Subject: International Relations

Context

• In September 2014, in his first meeting with President Barack Obama, Prime Minister Narendra Modi talked about making the US a principal partner in the realization of India’s rise as a responsible, influential world power. This was in a way the first time that any Indian prime minister had talked about the country’s ambition to grow into a responsible, influential world power.

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India in World politics

• India is not new to playing a proactive role in world politics: Right from Independence, India’s leadership had actively pursued an agenda that favoured the interests of developing or less developed countries.
• India took a form stand against the domination of developed countries: Whether it was the GATT negotiations or the Non-Proliferation Treaty, India took a principled stand and stood up to the policy domination of the developed world.
• India as a protector of developing world: India’s role as the protector of the interests of the developing world during WTO negotiations has been significant.
• For instance: Murasoli Maran, as the Minister of Commerce in the Vajpayee government, played a very critical role in preventing developed countries from pushing through their trade and commercial agendas. The UPA government continued that approach, inviting opprobrium and occasional isolation from the interested players. However, that didn’t deter India from opposing agendas that were seen as against the interests of not only its people but also the larger developing world.
• India added moral dimension to the developing world but seen as obstructionist: India’s significant contribution in all these fora was that it added a moral dimension to the developed world’s monetary vision. However, India, in the process, acquired the image of being a nay-sayer and obstructionist.

India’s smart shift in its approach

• Stated playing proactive role: While standing up for the developing world and zealously upholding its strategic autonomy, India started playing a proactive role in finding solutions.
• Paris climate summit provided a major opportunity: The Paris Climate Summit in 2015 provided the first major opportunity for India to highlight its new priorities. It played a pivotal role in clinching the climate deal while ensuring that the interests of the developing world are not compromised.

1. India’s stand in the words of PM Modi: PM PM Modi cogently articulated this stand on the eve of the Summit: “Justice demands that, with what little carbon we can safely burn, developing countries are allowed to grow. The lifestyles of a few must not crowd out opportunities for the many still on the first steps of the development ladder.” India’s efforts resulted in developed countries agreeing to the principle of “common and differentiated responsibility”.
2. India successfully convinced developed countries for INDCs: India also convinced developed countries to agree to the formulation of not externally imposed targets but “intended nationally determined contributions” or INDCs.

• India emerged as a powerful player during Covid pandemic response through “Vaccine Maitri”: India’s arrival on the global stage as an important player was further augmented by its constructive response during the Covid pandemic. Besides undertaking the massive exercise of vaccinating its billion-plus citizens, India came to the rescue of more than 90 countries by ensuring a timely supply of vaccines through its “Vaccine Maitri” programme.
• Commendable economic recovery in post-Covid world: India’s growing importance is conspicuous in many areas. Its post-Covid economic recovery has been commendable, with the World Bank even revising its projections for 2022 GDP growth from 6.5 per cent to 6.9 per cent. The IMF estimated it to be at 6.8 per cent while the rest of the world was projected to grow at 4.9 per cent.

India in a new year

• Stronger ties with African nations: The India Africa Forum Summit (IAFS), started in 2008 as a triennial event by then Prime Minister Manmohan Singh, met for the third time in 2015 in Delhi. PM Modi took a special interest in cultivating stronger ties with African nations which led to the highest-ever participation in the Summit. It is important to revive the process.
• India’s crucial role in Russia-Ukraine war: At the Bali G20 Summit, India played a crucial role in ensuring that both Russia and its critics like the US had their say on the Russia-Ukraine war in a dignified way without being interrupted. On its part, India conveyed to the Russian leadership that it was not a time for war. The new year will bring an opportunity before India to play a role in ending the war.
• Opportunity to set new agenda for global public good: As G20 chair, India has the opportunity to set a new agenda before the world’s most powerful block of nations. In the past, it always worked for the judicious sharing of global public goods. It is time now to undertake similar efforts for global digital and genetic goods.

