Reflections on Indian First Year in Office - A Foreign Policy Analysis Prime Minister Narendra Modi's
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STUDIES
Reflections on Indian
Prime Minister Narendra Modi’s
First Year in Office
A Foreign Policy Analysis
Anna Juhos
T-2015/9
Institute for Foreign Affairs and TradeKKI Studies
Series of the Institute for Foreign Affairs and Trade
Publisher:
Institute for Foreign Affairs and Trade
Reviewer:
László Vasa
Editing and typesetting:
Andrea Tevelyné Kulcsár
Editorial office:
H-1016 Budapest, Bérc utca 13-15.
Tel.: + 36 1 279-5700
Fax: + 36 1 279-5701
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© Anna Juhos, 2015
© Institute for Foreign Affairs and Trade, 2015
ISSN 2064-9460T-2015/9
Introduction 1
A
ccording to Peter Roland Desouza, „from getting the UN to declare International
Yoga Day on 21 June to having the US President as Chief Guest for Republic
Day to establishing a BRICS development bank to land swaps with Bangladesh
(…) Modi has been the most effective”2 in the realm of foreign policy. While similar
remarks have been made by many, such as Sanjaya Baru3 or Ravi Shankar Prasad,4
overall assessment of Prime Minister Narendra Modi’s first year shows rather mixed
results both in terms of India’s bilateral and multilateral relations.
On the one hand, there has been growing emphasis on promoting India’s
soft power, also reflected in Modi’s remarkable outreach to the Indian diaspora
communities worldwide, enhancing people-to-people contacts, especially during
his US trip in September 2014. On the other hand, achievements over the past year
have to be evaluated in the light of China’s and Russia’s growing ‘Eurasianism’, thus,
the potential for slowly shifting power balances reflected in the results of the recent
BRICS5 and Shanghai Cooperation Organisation (SCO) Summits as well. Therefore,
while the efforts of the Modi government cannot be underrated, based on the two
Ufa Summits’ results, I argue that compared to India’s significant regional initiatives,
such as the ‘Act East’ and the ‘neighbours first’ policies, China and Russia acted
more decisively on the northwestern front – with the potential of causing significant
setback for India in the long run.
Given the above considerations, a conclusion of talks about the free trade
agreement (FTA) between India and the Eurasian Economic Union (EEU), additionally,
more nuanced and comprehensive cooperation and development strategies are
required from the Indian side both in the immediate and extended neighbourhood.
1 Anna Juhos is a Fellow at the Institute for Foreign Affairs and Trade, and since August 2014,
she has been working as an Advisor to the Deputy Minister at the Ministry of Foreign Affairs
and Trade, Hungary. The views expressed are the author’s own.
2 Desouza, 2015.
3 „The Prime Minister shines on foreign policy.” Baru, 2015.
4 „The growing role of India as an emerging global power is being recognised.” Prasad, 2015.
5 Consisting of the Federative Republic of Brazil, the Russian Federation, the Republic of India,
the People’s Republic of China, and the Republic of South Africa, BRICS accounts for 45 per
cent of the world’s population, 17 per cent of global trade, and approximately 30 per cent of the
world’s Gross Domestic Product (GDP) PPP. UFA Russia 2015. BRICS/SCO Summits, 2015 a.
