it's ready to impose itself once more on the European and global scene. The European Union is establishing itself as a new power centre but it will always be primarily an economic institution rather than a geopolitical one.
Brazil, South Africa, Germany and Japan are emerging as economic and military powers but the sphere of influence is limited to their local surroundings and they are unlikely to wield any substantial leverage.
  • The collapse of the democratic government in Afghanistan resulted in a fall in US prestige. They will almost certainly be drawn into Yemen and Sudan after that but it will continue to strive to retain its waning influence in the Indo-pacific area where India and China also play a role.

How India can Play a Role in Shaping a New Global Order?

  • India must sustain and strengthen its own trajectory of rapid economic growth and show the world that it is capable of realizing its developmental goals within the rubric of liberal democracy because no argument can be more powerful and alluring than the economic success of India.
  • Going by the World Bank paper, India could pull the last 10% of its population out of extreme poverty well within a decade. The IMF study finds consumption inequality in 2020-21 shrank to its lowest level in 40 years because of government intervention that doubled free grain rations to 800 million people during the Covid-19 pandemic. India is no longer the country with the most extreme poverty.
  • India can emerge as a bridge between many extremes of the world. It's worth noting that India is at the crossroads of two of the world’s most dynamic regions, Eurasia and the nonpacific.
The vast majority of development funding will come from and be invested in these areas. India must ensure that this is not a new way to maximise political interference but rather an opportunity to offer unrestricted opportunities.
  • For far too long international leadership was regarded as a free pass to monopolize the global commons. India has always been an outlier in this regard. India has an interest in peace and a tradition of friendliness to all whether it is on free trade, climate change or international security.
  • India's non-interventionalist and multilateral approaches are well suited to support and sustain global governance in a multipolar world.

Can India Take the Lead in Calming and Assuring the World?

India is capable of doing so because it contains the three attributes required.

  1. India has over centuries of social and national life experience.
  2. India has a spirituality based comprehensive and integrated vision of existence as well as a lived experience of that view of modern technological advancements that have brought the world closer together. So, if mankind with its ethnic-religious and linguistic variety is to live together in harmony conserving and enjoying differences it must look at India for inspiration.
  3. For thousands of years, the people of India have travelled to various nations for commerce but they did not seek to establish colonies in these distant areas to exploit the people living there nor did they try to enslave or convert them. Instead, they taught culture and a more civilized way of life via their own living examples.

 This demonstrates that India possesses the vision ability and necessary to create a new global order.

CONCLUSION:

  • The reshaping and realignment of the world order will be a unique opportunity for India to reassess its foreign policy, economic policy and geopolitical strategy and strengthen its claim for global leadership. Strengthening India’s global economic might through a cautious geo-economic strategy in the aftermath of the Russia-Ukraine conflict can potentially mark a pivotal turn in India’s economic history. India can be the fulcrum of this new global order, as a peaceful democracy with economic prosperity. But this requires India to first stem the raging communal divisions within. It is important that India can emerge as the harbinger of peace, harmony and prosperity in this new world.
  • If the last century was the famously proclaimed, “American Century” – this one is the “Asian Century” with India as one of its main players. The previous era was shaped after the hierarchy of victors of the Second World War with the USA and the Soviet Union as competing superpowers and the lesser powers of the UK, France and China as adjuncts. The ideological conflict of communism versus democracy shaped the contours of the new order, the open rivalry between the two superpowers manifesting itself in wars through their proxies in Korea, Vietnam, Cuba, Algeria and finally Afghanistan. India should take lead in bringing about a new world order to propagate a truly democratic process and a system of peaceful coexistence.
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