Way ahead

• India must continue to act as voice of global south: While striving to achieve its ambition, India must not lose sight of the principles that it always championed. It must continue to act as the voice of the Global South.
• Focus on neighbourhood must increase: India’s diplomatic, strategic and political investments in its neighbourhood and Asia, Africa and Latin America must increase.
• Attention in ASEAN IOR must grow: With SAARC failing and BIMSTEC remaining a non-starter, India’s attention to the ASEAN and Indian Ocean neighbourhood must grow. India’s Act East policy needs more teeth.
• India must bring moralist dimensions in new tech developments: India always upheld moralism in global politics. In climate talks, too, the Indian side is resorting to traditional wisdom to achieve global good. India must bring that moralist dimension to new technological developments.
• India must lead to regulate technologies for humanity’s future: The advent of artificial intelligence and genetic manipulation technologies is going to throw the world into turmoil. If not regulated globally on time, these technologies are going to play havoc with humanity’s future.

Conclusion

• The country is entering the new year on a buoyant note. The leadership of important multilateral bodies including the G20 and SCO has come into its hands. The new year is thus going to provide India with the opportunity to fulfil its world power ambition. However, opportunities come with challenges. China may try to curtail India’s ambitions by keeping the border tense. India needs to maintain harmonious balance.

Mains question

Q. From wars to the economy to climate, India has become integral to the contemporary global discourse. What will India need to do to fulfil its global superpower ambitions in the new year?

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Context

• The presidency, which India has recently assumed for the period between 1 December 2022 and 30 November 2023, will likely open more avenues for cooperation on multiple fronts with countries like Saudi Arabia, a key Gulf Cooperation Council (GCC) country, also a member state of G20.

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India-Saudi Arabia Relationship

• Fourth largest trading partner: Since the last few years, India-Saudi Arabia relations have become comprehensive and robust, with the kingdom not only becoming New Delhi’s fourth largest trading partner but also an important collaborator in the joint combat against all forms of terrorism, money laundering, and terror financing.
• 18% of India’s energy Imports: It is noteworthy that the bilateral trade in the fiscal year 2021-2022 stood at US$42.8 billion, and the kingdom alone accounts for 18 percent of India’s energy import, which reflects the significance of the country from the standpoint of New Delhi’s energy and economic security calculus.
• Collaboration on defence corridor: Simultaneously, military-security and defence cooperation have also gained momentum, which has been triggered by a certain commonality of security threats and challenges, and the interests of the respective governments to collaborate in the defence industrial sector (within the ambit of their military modernisation programmes).
• Non-oil areas of cooperation: The ties between the two countries, now, are not only concentrated on the oil-energy trade alone (as it has been the pattern) but both sides have started to explore the possibilities of working together on domains such as renewable energy, climate change, healthcare, food security, education, technology, etc.

Partnership in Green and clean energy

• Collaboration with Indian companies: In November 2020, Narendra Modi, the Indian Prime Minister, called on foreign investors to “invest on their own” or to collaborate with Indian companies in the country’s green energy sector.
• Reducing dependency on hydrocarbon: Similarly, Saudi Arabia, striving to reduce its dependency on a hydrocarbon-based economy, is investing in the same sector.
• Saudi Vision 2030 programme: In line with its Saudi Vision 2030 programme, it launched (in 2021) the Saudi Green Initiative which works on “increasing Saudi Arabia’s reliance on clean energy, offsetting emissions, and protecting the environment.
• Ambitious targets by both country: Riyadh, ushering in a new era of energy diplomacy, is building partnerships with countries that have similar ambitions. This, to a great extent, has facilitated the need to expand cooperation with India in the renewable energy sphere. While the Indian government works towards generating 450 Gigawatt about 60 percent of electricity using renewable and clean sources, Saudi Arabia also aims at about 50 per cent, both to be achieved by the year 2030.