Reflections on ... Narendra Modi’s First Year in Office 3STUDIES
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Bilateral Relations
12 Months, 18 Countries
I
n his assessment of Prime Minister Modi’s first year, Sanjaya Baru argued as
follows:
Nobel Prize economist Thomas C. Schelling famously observed (…) that
international relations is all about three things: war and the avoidance of conflict;
migration and the management of the movement of people; and trade, in its many
dimensions. This way of viewing international relations and foreign policy enables
one to quantify the importance of bilateral relations. If the three dimensions to
foreign policy are government-to-government (G2G), people-to-people (P2P) and
business-to-business (B2B) relations, then it is possible to track relations between
nations based on an analysis of how they fare along these three tracks.6
Regarding government-to-government (G2G) and business-to-business (B2B)
relations, Prime Minister Narendra Modi’s visit to 18 countries in 12 months7
undisputedly yielded several results. In the immediate and extended neighbourhood
these include among others the relation with Japan upgraded to ‘Special
Strategic Global Partnership’ with strengthened defence cooperation,8 a Land
Border Agreement with Bangladesh,9 and agreements on visa, customs, or youth
development with Sri Lanka.10
Further afield the Rafale deal with France11 or the long-term uranium supply
agreement with Canada12 should be highlighted. Considering India’s rise in the
international political and economic realm and in line with Venugopal Nandlal
Dhoot’s argument that „stronger relationships with global powers such as China,
the US and Russia will take India to new heights”,13 the Joint Strategic Vision for the
Asia–Pacific and the Indian Ocean Region14 following President Barack Obama’s
visit on Republic Day, e-visas to Chinese tourists, or a joint statement on climate
change during PM Modi’s trip to China in May signal significant milestones in
bilateral relations.15
6 Baru, 2015.
7 Cherian, 2015.
8 Rediff News, 2015; The Economic Times, 2015.
9 Raghavan, 2015.
10 Rediff News, 2015.
11 As a result of his visit to France between 9–12 April 2015, the agreement was reached that India
will buy 36 Rafale fighter jets and move ahead with the stalled Jaitapur project in Maharashtra.
A railway protocol was also signed to develop a semi high-speed railway corridor in India. The
Indian Express, 2015.
12 Ibid.
13 Dhoot, 2015.
14 The White House, Office of the Press Secretary, 2015; The Hindu, 2015.
15 Desouza, 2015.
4 Anna JuhosT-2015/9
However, besides the numerous Memoranda of Understanding (MoUs) and other
agreements, it has been soft power and the promotion of India abroad, which should
be regarded as important assets of Modi’s foreign visits, reviving ties with the Indian
diaspora communities. As Shiv Visvanathan argued, „the diaspora validated Modi’s
dream of a new middle-class India, which wanted to feel at home in India and secure
and powerful in the world.”16 This is, beyond question, one of the most important
aspects for India on its path to a greater status in the international community on
the one hand, and also for the Bharatiya Janata Party (BJP) to cement its legitimacy
and support base both domestically and internationally. Besides these, however,
the diaspora groups’ major role lies in their remittances, a significant contribution
to India’s economy. More precisely, „with remittance flows of around $70.4 billion in
2014, India remains the world’s largest remittance recipient country”,17 leaving the
necessity to foster ties with diaspora groups beyond question. However, while PM
Modi has been very successful in reaching out to the Indian diaspora communities,
his efforts have also resulted in more critical observations, such as those of Dilip
Cherian, who argued that „from Madison Garden to Shanghai he’s the darling of
Modi-chanting Global Indians, who are expected to be the shining ambassadors of
the less-lucky ones back home”.18
For analysts viewing Modi’s first year rather as a disappointment, achievements
seem meagre when compared to the United Progressive Alliance (UPA) government’s
first year in office.19 Some, such as Kapil Sibal and Srinath Raghavan have come
down relatively harsh in their overall evaluation of the „flaws in the institutional set-
up on foreign policy and security”,20 criticising Mr Modi for a soft hand on neighbours
by arguing that his „policy on Pakistan has been a failure”, and „despite repeated
Chinese incursions across the border (…) Mr Modi himself happily visited China”.21
Moreover, when it comes to Dhoot’s argument about the elevating effect of strong
relations with Russia, China, and the United States, the argument goes as follows.
Considering the lack of formal talks on the sidelines of the United Nations General
Assembly or the SAARC meeting, the US’s proposal for a six-fold increase in military
aid together with Russia’s offer for military exercises and China’s infrastructure
development in Pakistan,22 the much-awaited opportunity for new impetus with
these global powers has not only faded, but already failed.
Following up on the above considerations together with the nature of the visits
and the agreements signed, by putting these bilateral relations into the matrix of
G2G, B2B, and P2P relations, I argue that a partial assessment of Prime Minister
Modi’s first year can be outlined as follows.
