The restructuring of India’s economic policy in the year 1991 and the adoption of globalisation, liberalisation and privatisation has led to enormous changes in the realm of its foreign economic policy. As a result, there was a rapid pace in the process and India withstood the difficulties that arose from the previous policies. The focus shifted to opening up its markets to the foreign nations thereby attracting trade and investment from them. It would not have been possible if it were a passive foreign economic policy of India.
What turned the situation is reorientation of various policies: beginning of Look East Policy-moving closer to the close-by neighbourhood; strengthening relations with near and far East; laying firm foundation to forge strong relations with developed economies; also forging meaningful relations with other developing economies. Changes in foreign economic policy orientation were not only strengthened by domestic events but also India became engaged with different nations at bilateral and multilateral levels to gain economic mileage.
As on today, India is considered as one of the emerging powers whose progress and policies cannot be overlooked. India’s efforts have been praiseworthy in this regard. With the United States and Europe, India has strong economic bonding, which is expected to increase further. Significant trade relations developed between India and Australia for the last decade and half; considerable economic progress has been made with countries like Brazil, South Africa and China; India is reaching out to Japan and Korea; there is a new found bonhomie with African nations especially in terms of economic relations. It is important to mention that India has strong relations with the African continent since the pre and post-independence era. Now with economic policy making inroads to deepen the bonds, it can only be assumed that India has better prospects economically. South East Asia is a region India can rely on considerably to prove its worth as a neighbour that has much to offer. The South East Asian region and India share common cultural features. Also, Buddhism plays a major role wherein peace efforts pay off in a far better way than imposition of any sort. The Act East Policy, it is hoped, will bring better economic opportunities for all the nations in partnership.
The new regime in India that has assumed charge of the government a year and half back seems to be moving in the right direction. With its new initiatives like coming up with Smart Cities and Make in India, we can expect better results that would accelerate its economic growth. This is likely to attract new investments and promote better economic relations. Since much of the stress is being laid on its relations with Central Asia and South Asia, India can hope to do better with its neighbours to promote trade and investment. It is necessary to adopt the right policies if India has to keep pace with different emerging economies. It has to create confidence among the investors that their finances are being invested in one of the most promising economies of the world. Therein lies the success of its foreign economic policy.
As Prime Minister Narendra Modi is pushing for closer political and – in line with his national priorities – economic ties with India’s neighbors as well as partners, every one’s eyes are on New Delhi’s new economic diplomacy policy. While economic diplomacy is most visible and most watched during high-level visits, the real challenge is to make it operate effectively all year long. Some steps in this direction were already taken under the previous government; the Modi government’s recent actions indicate that it intends to carry this further. It should be stated that Prime Minister Narendra Modi’s visits to Bhutan and Nepal, and the invitation of SAARC leaders to his swearing in ceremony, point to an acknowledgement that for India to prosper, the country needs to engage with its neighbours and work towards a stable and peaceful region.You need to subscribe
At the end we can conclude that although prosperity is not a sufficient condition for peace, it is unquestionably a factor that can help in achieving peace and in its maintenance. It is seldom prosperity in itself that reduces tensions, but rather the absence of extreme differences in levels of prosperity. In many cases, trade, as one of the main economic diplomacy tools, can play a facilitating role in fostering sustainable development and peace. Therefore, it is imperative that the international community work to make trade and globalization contribute to successful development. To this end, accelerated economic growth and increased returns from trade should be channelized into achieving human and social development including food security, energy security, rural development, and universal access to essential services, gender equity, and poverty reduction.You need to subscribe
Because of the geographically proximity, shared common history and cultural affinity India and Central Asia are considered natural allies. There is interest today on both sides to strengthen economic cooperation, which would also deepen our overall relationship with the Central Asian states. India's policy towards Central Asia has been ad hoc in nature and reactive rather than taking a pro-active stance toward developments.You need to subscribe
A perusal of India’ s diplomacy reveals the fact that from the mid-1990s, India has slowly shifted away from its rigid opposition to service trade and finally by the mid-2000s adopted an aggressive pro-service liberalization posture and indulged in extensive economic engagements to bolster the image of India as a reliable economic partner. However, there is still room for improvement. A proactive, holistic and integrated approach should replace piecemeal efforts based on adhocism and hasty negotiations to enjoy the perceived benefits. Given the context of enormity of challenges involved, pursuit of matured economic diplomacy is the need of the hour.You need to subscribe
India is a country of enormous prospects in the field of economics, commerce and trade and many more things. The irony is that India itself does not recognise it. It is like a sleeping lion. The time has come for the lion to awaken and very rightly so the Prime Minister’s flagship programme of ‘Make in India” is symbolised by the lion. With the programme like skill development it is hoped that India will transform its vast army of young population into a productive human resource and a parallel to the IT sector will emerge which can contribute in a huge way to the GDP.You need to subscribe
