PM Modi’s Foreign Policy


The completion of Prime Minister Narendra Modi’s visit to USA means that he has now interacted with the leaders of four of the five countries/regions on his list of foreign policy priorities. These wereoutlined in the President’s address to the opening session of the new Parliament (SAARC, China, Japan, Russia, USA).  It is therefore an appropriate time to take stock.In this note we focus on two questions: One, what are the underlying changes in the directions of India’s Foreign policy. In other words, is PM Modi’s Foreign Policylikely to differ from that of SG-MMS‘s?Two, what were the objectives of PM Modi’s foreign policy actions in first four months, to what extent have they been achieved and what remains to be done?

Directional Change

Every country’s foreign policy has, after a change of government (whether democratic or autocratic), elements of continuity and change.  India under PM Modi is no different. If I were to put a number to it, I would estimate a change factor of 10% at this point, potentially going up to 20% by the end of the five year term.  What are these changes in direction and emphasis? These changes have not necessarily been explicitly articulated by the new government, but in my view, are implicit in their pragmatic actions and “view of the world.”There are four areas in which I see an emerging change in emphasis: The centrality of economic & technological development, the integrations of domestic and foreign policy with respect to this objective, the emphasis on “national power” including “military power” and “Soft power” and a reduction in self-imposed constraints on actions that third counties may construe as inimical to their interests.

The first change in foreign policy isa much greater attention to economic objectives. This is not merely a reiteration of the economic development objective that has been India’s mantra since independence, but a recognition of the role of “technology” (broadly defined) in all aspects of economic development & economic power.   This involves an implicit benchmarking of the technological capabilities of the Indian economy with respect to the global best practices and/or global technology frontier, a perception of large gaps across much of the economy and the goal of bridging these gaps through domestic and foreign economic policy. How this is different from earlier regimes is reflected in two policy initiatives: The “Swach Bharat” campaign which doesn’t involve “high technology” but does reflect a huge gap in sanitation systems and practices between India and the developed countries and will require innovative technological, management, social and public solutions. The second is the “Digital India” campaign, which recognizes the gap between India and digitization frontier, but treats it as an opportunity to solve problems of governance and corruption as well as its innovative use for health education & training needs of a population four times the size of the largest developed country(leap frogging). It is probably the first time that an Indian PM elucidated India’s economic & technological objective abroad(“India First”),  identified  the specific role that each country could play in achieving these objective and made that the center piece of the discussion with that country!

The second change is a much greater integration of domestic and foreign policy.Though the talk about integrating national economic policies and foreign policies started in the 1990s, this has only been episodically reflected in domestic or foreign policy.  The Indian Prime Minister mentioned both the programs (“Swach Bharat”, Digital India/smart cities) in his public statements in the USA &Japan. In his meetings with leaders of countries which are more advanced in terms of any aspect of economy or technology, he has been very explicit about Indian objectives with respect to economic development and technological catch up and in exploring how these countries can help India close these gaps. The message to all inside and outside the government is quite clear: Both domestic and international policy can/must/will be used to close the economic and technological gap with more advanced countries across the entire spectrum from basic sanitation to defense vehicles, aircraft & ships to the frontiers of cyber space & outer space.“India First” means that what India needs/wants from each economic & technology power will be expressed with greater clarity & specificity andthese counties have to respond  with counter demands for what they want in return. India’s decisions will then be based on comparative benefit-cost ratio of dealing with different countries on a defined set of issues. This contrasts with a policy of “non-alignment” where other countries/powers lay out their goals and demands and India responds by weaving  a “non-aligned” path between them.

The thirdchange is a greater emphasis on overall national power, a pyramid consisting of a broad economic base, with a solid  block of military power resting on it, topped by a smaller cone of “soft power”. By now it is widely recognized that economic power forms the foundation of National power (base of a pyramid). However, this government recognizes (much more) explicitly the role of strategic technology and military power as the second major block in the Pyramid of national power. This is vital for deterring aggression, dampening aggressive designs and insuring peace.New developments in war & aggression(cross-border terrorism, use of non-state actors, foreign ideologues-mercenaries) mean that our capabilities in these areas must cover a much wider spectrum.  Though earlier governments were aware of the new forms of aggression being adopted by antagonists, there was a great reluctance to admit that this constituted a new form of war and to boldly and openly defend against this new form of aggression. This is (in my judgment) already in the process of change, both in terms of capabilities in counter-terrorism and offensive-defense against non-state actors, but even more importantly in willingness to take calculated risks in using these covert capabilities. Deterrence is however only effective, if the adversary using these tactics is convinced that the new government will respond to asymmetric warfare with appropriate actions across a much broader menu of conventional & unconventional options.  As the diplomatic signals being sent to Pakistan (e.g. cancellation of Secretary level talks) did not appear to be getting through to the “deep state”, it became necessary to signal the seriousness of the change in overall strategy, through a heightened (conventional) response to border firing/cease fire violations. Similarly unconventional psychological warfare & “creeping annexation” tactics on the northern border are being countered by bold new plans (e.g. the “Macmohan highway in Arunachal) that have both a conventional defensive and a signaling component.