16 Visvanathan, 2015.
17 The World Bank, 2015. p. 22.
18 Some of these diaspora members’ support to right-wing organisations and ideologies have
also raised several questions and reservations about the ruling coalition’s intentions with
regard to domestic politics. Cherian, 2015.
19 Raghavan, 2015; Mehta, 2015.
20 Raghavan, 2015.
21 Sibal, 2015.
22 Haidar, 2015 a.
Reflections on ... Narendra Modi’s First Year in Office 5STUDIES TANULMÁNYOK Historical visits23 and agreements on strategic issues, such as security cooperation or the opening of new official representations were considered as enhancing G2G relations, while MoUs on tourism, youth, and culture were included under the P2P, and trade-related agreements under the B2B framework.24 As the 23 Under historic state visits I included Sri Lanka, where Modi was the first PM visiting the country since Rajiv Gandhi in 1987; Australia, since Modi was the first Indian PM in 28 years to visit; and the US considering the previous visa denial for Modi. 24 Categorisation was based on the following data: Bhutan (16–17 June 2014) – doubling of scholarships to Bhutanese students; PM Modi laid the foundation stone of the Kholongchu Hydro-electric project, a joint venture between India and Bhutan; Nepal (3–4 August; 25–27 November 2014 SAARC Summit) – $1 billion credit line for hydropower, irrigation, infrastructure development; MoUs: on national police academy; promoting tourism; youth affairs; P2P contacts; sister cities; Australia (16–18 November) – Australia–India CEO forum reconstituted; framework for security cooperation; agreements on extradition and social security; MoUs on combating drug trafficking, enhancing tourism, and cultural links; Seychelles (10–11 March 2015) – agreement on the infrastructure development of Assumption Island; Fiji – 75 million Rupees credit line for Fiji; expand defence and security cooperation; Mauritius (11–13 March 2015) – agreement on building strategic assets in Agalega; Singapore (29 March 2015) – Lee Kuan Yew – state funeral. Germany (12–14 April 2015) – Modi inaugurated the Hannover Messe, a business fair; China (14–16 May 2015) – e-visas for Chinese tourists; Memoranda of Understanding (MoUs) 6 Anna Juhos
T-2015/9
above categorisation shows, based on the results of the bilateral visits, there are
only a handful of countries, with which the last year can be regarded as effective
on all three accounts. Translating Schelling’s B2B, P2P, and G2G model for the
period of May 2014 to May 2015 into the envisioned ‘3 C Mantra – Commerce,
Culture and Connectivity’25 of the Indian government, it can be argued that India’s
relations with the United States, China, Australia, and Sri Lanka have yielded the
most comprehensive results affecting all three dimensions. Furthermore, India’s
relations with Bhutan, Nepal, South Korea, Mongolia, and Japan – although to a
varying extent – can also be considered effective on two dimensions, resulting in
several trade- and P2P contact-enhancing agreements. This leaves visits to nine
countries out of the eighteen rather successful and effective.
Overall, the Modi government’s efforts in the first year resulted in several
agreements and the revitalisation of bilateral ties with the above-mentioned
countries. However, a foreign policy evaluation based exclusively on these could
lead to a partial assessment only. Therefore, for a more nuanced understanding and
overview of India’s foreign policy of the last year, multilateral relations and India’s
role in regional organisations and global platforms have to be examined as well.
For this purpose, achievements at multilateral fora, especially the latest BRICS and
Shanghai Cooperation Organisation Summits will be analysed.
Multilateral Relations
P
rime Minister Modi’s first year in office has not only included countless
bilateral visits, but a number of multilateral meetings as well. These include
among others the Fortaleza BRICS Summit in July 2014, the SAARC Summit
in Kathmandu in November 2014, or the BRICS and SCO Summits in Ufa in July
2015. Out of these, the SAARC and the SCO Summits are of remarkable importance
for India’s ‘neighbours first’ and ‘Act East’ policies, launched – or revitalised – since
Modi’s inauguration.