India-Saudi Arabia cooperation in health sector and during Covid19

• Cooperation with west Asia region: India has stepped up its healthcare-related engagements with the wider West Asian region, and, particularly in matters related to the production of vaccines, joint medical researches, exchange of best-fit practices, and so on.
• Healthcare professionals to Saudi Arabia: During the peak of the aforementioned pandemic, the Indian government assisted its Saudi counterpart in their fight against this outbreak, mainly by dispatching hundreds of Indian healthcare professionals.
• Vaccine acceptancy: Saudi Arabia was also one of the few countries that recognised “Serum Institute of India’s Covishield as an approved COVID-19 vaccine” for any travellers who wanted to enter the kingdom.
• MoU on health and medical products: Now, what could act as a catalyst in elevating the interactions from the existing level is the Indo-Saudi Memorandum of Understanding (MoU) on health and medical products regulations that were signed during the 2019 visit of Modi to Riyadh.

Cooperation in Food Security

• Investment by Saudi and UAE: It could be noted that, in 2019, to act as a safeguard from any food insecurity, UAE and Saudi Arabia GCC states decided to invest in India’s organic and food processing industries.
• Win-win situation in food cooperation: With India’s expertise in the field of crop production and overall agricultural activities, and also being a net exporter of agricultural commodities (especially rice), strengthening of partnerships could prove to be highly beneficial for the populace of Saudi Arabia and the UAE, and other GCC countries that continue to depend on external sources for their food security, mostly owing to the lack of fertile soil.

Conclusion

• While India-Saudi Arabia ties are expected to grow further, there also exists a potential for collaboration beyond this bilateral engagement. This is precisely because, in the emerging international order, there is also a growing call for a collective response to the multidimensional crises the world is facing today.

Mains Question

Q. Briefly describe the India-Saudi Arabia relationship? How both countries are collaborating on clean energy and food security?

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Context

• Russia marks two anniversaries the 100th anniversary of the founding of the Soviet Union and the 31st anniversary of its dissolution. Following the Bolshevik Revolution in November 1917, the Soviet Union was proclaimed on December 30, 1922. Until its dissolution on December 26, 1991.

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How India looks at Russia?

• Special Strategic Partner: Vladimir Putin’s Russia continues to be valued as the heir to the Soviet Union and as a special strategic partner.
• Ukraine war has not affected the ties: Putin’s aggression against Ukraine and his brutal bombing of its civilian population, which Moscow claims is an integral part of Russia, has hardly made a dent in the way the Indian political classes think about the crisis.
• Russia as anti-imperialist: On the left and centre of the Indian political spectrum, the Soviet Union has been viewed purely through the ideological lens of progressive politics nationalist, internationalist, communist and anti-imperialist. That lens, however, is detached from the history of Russia and the continuing struggles for its political soul.
• Russia as best friend forever: Within the strategic community, the conviction that Russia is India’s “best friend forever” leaves little room for a nuanced view of Russia’s domestic and international politics.

Understanding Russia’s behaviour through Russian History

• The Bolshevik Revolution: It is initially sought to destroy the Russian Orthodox Church, eventually leveraged it in the deification of the Soviet state and lent a religious colour to the claim of Russian exceptionalism.
• Alliance with orthodoxy: Putin has taken the alliance with the Russian Orthodox Church to a higher level. For the Russian nationalists today, the effort to take back Ukraine is a “holy war”.
• Limited sovereignty to other communist state: After the Second World War, Soviet Russia insisted that fellow communist states had only “limited sovereignty” and Moscow had the right to intervene to keep them on the straight and narrow path of socialism and prevent their destabilisation. The military invasions in Hungary (1956), Czechoslovakia (1968), and Afghanistan (1979) were motivated by this impulse.
• Russia has not given up Imperialist tradition: In claiming that Ukraine has no sovereignty of its own, Putin is merely following that imperial tradition as well as the conviction that Ukraine, Belarus and Russian-speaking people everywhere are part of the “Russkiy Mir” or the “Russian world”.
• Mao’s characterization of Russia: After he broke from the Russian communists, Mao began to characterise Russia as an “imperial power”. Mao had not forgotten the persistent tension between the Chinese and Russian empires.