Another relatively neglected element of strategic-defense power that will receive much greater attention is the capability to produce all types of defense equipment in India. “Self-sufficiency” has been a slogan from the days of “Nehruvian Socialism,” yet it has played second fiddle to the goal of preserving an increasing inefficient Public sector monopoly over the means of (defense) production and ideological squeamishness about foreign participation in JVs located in India.  This defense public sector veto over use of private domestic & foreign capabilities for defense production within India is being decisively broken by the new government, to give primacy to goal-achievement over ideology.The ability and willingness to transfer technology and help build skills & research capabilities at minimum cost, will consequently play a much more important role in relations with Japan, Russia, USA and EU countries.The reinvigorated approach to national security is likely to manifest itself in a reversal (over the next five years) of the trend decline in ratio of defense expenditures to GDP (since the BOP crises of 1991).

There will also be a greater emphasis on the third dimension of national power, global socio-politics and “soft power”. This includes the expansion of common ground based on religious and cultural heritage & history of India (e.g. Hinduism viz. Nepal, Buddhism viz. E & SE Asia, Yoga viz. West, and possibly Shia Islam viz Iran), as well as the Indian diaspora across the World. PM Modi’s speech to the Indian diaspora in New York, USA, was a very successful attempt to inspire the diaspora to contribute to the economic & technological development of India, either directly or indirectly through political participation in their country of citizenship.

   The fourth change is a recognition that the aggressive intentions of ideologically driven foes can not be dampened by economic relations and sops; in fact they may have the opposite effect of signaling weakness to be exploited or a superiority to be resented. In other words economic power and economic relations can complement but notsubstitute for strategic-defense power and international security relationships in deterring aggression. Thus India’s economic relationships with potential adversaries (and friends) can be pursued relatively independently from the security relationship, without one constraining the other or being a hostage to it.  This is most clearly apparent from the meetings PM Modi held with President Xi Jinping of China, the economic agreements reached and the formation of the BRICs Bank and AIB (Asian Infrastructure Bank). Further neither the economic nor the security relationship with one country (friend or foe) will be allowed to constrain the economic or security relationship with any other country(e.g. economic & security co-operation withJapan and Vietnam).Both will be evaluated in terms of the primary objectives of closing the economic and technological gap and building national power, in a pragmatic forward looking manner without any ideological blinkers or historical baggage.

Opening Moves

Short Term/Immediate goals of PM Modi’s foreign policy initiatives from the day he took the oath of office seemed to have three (partly) overlapping ones: One goal was to establish his credentials as a National and International leader.  During the general election campaign most political analysts had predicted that Shri Modi a State leader wouldn’t be able to rise above his regional origins and limitations.  Mr. Modi wanted to lay this specter to rest quickly & decisively so he could focus on achieving his development objectives. The second goal was to put India back on the global stage, from which it had fallen off during the last 3-4 years (according to all objective analysts and observers).In this he was backed/supported by advise from virtually all international relations experts inside & outside the government.  In this process he also wanted to convey to the World, the change in foreign-domestic policy emphasis of his government along the lines elucidated above.  The dramatic outreach to SAARC countries, the meetings with leaders of Japan, China and USA, and a flurry of meetings with other countries (eg Australia, UK, France), complemented by a number of foreign trips by the President and the EAM, has achieved both these goals.