While I argue that the latest SAARC Summit provided new areas for cooperation
and a potentially more assertive role for India as a regional hub with the signing of
worth $22 billion in the fields of engineering, outer space, earthquake science, railways, mining;
and establishment of consulates in Chengdu and Chennai;
Mongolia (16–17 May 2015) – 14 agreements on cooperation in border defence, policing, and
surveillance, air services, cyber security, new and renewable energy; $1 billion credit line;
South Korea (18–19 May 2015) – seven bilateral agreements – avoidance of double taxation;
formalising consultations between National Security Councils; $10 billion investment for
infrastructure projects.
The Economic Times, 2015 b; The Indian Express, 2015; The Times of India, 2014 a; The Person.
The PM, 2014 a; Rajeev, 2015; The Economic Times, 2014; The Person. The PM, 2014 b; The
Wall Street Journal, 2014.
25 The Economic Times, 2015 a.
Reflections on ... Narendra Modi’s First Year in Office 7STUDIES
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the Framework Agreement on Energy Cooperation (Electricity),26 China’s multifocal
strategy seems to be moving ahead at a much faster pace in India’s extended
neighbourhood. As a result, while the Modi government is undeniably successful
in luring Foreign Direct Investment (FDI) from the diaspora communities and
investing in soft power abroad, Chinese diplomacy seems to be faster in terms of
economic integration. As a result, while India focuses on its ‘Act East’ policy, China
can potentially outmanoeuvre it in what figures as India’s ‘Look North’ and ‘Connect
Central Asia’27 policy.
‘Act East’ – React on the Northwest?
I
ndia’s outreach to Southeast Asia has started already in 1991 with the ‘Look
East’ policy, followed by a full dialogue partnership with the Association for
Southeast Asian Nations (ASEAN) in 1995, and the conclusion of the India–
ASEAN Free Trade Agreement on trade in goods in 2010 with Malaysia, Thailand
and Singapore.28 Elevating India’s ‘Look East’ policy to ‘Act East’29 at the ASEAN
Summit in Myanmar, November 2014 signalled a new determination to speed up
and deepen engagements with India’s fourth largest trading partner. Launched in
1991, the much-awaited action materialised in the agreement on investment and
the agreement on trade and services on 12 and 13 November 2014 respectively,
with the aim of increasing trade from $76 billion in 2013 to $100 billion by 2015, and
$200 billion by 2022.30
In order to put these goals into perspective, a comparative ASEAN–China–India
overview of trade relations reveals interesting facts. First of all, it is important to
highlight that while the Trade Intensity Index with ASEAN stands around 0.09–0.10
for both India and China, the volume of total trade between China and the ASEAN
countries is significantly higher (approximately $328,661 million) than India’s, which
was $68.431 million in 2014.
26 For further reference on India’s relations with SAARC and suggestions for development of ties
with countries in India’s immediate and extended neighbourhood, see: Juhos, 2015. Since a
comprehensive overview is given in this analysis about the utility of SAARC, further evaluation
of this summit has not been included here.
27 Jha, 2015.
28 Nag, Sikdar, 2011. p. 4.
29 The Economic Times, 2015 a; Parameswaran, 2014; Rajendram, 2014; Rediff News, 2015.
30 The Hindu, 2014; ASEAN, 2014 c; ASEAN, 2014 b; ASEAN, 2014 a; India Gazette, 2015.
8 Anna JuhosT-2015/9
Table 1
Total Trade Growth between ASEAN Countries, India,
and the People’s Republic of China31
Total Trade Growth
India People’s Republic of China
(%)
2013 2014 2013 2014
ASEAN -2.92 -0.29 10.19 6.93
Brunei Darussalam -2.49 27.70 14.77 7.29
Cambodia -10.23 82.61 40.02 23.11
Indonesia 1.15 -4.67 2.75 -8.05
Lao PDR -4.11 -18.20 61.97 28.82
Malaysia 0.42 3.40 10.09 -1.43
Myanmar 9.65 12.10 43.30 130.06
The Philippines -0.05 26.12 14.31 21.17
Singapore -14.58 -4.85 10.76 3.93
Thailand -2.97 0.04 0.58 -1.63
Vietnam 32.80 6.81 21.95 17.05
However, in 2014, out of the ten ASEAN countries, six – namely Thailand,
Malaysia, Indonesia, Brunei Darussalam, Cambodia, and the Philippines – have
recorded relatively better total trade growth with India than with China. Additionally,
in that year, the latter three together with the Lao People’s Democratic Republic
(PDR) had higher import growth with India than with China. Regarding the Trade
Intensity Index, according to data from 2014, India fares better than China in its
relations to Brunei Darussalam and Indonesia.32
Notwithstanding the significant fluctuations over the past ten years in
trade relations between China, India, and the ASEAN countries, building on the
complementary markets of these economies, the recently signed agreements can
significantly facilitate improvement of relations between India and the Southeast
Asian countries. This can make the $100 billion goal at the end of 2015 more
realistic,33 even though still far behind China’s overall trade volume.
