Modi govt@2: Engaging with the world, from Pak to China

  • Jayanth Jacob, Hindustan Times, New Delhi
  • Updated: May 26, 2016 13:12 IST
Modi’s foreign policy has been as much about undoing the damage of Manmohan Singh’s last years as it has been about pushing his own world view. (HT File Photo)

After two years in office, Narendra Modi has found a comfort zone with the world -- and the feeling is mutual. His policy priorities have become evident. But converting the small mountain of summitry legacy and diplomatic engagements into tangibles will be his next challenge.

His greatest accomplishment, and arguably the number one foreign policy goal in his first year, has been to restore foreign investor confidence in the Indian economy.

Foreign capital flows had fallen to $12 billion by the last year of the Manmohan Singh-led United Progressive Alliance (UPA) government. Today, they are above $70 billion. In terms of greenfield Foreign Direct Investment (FDI), India overtook China. This has been a result of some reasonable success on the reform front, some terrible policies in other emerging economies and having Raghuram Rajan as a central banker.

Prime Minister Modi’s most ambitious goal has been to change India’s relationship with its smaller neighbours. He successfully kicked this off by visiting Bhutan. Bangladesh has been the penthouse of this policy thanks to the land border agreement. Nepal has been the flooded basement.

The lesser-known success has been his resuscitation of the country’s dormant Indian Ocean strategy.

The medium-term litmus test will be the building of infrastructure links from eastern India to Myanmar through Bangladesh. The short-term will be extricating Sri Lanka from its Chinese debt trap and visiting the missing link, the Maldives.

Modi has had a modicum of success when it comes to grand strategy with the two superpowers. He put the visa ban behind him and has developed something close to a working relationship with the United States, despite an isolationist Barack Obama and deep differences between New Delhi and Washington. Modi also feels he has the measure of Chinese President Xi Jinping. He has taken some risks -- putting off key defence purchases and shying away from issuing visas to Chinese Uighur dissidents.

Pakistan is the perennial problem. Modi surprised most by developing a liking for his Pakistani counterpart Nawaz Sharif. But it is not clear he understands that the Pakistan military, which really runs the show there, has no interest in dialogue.

The Pathankot attack was a pinprick reminder of how resistant Pakistan is to Modi’s tested instruments of statecraft: showmanship and economics. The past two years have not really been about a Pakistan policy as much as an educational course for the Prime Minister.

Modi’s foreign policy has been as much about undoing the damage of Manmohan Singh’s last years as it has been about pushing his own world view.

He has carefully tied foreign policy closely to his economic projects, though his trade policy has been running interference. The Prime Minister recognises that he has to come through on his promises to other world leaders to maintain credibility.

Now that he has raised expectations, he has about two years to go from being a visionary to a statesman, from joint statements to poured concrete.

Full coverage: Modi govt@2

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