Analyzing Russia’s internal politics

• Weak federalism by Lenin: The founder of the Soviet Union, Vladimir Lenin warned against the dangers of “great Russian chauvinism”. He insisted on structuring a federal polity with the right of various nationalities to secede.
• Strong soviet by Stalin: Stalin, however, turned Russian federalism into a hollow shell and erased the difference between the “Soviet Union” and “Soviet Russia”.
• Putin refuse to recognize Ukraine: Putin denounced Lenin for giving a separate identity to Ukraine. “Modern Ukraine”, Putin said, “can with good reason be called ‘Vladimir Ilyich Lenin’s Ukraine’.”
• Stalling the democratic process: The enduring autocratic impulse in Moscow that is rooted in the stalled democratic revolution. Traditionally, the Russian fear of disorder has left the population to put great faith in strong leaders.
• Centralising tendency: The frequent but unsuccessful efforts at political liberalisation have left a fertile ground in Russia for centralising power under leaders like Putin and increasing the chances of grave miscalculation.

What should be the India’s approach towards Russia?

• Not directly criticize Russia: Although it has been reluctant to directly criticise Russian aggression, official India is not blind to the fact that Putin’s “special military operation” has gone horribly wrong.
• Taking note of changing world order: India will inevitably find ways to adjust to the tectonic shifts in the world order triggered by Putin’s misadventure.
• Learning from Putin’s mistake: The Indian political and strategic communities must come to terms with the many complex factors that have contributed to Putin’s egregious errors in Ukraine.

Conclusion

• To understand how the war in Ukraine might play out and its longer-term consequences for India, India’s discourse must pay greater attention to the turbulent history of Russia and its troubled relations with its Central European neighbours.

 

Context

• The third round of negotiations of the India-European Union (EU) free trade agreement concluded recently. The two sides are also negotiating an investment protection agreement (IPA), which will contain investment protection standards and an independent mechanism to settle disputes between investors and states under international law.

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Why EU is seeking Investor Protection Agreement?

• Regulatory troubles in India: Notwithstanding the laudable intent of the government to welcome them, foreign investors in India have often got into numerous regulatory troubles with the state.
• Investors have sued India: Several foreign corporations like Vodafone, Cairn Energy, Nissan, White Industries, Telenor, Nokia, Vedanta have sued India to enforce the rights guaranteed to them in bilateral investment treaties (BITs). This is the main motivation behind the EU seeking an IPA with India.
• India’s past of unilaterally changing the laws: EU investors can rely on Indian law for protection. But Indian law can be unilaterally changed to the detriment of the investor.
• Slow Judicial process: The Indian judiciary is agonisingly slow in resolving disputes. Thus, the longing for protection under international law.

What are the hurdles finalization INDIA-EU treaty?

• Non-justiciable tax regulations: India wants to push taxation measures outside the scope of the treaty by making tax-related regulatory measures non-justiciable. The EU has difficulty accepting this proposition given the recent history of India’s tax-related investment disputes with Vodafone, Cairn Energy, and Nissan.
• Two tier court system: The EU’s investment proposal to India talks of creating a two-tier court-like system with an appellate mechanism and tenured judges to resolve treaty disputes between investors and the state.
• EU’s proposal of MIC: This proposal is connected to the EU’s stand internationally for creating a multilateral investment court (MIC), negotiations for which are going on at the United Nations Commission on International Trade Law (UNCITRAL). The MIC is aimed at overcoming the weaknesses of the current arbitration-based system of settling investor-state disputes.
• Lack of clarity from India’s side: India’s position on creating an investment-court-like system is unknown. India hasn’t publicly contributed to the ongoing negotiations at UNCITRAL towards establishing a MIC.

What is the issue of MFN and FET?