31 Data in the tables are based on: ADB Asia Regional Integration Centre, 2015.
32 Ibid.
Higher import growth from India to Brunei Darussalam (15.27 compared to China’s 2.59 in
2014), even higher trade intensity index (2.83 compared to China’s 1.18 in 2014);
Higher import growth from India to Cambodia (81.04 to 20.03 in the case of China in 2014);
Higher trade intensity index with Indonesia for 2014 (2.36 compared to 1.26 with China).
There is an interesting trend with regard to the Lao PDR’s import growth. Although it has
declined between 2013 and 2014, in 2014 it stood at 39.41 in the case of India, while significantly
decreased from 84.17 to 7.39 for the same period in its relation with China.
The Philippines import growth has been stagnating with China (20.56, 20.66) between 2013
and 2014, but with India its import growth has significantly increased from 5.12 to 34.35 per
cent.
33 The Times of India, 2014 b.
Reflections on ... Narendra Modi’s First Year in Office 9STUDIES
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Thus, efforts towards the East are well articulated and there is considerable
improvement. However, Indian policymakers have to make sure to maintain a
multifocal foreign policy strategy, and that their focus is not diverted exclusively
towards the East, but relations are nurtured on the northwestern front as well. At
the moment, due to India’s ‘neighbours first’ and ‘Act East’ policies, relations in the
immediate neighbourhood show improvement. However, initiatives in the framework
of India’s ‘Look North’ and ‘Connect Central Asia’ policy rather seem to work as a
follow-up reaction to the Sino–Russian ‘New Great Game’34 in the region. On the
one hand, Modi’s recent Central Asia tour resulted in several MoUs with reiterated
intentions to strengthen ties in the energy and the infrastructure sector. These
include among others agreements ranging from annual joint military exercises with
Kyrgyzstan35 to the Kazakh uranium purchase deal.36 On the other hand, the extent
to which Russia and China have already acquired a relatively stronger position is
reflected in the results of the 2015 Ufa Summits.
Ufa 2015
Can Growing ‘Eurasianism’ Overshadow 37
India’s Aspirations?
I
n 2016, providing a new opportunity to enhance India’s role in the international
arena, besides the accession38 – and also that of Pakistan39 – as a full member to
the Shanghai Cooperation Organisation (SCO),40 the country will host the eighth
BRICS Summit as well. While due account must be given to these achievements and
opportunities, I argue that the current SCO and BRICS Summits in Ufa significantly
favour Russian and Chinese interest.41 Therefore, to keep the pace, India must
embark on a clearer development strategy with the following considerations.
34 Cossa, Marantidou, 2014; The National Interest, 2014.
35 DNA, 2015.
36 NDTV, 2015.
37 Mankoff, 2009; Laruelle, 2008.
38 UFA Russia 2015. BRICS/SCO Summits, 2015 b.
39 Pakistan and India will become full members of the SCO at the Tashkent Summit next year. The
BRICS Post, 2015 a.
40 The Shanghai Cooperation Organisation; Official Website of Russia’s Presidency in the
Shanghai Cooperation Organisation, 2014–2015.
41 The lost ‘race’ from the Indian side against China at last year’s BRICS Fortaleza Summit for the
BRICS Development Bank headquarter could also be considered as a sign showing into this
direction.
10 Anna JuhosT-2015/9
Whose Summit?
