These days, every city and town of India has numerous posters celebrating India’s presidency of the G20, which commenced on 1 December last year and will continue till the end of this year. The posters describe India as the “Mother of Democracy” and present the theme of India’s G20 presidency – “One Earth, One Family, One Future” – boldly depicting India’s guiding principle of “Vasudhaiva Kutumbakam” (“The World is One Family”). On 1 December, Prime Minister Narendra Modi penned an article describing India’s presidency as being based on “hope, healing and harmony” to address global challenges. The ubiquitous posters also include a quote from Modi’s speech at the G20 summit in Bali last year saying that India’s presidency will be “inclusive, ambitious, decisive, and action-oriented.” Official sources have announced that, during its presidency, India will host 200 G20-related events in 50 cities.
India is clearly looking at the new year with extraordinary enthusiasm. The year 2022 was generally good for India: at the year-end, it completed its successful two-year stint as a member of the United Nations Security Council. Presiding over the Council in December, India highlighted its twin concerns relating to terrorism and reform of multilateral institutions to make them more representative. Earlier, in September, India took over the year-long leadership of the Shanghai Cooperation Organisation (SCO), while in December it assumed the presidency of the G20. All of these responsibilities, taken together, have been seen by some commentators as India’s “golden opportunity […] to shape the global agenda and advocate for its vision of multilateralism.”
This special moment for India is fraught with serious challenges. The war in Ukraine and the rise of China have created conditions for big-power competitions. These have been exacerbated by the US consolidating the Western alliance under its leadership, even as Russia and China are strengthening their political, military and economic ties, possibly setting the stage for a new Cold War. These geopolitical confrontations have given rise to immediate concerns relating to global energy and food security, which call for concerted action by major world powers. Finally, these geopolitical challenges cannot camouflage the ongoing concerns pertaining to the pandemic, the pervasive economic crisis, and the issues of climate change and energy transition that demand international attention.
G20 and the SCO
The G20 today consists of 19 member countries and the European Union, which together represent 85% of global GDP, and account for 75% of global trade and two-thirds of the world’s population. The grouping first emerged as a platform for dialogue that brought together the finance ministers and heads of central banks of selected developed and developing countries in the wake of the financial crisis that swept across Southeast Asia in the late 1990s. It was upgraded to head of state/government level when, in 2008, the world was gripped by another financial crisis. The grouping, bringing together the principal advanced and emerging economies, was successful in managing global panic and restoring economic growth.
The G20 does not have a permanent secretariat – one member takes over its presidency every year and steers the grouping’s agenda. G20 summits also include non-members such as Bangladesh, Singapore, Spain and Nigeria, and multilateral institutions like the United Nations, World Bank, International Monetary Fund and World Health Organization. During India’s presidency, after several meetings through the year, the summit will take place in September 2023.
At the last G20 summit in Bali in November 2022, Prime Minister Modi had called for global peace so that the international community could focus on the issues that needed immediate attention – climate change, terrorism and the pandemic. He pointed out that these problems “can be solved not by fighting each other, but only by acting together,” thus specifically emphasising the need to address the Ukraine conflict with diplomacy and dialogue. His remarks to President Putin at the SCO summit last year that this is “not the era for war” found a place in the G20 declaration at Bali.
This is expected to constitute India’s approach during its presidency. India has identified six areas that need priority attention: digital public goods and digital infrastructure; action on climate, including finance and technology collaborations; clean, sustainable and inclusive energy transition; faster progress on achieving the goals of the sustainable development programme; women-led development, and finally, reform of the major multilateral institutions.
Under this broad rubric, India will give central importance to promoting South-South cooperation; the Indian External Affairs Minister, Subrahmanyam Jaishankar, has said that India will position itself as the leading “voice of the Global South,” and, in this regard, will attempt to “de-politicise” the supply of food grains, fertilisers and medical products. In this context, specific issues that will command the G20’s attention will be: equitable and sustainable growth; food and energy security; Lifestyle for Environment (LiFT); and women’s empowerment.
Towards this end, in January, India hosted a virtual summit, under the title “Voice of the Global South”, which was attended by 120 countries. Thus, India has firmly signalled that it is going back to the principles of non-alignment that resonated in the last century and will anchor its foreign policy by reclaiming the leadership of the developing world.