Economic diplomacy has been an integral part of India’s Foreign policy as India always needed investments in the country and wanted its exports to increase. The Modi administration is no different in that sense. The central theme of the present government since it came to power on Foreign policy has been economic diplomacy for attracting investment and also to provide ease of doing business in India and providing relaxed business environment for the International trade especially Indian Foreign trade.You need to subscribe
The McKinsey paper which has been quoted above in the text rightly claims that while solar power can certainly help to satisfy the desire for more electricity and lower carbon emissions, it is just one piece of the puzzle. There are thus, many more challenges that even this newly emerging sector shall have to face and many of them may be common across the world. Several technologies are competing to win the lowest-cost laurels, and it’s not yet clear which is going to win.You need to subscribe
The South Asian Free Trade Agreement (SAFTA) commenced in 2006, envisaging a duty free area by 2016 for all Member Countries. However, the success achieved under the treaty has been quite limited; intra-SAARC trade has continued to be around 4 percent of the total trade of the region. It has been argued that one of the reasons for SAFTA being ineffective is because of the large Sensitive (sometimes called negative) Lists maintained by Member Countries; such items are not offered concessional tariffs.You need to subscribe
In the narrative of the dynamic and yet complex Sino-Indian relations, bilateral economic relations between the two countries occupy a very critical space. With a combined population of 2.5 billion, China and India are the two most populous countries in the world constituting about 38% of world population. Together they account for one- tenth of gross domestic product of the world.You need to subscribe
In what follows is that the new FTP 2015-20 includes various new initiatives, provisions and procedures to provide better condition and ease in foreign trade. It sets the objective to achieve or increase the annual level of the country’s export to 900 billon dollar by 2020. In totality, it makes all plan and procedure to improve our foreign trade. But how far would it be implemented with proper governance is not clear so far.You need to subscribe
It is time that India actually appreciates that the Bay of Bengal is strategically critical connecting the Indian and Pacific Oceans. India must back trans-border connectivity programme with political will. Through a more pro-active involvement in East and Southeast Asia India can emerge as a major actor in the Asia-Pacific and Southeast Asia region. This is paramount for India’s future economic development and strategic vision in the region. India’s economic diplomacy should be more ardent. India’s role is crucial in the changing economic architecture of the region.You need to subscribe
Africa offers India a massive access to commodities, its markets and investments. And economic diplomacy has certainly taken precedence in recent years. Prime Minister Narendra Modi has been very proactive in reaching out to different countries to collaborate at different levels, emphasising also on economic diplomacy. Following the IAFS, there were talks that Modi should project India as an alternative to China, as the Chinese economy is slowing.You need to subscribe
There is no doubt that globalization has established closer economic connections among the world’s countries and diplomacy is playing a central part in the field of trade at the regional as well as international levels. And now economic diplomacy has taken a prominent place in any state’s foreign policy, for instance, Indian foreign policy has taken important measures in the field of economic diplomacy and that is why Make in India initiative has been one of significant aspects of the NDA government.You need to subscribe
Both the regions had historical and civilizational bonds and enjoyed good economic ties. But these economic ties had frozen on account of colonial dynamics for an extended period. With the breakup of Russia, the Central Asia has emerged on the geopolitical landscape. Since then, both India and Central Asia are having good political relations, but the economic ties including trade and investment are at the lowest level despite the launch of several policies. The Modi government took over the reins in 2014.You need to subscribe
To revamp the theoretical debate stated in the paper, realism as a theory of International Relations stresses on the importance of power in the international arena, which it considers anarchic and based on self-help of states. In such a situation, it is every state for itself. On the other hand liberalism espouses the use of reason in the international arena for the realization of peace and justice; it holds that democratic countries have pacific international relations and most importantly that free trade would create a more peaceful international order. Realities of the Indo-Pakistani conflict dyad show how far the progressive theories of liberalism have been undermined.You need to subscribe
New Delhi’s economic policy pursues a dynamic interaction with other countries deepening its commitment towards its goals to deepen and secure national economy, political security and regional integration. ASEAN (Association of South East Asian Nations) in this stance has been a crucial link towards providing regional cooperation among member nations and India. There is little doubt over China’s already grown influence in the South Asia and Asia- Pacific region with it showcasing its hard power status politically and militarily.You need to subscribe
India’s relations with island state of Sri Lanka and Maldives have many ups and downs in recent years. Sri Lanka’s economy is likely to grow at a faster pace but it is not clear whether the ethnic issue would be resolved. Internal tensions in Sri Lanka would put pressure on the country’s growth. India’s relationship with Sri Lanka should be multifaceted. The process of integrating Sri Lanka’s economy with that of India should be continued. Maldives would be struggling with the adverse consequences of climate change and seeking closer ties with India to manage them. India should assist Maldives as comprehensively as possible. The region can progress if the countries of the region create interdependencies and cooperate with each other to tackle common challenges.You need to subscribe
There is no gainsaying the fact that India is emerging as a leading economic power. Economy picks up pace and poverty continues to decrease. India grew 6.3 per cent per annum during 1988-2006 and has registered stupendous annual average of more than 7 per cent since 2006.You need to subscribe