BRICS
T
he Seventh BRICS Summit (in Ufa, Russia) – “BRICS Partnership – A Power-
ful Factor of Global Development”42 –, held on 9–10 July 2015, marked
another milestone in the history of the cooperation platform. Besides the
Ufa Declaration and important institutional set-up launches, such as the New
Development Bank (NDB), the Contingent Reserves Arrangement (CRA),43 or annual
BRICS Export Credit Agencies (ECA) meetings,44 these emerging market economies
reiterated their commitment to a more equitable international order when it comes
to trade, politics, security, and global challenges. In this regard their main focus
is on “discarding the resort to ‘double standards’”45 and strengthening the role
of emerging markets and developing countries (EMDCs). Aspirations include the
expansion of the use of “national currencies in transaction between the BRICS
countries”, and greater role in the United Nations, in the Security Council, or in the
International Monetary Fund.
However, in spite of the BRICS members’ unequivocal support for the above
goals, it is questionable to what extent BRICS itself will stick to an equitable order
among its members, or will eventually be turned into CRIBS, or a “Silk World Order
of trade and integration”, as suggested by Mahdi Darius Nazemroaya.46 With Russia
and China, spearheading new connections between the Eurasian Economic Union
(EEU)47 and the “One Belt, One Road”48 initiative, a massive economic corridor-
project can be established.49 This, on the other hand, can have the potential to
42 BRICS Information Centre, 2015. p. 1.
43 Ibid. Section 15–16, p. 7.
44 Ibid. Section 13, p. 6.
45 Ibid. p. 3.
46 Nazemroaya, 2015.
47 Eurasian Economic Union, 2015.
48 With the membership of Russia, Armenia, Kazakhstan, and Belarus, the EEU accounts for 3 per
cent of the world’s trade turnover, and for 3.2 per cent of the world GDP with 2.2 trillion USD. In
January 2015, the population of the Union reached 182.1 million people, which equals 2.5 per
cent of the world population. Out of this, 92.9 million people were categorised as economically
active, which means that the EEU comprises 2.8 per cent of the world’s economically active
people.
„The ‘Road’ will traverse China, Mongolia, Russia, Belarus, Poland, and Germany, extending
more than 8,000 miles, creating an economic zone that extends over one third the circumference
of the earth. (…) An equally essential part of the plan is a sea-based ‘Maritime Silk Road’ (MSR)
component, as ambitious as its land-based project, linking China with the Persian Gulf and the
Mediterranean Sea through Central Asia and the Indian Ocean.” Berke, 2015.
49 This could have been anticipated after the signing of a decree in May between President Putin
and Hszi Csin-ping to enhance and tie development of the EEU and the Silk Road project.
Reflections on ... Narendra Modi’s First Year in Office 11STUDIES
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significantly outweigh, and even isolate other regional groupings, such as the India-
dominated SAARC later on.
Preventing Indo-Russia bilateral trade from further decrease with the potential
help of the Indian diaspora,50 additionally, signing a joint statement at the
15th St. Petersburg International Economic Forum in June 2015,51 and starting
negotiations for a Free Trade Agreement (FTA) between India and the EEU are
undeniably – much needed – steps into the right direction.
Shanghai Cooperation Organisation (SCO)
E
xpectations must have fallen short for India at the Shanghai Cooperation
Organisation Summit as well. Although leaders on both the Indian and
Pakistani side can boast of launching the accession process, attaining full
membership at the next summit in 2016 in Uzbekistan, developments here also
favour Russia and China. This is also reflected in granting Belarus an observer status
and including Azerbaijan, Armenia, Cambodia, and Nepal as dialogue partners,52
most of which have traditionally stronger relations with Russia and/or China. SCO
leaders’ readiness to support “a Silk Road economic belt across the SCO member-
states”53 is another quite explicit indication for a growing disequilibrium for India’s
disadvantage in the region. Moreover, China’s proposed help to Afghanistan54 might
also come as a setback, considering Afghan President Mohammad Ashraf Ghani’s
tilt towards Pakistan.55
Furthermore, Prime Minister Modi’s visits to Central Asia – although important
initiatives – do not seem to significantly balance the approximately $16 billion, which
will be spent on projects in Central Asia out of the $40 billion Silk Road Fund.56
The BRICS Post, 2015 a. Furthermore, Sino-Russian cooperation is also underpinned by the
$400 billion energy deal in yuan and rubles between Gazprom and China National Petroleum
Corporation. Ismi, 2014.