While the SCO might not have the global resonance of the G20, it has immediate implications for India’s crucial interests. With Iran joining the SCO as a full member in 2023, the stage is set for a robust pursuit of the logistical connectivity projects from Iran’s Chabahar port, to which India has been committed for several years – multimodal transport connectivity to Afghanistan and the five Central Asian states, and the rejuvenation of the International North-South Transport Corridor that goes from Chabahar to Moscow via Azerbaijan. These projects, once operational, will give India a substantial presence in Eurasia and make it a deeper part of regional opportunities and challenges – the energy scenario, trade, and terrorism and extremism.
This will also have longer term implications for India’s geopolitical interests. Leadership of SCO will deepen India’s ties with Russia and enable the two partners to balance China’s influence across the Eurasian landscape, besides, of course, rejuvenating the Russia-India-China (RIC) dialogue platform. Last year, at the SCO summit, Prime Minister Modi had reminded President Putin that this was not the era for war; India’s presidency of the SCO will be the right occasion to convey the same message to China as well.
Great power rivalries
Without doubt, the principal challenge India will have to contend with in 2023 is the management of its relations with China. On 9 December last year, there was a face-to-face confrontation between Indian and Chinese troops at the border along the northeastern Indian state of Arunachal Pradesh. Though no firing was exchanged, a number of Indian and Chinese soldiers were injured.
This encounter is only the latest of such clashes that have occurred several times over the last few years at different points of the undemarcated 3800-km border, referred to as the Line of Actual Control (LAC). However, despite the terminology, the LAC itself is disputed by the two sides, so that soldiers do cross into territory claimed by the other side, thus setting the stage for a skirmish.
Such skirmishes have become a serious matter since April 2020, when India claimed that Chinese troops had intruded into territories claimed by India in the western sector of the border, in the area of Ladakh. This led to actual hand-to-hand fighting between the soldiers in June 2020 in which 20 Indians, including a colonel, were killed, along with some Chinese personnel as well.
Over the last two years, there have been several meetings of military commanders to address matters relating to locating troops at mutually agreed positions to ensure that face-to-face encounters are avoided. However, some disputed areas have not yet been discussed, nor has there been any serious attempt to define the LAC. Meanwhile, ties between the two neighbours have reached rock-bottom and there is deep distrust on both sides.
There have recently been two meetings of the foreign ministers of the two countries – one on 25 March 2022, when Chinese Foreign Minister Wang Yi visited India, and one on the sidelines of the G20 foreign ministers’ meeting in Bali in July 2022. In reference to the meetings, an Indian statement spoke of the minister emphasising the importance of the “three mutuals” – mutual respect, mutual sensitivity, and mutual interests. A Chinese statement said that “bilateral relations have generally shown a recovery momentum,” stating that the Indian minister noted “positive progress” and affirmed that India would “firmly pursue an independent foreign policy.” Surprisingly, during this period of political and military estrangement, the two-way trade between the two countries in 2021 increased by 44% – Chinese exports going up by 46% and Indian exports increasing by 35%.
Amidst this scenario of confrontation and distrust, there have been other reasons for concern for India: China has expanded its naval presence in the Indian Ocean and signalled its interest in the ocean by convening the China-Indian Ocean Region (IOR) Forum in Kunming, on 21 November. Almost all the IOR states, other than India, participated in this conclave, though Australia and the Maldives were represented by non-officials. Thus, China has signalled its long-term interest in the Indian Ocean and, specifically, that it sees its own forum as a competitor of the Mauritius-based Indian Ocean Rim Association (IORA), which is backed by India.
The Indian scholar, Antara Ghosal Singh, has noted that China’s approach to India is based on a contradiction – at the level of great power competition, it wants India to be its partner against US hegemony, but at the same time, as part of its neighbourhood strategy, China seeks to diminish India’s standing. It is in pursuit of the latter that its preferred approach has been to shelve discussions on the border issue, prop up Pakistan against India, and provoke India with periodic skirmishes at different points of the border, hoping thereby to pressurise India into accepting China’s larger claims to regional ascendancy.
This approach has not worked; in fact, it has deeply alienated India from China, encouraged it to enhance its capacities all along the border and in the Indian Ocean, and made it an active partner of Western powers bilaterally and in regional groupings. As Ghosal succinctly states, China “wants to accrue benefits from India, but is unwilling to pay the strategic cost for it” – the latter would include recognising India’s concerns at the border and aspirations in South Asia, and at international fora such as the United Nations Security Council.