• EU wants the MFN status: The EU’s investment proposal contains a most favoured nation (MFN) provision to ensure that EU investors do not face discrimination vis-à-vis other foreign investors.
• India don’t want to include MFN: On the other hand, India’s position is not to include the MFN provision in its investment treaties because of the apprehension that foreign investors will use the MFN clause to indulge in disruptive treaty shopping. The solution to such disruptive treaty shopping is to negotiate for a qualified MFN provision and not exclude it altogether.
• Fair equitable treatment: EU investment proposal contains what is known as a fair and equitable treatment (FET) provision, which is missing in the Indian 2016 Model BIT.
• Making the state liable: The FET provision protects foreign investors, for example, by making the states liable if it goes back on the specific assurances made to an investor to induce investments on which the investor relied while making the investment.

Why IPA is need of the hour?

• FDI is stagnant: Overall FDI to India has stagnated for the past decade at around 2 per cent of the GDP. In the case of the EU, while its share in foreign investment stock in India increased from €63.7 billion in 2017 to €87.3 billion in 2020, this is way below the EU foreign investment stocks in China (€201.2 billion) or Brazil (€263.4 billion).
• Negative Impact of BIT terminations: Recent research shows that India’s decision to unilaterally terminate BITs has negatively impacted FDI inflows to India.
• IPA needed to attract FDI: India needs the IPA with the EU to attract FDI for achieving the aspirational milestone of becoming a $10-trillion economy by 2030.

Conclusion

• India needs to put its own house in order. India should review the 2016 Model BIT, as has also been recommended by the Parliament’s standing committee on external affairs.

Mains Question

Q. What is the investor protection scheme and why EU wants to include IPA in Free Trade Agreement with India? what are the hurdles in FTA between EU and India?

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Context

• The Indian Ocean Region (IOR) serves as a connecting hub for global energy and commodity trade and comprises important Sea Lanes of Communication (SLOC) and major choke points. The IOR has become central to the geostrategic aspirations of large powers with vested interests in the region. Small Island Developing States (SIDS) located in the Western Indian Ocean such as Maldives, Madagascar, Comoros, Mauritius, and Seychelles, are being dragged into the great power rivalry as a result.

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Small Island Developing States (SIDS)

• Small Island Developing States (SIDS) are a distinct group of 38 UN Member States and 20 Non-UN Members/Associate Members of United Nations regional commissions that face unique social, economic and environmental vulnerabilities.
• The three geographical regions in which SIDS are located are: the Caribbean, the Pacific, and the Atlantic, Indian Ocean and South China Sea (AIS)
• SIDS were recognized as a special case both for their environment and development at the 1992 United Nations Conference on Environment and Development held in Rio de Janeiro, Brazil.

Significance of Small Island Developing States (SIDS) of IOR

• SIDS are strategically important: The geographical location of SIDS islands is of strategic importance, ever since the Indo-Pacific architecture materialised.
• Provides easy access and a base for replenishment: The islands provide easy access to the choke points, are located close to important SLOCs, and can serve as a base for the replenishment of resources for maritime powers conducting surveillance in the region.
• Engagements boosts maritime expanse: The bigger powers have been engaging with the islands on a larger scale to boost their presence in this maritime expanse.

Challenges faced by SIDS

• Multiple challenges: The SIDS, by nature, face multiple challenges due to their remote locations, size, fragile ecosystems, small population, and limited resources and capabilities. Most of the SIDS are classified as middle-income states, but SIDS like Comoros are among the Least Developed Countries (LDCs).
• Economies are not diversified: The economies of these states are not diversified and are highly dependent on a few sectors like tourism and fisheries.
• Climate change and losses due to natural disasters: Climate change exacerbates their challenges, adding an extra burden on their frail economies. The SIDS account for two-thirds of states that suffer the highest relative losses (1 percent to 9 percent of GDP per year) due to natural disasters.
• Rising sea levels and impact on various economic sectors: Apart from the threat of the low-lying islands going underwater in the future, rising sea levels directly impact the economic sectors of the SIDS. For instance, saltwater intrusion affects freshwater resources and diminishes the quality of agricultural land.
• Largely dependent on food imports: The SIDS are already largely dependent on food imports as 50 percent of the SIDS import more than 80 percent of their food. A further reduction in food production will increase their dependence on food imports. Self-sufficiency is a distant dream for SIDS in this aspect.
• Fishery industry a major contributor of economy facing challenges of loss of EEZ: Fish exports account for a large share of the revenue for these states. The fishery industry faces challenges of loss of Exclusive Economic Zones due to shifting baselines, and Illegal, Unreported and Unregulated (IUU) fishing.
• Rising sea temperature: Additionally, rising sea temperatures also negatively affect marine biomass in the resource-rich zones of SIDS.
• Tourism industry hampered by Pandemic: Almost 50 percent of the GDP of SIDS like the Maldives and Seychelles, depends on the tourism industry which was hampered by the pandemic. T

