India's key foreign policy aspects
In his inaugural address at India Global Week 2020 on July 9, Prime Minister Narendra Modi spelled out in detail his vision of "Atmanirbhar Bharat," or "Self-Reliant India." He explained that the concept "merges domestic production and consumption with global supply chains" without "being self-contained or being closed to the world."
Modi added that the national need was to ensure self-sustaining and self-generating growth with an emphasis on "efficiency, equity and resilience."
Atmanirbhar Bharat Abhiyan (translated literally as Self-Reliant India Mission) was officially announced for the first time in May to fight the Covid-19-induced economic slowdown. The use of the term atmanirbhar (selfreliant) refers to Modi's intent not only to free India from over-reliance on foreign supplychain networks but also to create a culture of autonomous thinking and discipline.
At the same time, Bharat (India) stresses the indigenous character of the scheme. With the swadeshi philosophy as the bedrock, the renewed pursuit of atmanirbharta under Modi might allow India to carve a niche for itself. For India's long-term selfsufficiency, one of the goals of Modi's Atmanirbhar Abhiyan is to make India a hub of manufacturing and investment.
But what about the ambit of this selfreliance in India's foreign policy?
For long, the fundamentals of Indian foreign policy have straddled "strategic autonomy" and "multi-alignment." While the Atmanirbhar Bharat campaign may not necessarily lead to a big foreign-policy departure, it indicates India's readiness to follow a renewed path or taking few radical steps in an uncertain time.
In the near future, India's international outlook for economic engagement might transcend from multi-alignment to pointedalignment with a set of countries that are critical to India's economic and strategic interests in promoting an alternative supply-chain network, allowing it to move away from China.
In other words, the concept serves India's strategic intent to enhance its economic footprints in the Indo-Pacific region by strengthening economic relations with countries that are critical to the rules-based global order.
A stronger strategic partnership with greater FTA engagement along with robust defense ties with select countries explains this pointed alignment. This concept, therefore, provides greater emphasis on foreign direct investment (FDI) from countries such as the United States, Japan, Australia and South Korea; India's efforts to engage more intently with the partners as a strategic ploy here.
Importantly, India and the US are looking to revitalize their "exclusive partnership" to provide preferential market access to both nations, as stated by India's previous ambassador to the US Harsh Vardhan Shringla (current foreign secretary) at the farewell reception organized by the US-India Strategic Partnership Forum (USISPF) in January.
Japan too has portrayed itself as India's natural partner in Northeast India by investing in a host of projects including water supply project in Guwahati, the road network in Assam-Meghalaya, forest management and agriculture and developmental projects across the region.
The Japan International Cooperation Agency (JICA) is already partnering with the Indian government in the North East Road Network Connectivity Improvement Project and other transport projects in India such as Mumbai-Ahmedabad bullet-train project, the Metro Rail projects in Delhi, Mumbai, Bangalore, Chennai, Kolkata and Ahmedabad; and the Western Dedicated Freight Corridor from National Capital Region to Mumbai.
India's desire to seek a strategically autonomous and pointed-alignment-oriented foreign policy is not a sudden development. India has been signing several free-trade agreements (FTAs) or economic partnerships such as the South Asia Free Trade Agreement (SAFTA), India-ASEAN Comprehensive Economic Cooperation Agreement (CECA), India-Korea Comprehensive Economic Partnership Agreement and India-Japan Comprehensive Economic Partnership Agreement as a way to enhance economic partnerships in the region.
Moreover, New Delhi's policies such as "Make in India," "Start- up India" and "Digital India," which aimed to open the Indian market to FDI in order to galvanize the economy, were introduced during Modi's first term. India's current move to launch the auction of 41 coal blocks for commercial mining last month was a medium to invite greater foreign investments after the coal mining sector was opened to FDI in August 2019.
India also allowed increased FDI limits in such sectors as aviation, media (animation), insurance, and single-brand retail. This move, particularly in terms of the aviation and insurance sectors, was a huge positive, since these sectors were highly capital-intensive.
However, even as India has chosen to build a strong economy by pursuing privatization in some areas, it has remained uncompromising in its national-security ambition. The government recently made changes in the country's FDI policy to curb "opportunistic takeovers/ acquisitions" of Indian companies, particularly aimed at China.