50 Haidar, 2015 b.
51 Embassy of India, Moscow, 2015; RT, 2015.
52 Most recently, the case of Belarus provides the clearest example of a well-conceived and far-
reaching project. In Belarus, the Chinese plan to build the first „modern city of the Eurasian
continent” and create the largest manufacturing and industrial park in Europe, connecting Ber-
lin, Warsaw, Minsk, and Moscow. Nazemroaya, 2015; TASS, 2015.
53 Radio Free Europe/Radio Liberty, 2015.
54 Ibid.
55 Kaura, 2015; Raghavan, 2015.
56 The BRICS Post, 2015 a.
12 Anna JuhosT-2015/9
Table 2
Trade Intensity Index, 201457
Trade Intensity Index, 2014 India China Russia
Kazakhstan 0.55 2.04 10.42
Kyrgyzstan 0.18 4.61 8.24
Tajikistan 0.55 3.95 7.60
Uzbekistan 0.56 1.99 10.05
Turkmenistan 0.29 4.05 2.97
If we look again at the Trade Intensity Index for these countries’ relations,
Russia’s and China’s advantage becomes obvious. Besides, joint project proposals,
such as the Trans-Siberian Railway, or the Baikal–Amur Railway58 must be also
worrying for India.
Overall, considering the above reflections regarding India’s performance at
multilateral fora, it has to be highlighted that successful and comprehensive foreign
policy action on the East cannot come as a detriment and further loss of relations
on the Northwest. Therefore, I argue that the latest SAARC Summit in Kathmandu,
the ‘neighbours first’ and the ‘Act East’ policy contributed to the improvement
of relations in South and Southeast Asia. However, in order to forestall growing
‘Eurasianism’ potentially overshadowing India’s aspirations, relations need to be
further cemented on the northwest as well, showing the need for a comprehensive
and elaborate Indian foreign policy strategy.
Conclusion/Recommendations
O
verall, this analysis aimed at providing an evaluation of Prime Minister
Narendra Modi’s particular foreign policy initiatives upon completing his
first year in office. From the assessment and categorisation of bilateral ties
to India’s performance at multilateral fora, it shed some light on India’s ‘Act East’
policy compared to Russia’s EEU and China’s New Silk Road project. Regarding
bilateral ties, one of the main assets of Modi’s visits has been the marketing of India,
and strengthened ties with the diaspora communities. The agreements concluded
can definitely provide a new impetus in the bilateral relations, reinforcing a positive
assessment of Modi’s foreign visits.
However, what the growing integration of the EEU and the New Silk Road project
might leave behind can be quite worrying for India. Therefore, to compete with the
Sino-Russian projects, India has to use its connections with allies in the extended
57 Data based on: ADB Asia Regional Integration Center, 2015.
58 The BRICS Post, 2015 a.
Reflections on ... Narendra Modi’s First Year in Office 13STUDIES
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neighbourhood and embark on a much clearer and more comprehensive strategy.
This should include boosting business ties more extensively and investing into
not only soft power but railway connections, power-generating and road-building
projects as well.
While forecasts for India seem promising and many of the first year’s initiatives
can only yield significant results in the long run, Mr Modi can further utilise several
opportunities and assets to live up to the expectations. Among these are the
projected 7.5 per cent growth in the next fiscal year,59 which is expected to surpass
the growth rate of China, together with the government’s connections to the Indian
diaspora communities. They seem to guard vital interest and remain significant
contributors to India’s economy. For a more elaborate and active ‘Connect Central
Asia’ strategy, a conclusion of a balanced FTA with the EEU could be a significant
step forward, and needs the thorough attention of the Indian government. For the
above-mentioned goals, the G20 meeting in Turkey in November60 can also provide
new opportunities for Prime Minister Modi to increase India’s more assertive role
on the stage of world politics – and last but not least, to strengthen the support for
his party at home.
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