Powerplay and China’s maritime development strategy in SIDS of IOR

• Concerns about increasing influence China: Powers such as the US, Japan, Australia, and India are largely concerned with the increasing influence of China in the region.
• China’s island development strategy: Islands play a major role in China’s maritime security policy, as is evident by its island development strategies in the contested South China Sea and cooperation initiatives with island states in various geographies.
• Vulnerable SIDS welcomed Support initiatives from China: The SIDS have welcomed the development and support initiatives from China owing to their vulnerabilities. From a port development project in Madagascar and major infrastructure development projects in the Comoros islands to a Free Trade Agreement with Mauritius and development assistance to Maldives; China has firmly embedded its roots in the region.
• Maldives in debt trap seeks India’s assistance: When Maldives owed a debt of nearly US$1.5 billion to China in 2018, it had to turn to its traditional partner, India, for assistance to prevent an economic crisis.
• Madagascar worries about Chinese debt trap: Madagascar is also heavily surrounded by Chinese presence and involvement in its economy and is worried about being trapped in debt. Chinese-funded enterprises comprise 90 percent of the island’s economy. Chinese migrants left very few job opportunities for the locals, disrupted trade and commerce, and established a monopoly of Chinese products in the market. Such a heavy involvement of China in Madagascar puts it at a high risk of instability and political upheaval. This is a clear example of how the strategic interests of large powers can bring the SIDS to the brink of collapse.

Opportunity to discuss and maintain stability through various forums

• SAMOA pathway: SIDS Accelerated Modalities of Action (SAMOA) Pathway which is an international framework under the UN umbrella that has initiated a stronger action from the international community to support the vulnerable islands. It guides national, regional, and international development efforts to help these states achieve their Sustainable Development Goals (SDGs).
• Alliance of small Island states: Similarly, the Alliance of Small Island States is a representative body of 39 small island states that provides a platform to voice their grievances.
• Indian ocean commission: The Indian Ocean Commission is yet another intergovernmental body that consists of the islands; Comoros, Madagascar, Mauritius, Seychelles and Réunion (French overseas region).

What SIDS must do?

• The SIDS of IOR must strengthen their collaboration with each other.
• They must make a collective effort to make their challenges and issues known to the other actors.
• The SIDS should make use of the opportunity to ensure that the larger powers understand their security interests and include it in the larger security architecture

Way ahead

• In most cases, decisions regarding security in the region have been taken by the influential, and larger powers without the SIDS.
• The SIDS of the IOR can leverage their strategic position and use it to their advantage to make the larger powers acknowledge their security interests and issues.
• The need of the hour is for stronger alliances and regional groupings to emerge, with significant participation of the SIDS, so that other actors do not downplay or overlook their issues and interests.

Conclusion

• The SIDS have been advocating at various international forums for support and assistance to combat their challenges associated with resources, development, climate change, and most of all, survival. Rather than being viewed as pawns in the geopolitical competition, the SIDS must be viewed as important stakeholders in the region. This is the main change in the mindset, policies and approaches that are needed for secure and stable region.

Mains Question

Q. What is SIDS (Small Island Developing States). What is the significance of SIDS in IOR? Discuss the challenges faced by SIDS in the region and suggest a way ahead.

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