The third goal was to re-establish international investorconfidence in Indian economy and polity.  The results of the general election, in which the BJP and its allies won a decisive majority in the Lok Sabha, had already opened the flood gates of capital inflows into India, before Shri Modi was sworn in as Prime Minister.  However, this had not been reflected in a similar increase in gross fixed capital formation(GFCF). It was therefore felt necessary to communicate directly with the large foreign direct investors(FDI). The PMs goal was to gain their trust& understanding of his seriousness in reversing the effects of obstructive policies & procedures that resulted in the collapse in growth of GFCF and removing bottlenecks in investment in infrastructure, manufacturing etc.. The US private sector is the most important source of technology and foreign investment across a broad spectrum of industries. The PM was largely successful in establishing trust. However, given that Foreign direct investment usually follows domestic investment and both were waiting to see action on certain known policy & regulatory problems, full restoration awaits action on the domestic policy & regulatory front. Now that two important State elections are over and the government has re-started the reform process, we will soon be able to judge whether enough has been done to revive GFCF from the second half of 2014-15.

US Reset &Realism

In the Modi government’s foreign policy priorities, as outlined in the President’s speech to the new Parliament put US arithmetically at fifth position in its list (behind SAARC, China, Japan and Russia). However the US is still the sole super power and likely to remain so for at least a decade and stands head and shoulders above others in the depth and breadth of strategic and defense technology. Thus it was particularly important for the PM to reset Indo-US relations to 2009-10, by sweeping out problems created in 2010-13. It was correspondingly important for the US govt to take the Modi led government on board and to understand its changed priorities. The reset of Indo-US relations has been achieved.  There appears to be a deeper understanding on and heightened co-operation in counter-terrorism(safe havens,“financial and tactical support for networks such as Al Qaeda, Lashkar-e Taiba, Jaish-e-Mohammad, the D-Company, and  Haqqanis”). There are also hints of enhanced cooperation inDefense procurement, production and technology development and on Maritime Security in the Indian Ocean and Indo-Pacific Region. The former includes (a) An extension of the Framework forUS-IndiaDefense Relationship(2005) and a Reinvigoration & expansion of Political-MilitaryDialogue. (b)The setting up of Task Force under Defense Trade &Technology Initiative, whose first meeting was in Sept 2014, to decide on specific projects & technologies. Maritime security is to be enhanced through likely technology transfers to the Indian Navy (e.g the magnetic catapult for Indian aircraft carrier) and an expansion of Malabar exercises.

Is it unclear to what extent a genuine strategic partnership between USA and India will develop given the differences in perspective between a rich global power and a poor regional one. The USA, like many rich countries is a net exporter of technology with high per capita but low incremental, pollutionwhile India is a net technology importer with low per capita but high incremental, pollution). These differences need to be recognized and dealt with objectively& fairly. There is also a difference in perspective between the US with a profitable capital-intensive & export competitive Agriculture sector and India with a labor-intensive, low productivity, subsistence agriculture with 66% of population dependent on it.  There seems however to be the beginning of a pragmatic approach to resolving these differences and/or minimizing the negative fallout of unresolved differences. There are also some differences arising from the Global interests of a “Super Power” and the regional focus of India, which is still two decades away from becoming a “Great Power.”However, the reasonably high convergence of interests on maritime security in the Indian Ocean (and Indo-Pacific)and on terrorism,can form the core of a strategic understanding, whilepragmatically allowing for greater differentiation in the respective approaches toindividual countries in West Asia.


        The PM Modi led Indian government is changing the emphasis of India’s Foreign and National security policies. Elements of this change in approach are already visible. These involve a clearer definition of Indian interests (“India First”) in terms of economic and technological development, a greater focus on these goals in foreign policy and a consequent integration of domestic and foreign policies. Other changes involve a greater focus on development of national power, in particular an enhancement of the somewhat neglected element of military power, its broader definition to include asymmetric warfare of which State financed-directed non-state actors are a dangerous part, and a jettisoning of self-imposed constraints of ideology and misplaced fear of offending other countries who display no such squeamishness in their behavior.[i]   Overall a much more confident, credible and effective national security-foreign policy is predicted to emerge over the next five years.

A shorter version of this article appeared  on the Op Ed page of The Hindu, on 1st November, 2014under the banner, “Recalibrating India’s Foreign Policy “, .

[i] One must, however warn against the unfortunate tendency of some prominent Indians toward bombast & hyperbole. Those who accuse PM Nehru of publicly making tall claims and assertive statements viz China, after denuding & hollowing out the armed forces through neglect & resource starvation, should be very careful about chest thumping based on hypothetical (future) capabilities that will take decades to build.

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