Meanwhile, beyond the border, bilateral differences have been further complicated by what India’s distinguished former ambassador to China, Vijay Gokhale, has described as “misperception and mistrust”, which have aggravated mutual suspicions. Thus, China’s policy-makers have viewed India’s growing closeness to the US as a burgeoning alliance directed at China, while India sees China’s expanding footprint in South Asia and its heightened naval activity in the Indian Ocean as deliberate encroachments into India’s strategic space and a direct threat to India’s crucial interests.
Over the longer term, Gokhale suggests that India convey to China ‘the bilateralness of relations’, i.e., persuade China not to view India through the prism of its competitive ties with the US. This approach, he says, would gain credibility through enhanced domestic capacity and alignments with like-minded partners. In the meantime, absent the required level of mutual trust, India and China are likely to live side-by-side in a state of “armed co-existence”.
It is evident that the ongoing military confrontation has ended the earlier state of bilateral relations when both countries had agreed to place the border question on the back-burner and expand ties in other areas; India’s position now is: “the state of the border will decide the state of the relationship.” The reset of relations will need a high-level commitment to work towards a new road map to rebuild mutual trust and address some of the relatively minor irritants in bilateral relations, such as the trade imbalance, while talking openly and frankly about the core concerns that animate each side. In 2023, Modi and Xi Jinping are expected to meet twice – at the G20 and SCO summits. This could mark the commencement of new engagements.
The other challenge Indian diplomacy faces is the need to balance its relations with the US and Russia, in the background of the Ukraine war. All through 2022, India skilfully navigated its relations with both countries, consolidating political and military ties with the US, while asserting its ‘strategic autonomy’ through close and substantial engagements with Russia.
Indo-US naval cooperation has witnessed remarkable upswings: the aircraft carriers of the two countries exercised together in 2020, while in 2021, US and Indian guided-missile destroyers participated in exercises alongside naval vessels from Japan and Australia. These exercises have deepened operational understanding and facilitated the ability of the partners to address maritime security challenges jointly. These include maritime surveillance, replenishment and aviation operations – skills that can be honed in peacetime for serious situations that might emerge in future.
In the coming months, the two countries’ focus is likely to be on expanding domain awareness in the Indian Ocean – maritime issues that impact on safety, the environment, the economy and security. Other areas of shared interest will be exploring cooperation on sea refuelling, support for transiting vessels, and repair and maintenance.
India’s relations with Russia are anchored in defence cooperation. Russia supplies about 60% of India’s defence needs, including guns, tanks, artillery, submarines, helicopters and aircraft, and since 2018, these supplies have exceeded $15 billion in value. India has bought the Russian S-400 air defence system in a $5.34 billion deal, is modernising with Russian cooperation its frigates, air-to-air missiles systems, and its fleet of transport aircraft, has a joint assault rifle manufacturing project in India, and is looking at acquiring very shortrange defence systems and nuclear-powered submarines.
But there is also a significant strategic content to the bilateral relationship: India is a valued investor in Russia’s Far East and the Arctic, investing in the former in pharma and diamonds, backed by a one-billion-dollar line of credit, and pursuing energy exploration in the latter. This includes construction of polar vessels and research in the Arctic to study global warming and impact on the monsoons. The economic content of bilateral relations includes operationalising the Northern Sea Route from Vladivostok to the eastern Indian port of Chennai and linking India’s western ports to the International North South Transport Corridor (INSTC), which stretches from Iran’s Chabahar port to Moscow and St. Petersburg.
Russia is also an important partner for India in managing its relations with China: as noted earlier, Russia’s presence in the tripartite Russia-India-China (RIC) dialogue platform helps to moderate China’s ambitions and further ensures that SCO and BRICS, of which the three countries are members, remain credible regional institutions. As the Indian commentator Major General BK Sharma has noted, India and Russia remain “aligned in their world-view and macro-strategic issues.”
Relations with the Middle East
In India, the new year began with an interesting interaction with the Middle East: Egyptian president Abdel Fattah al-Sisi was the chief guest at India’s Republic Day celebrations on 26 January. This high-profile event had considerable significance, both in terms of symbolism and substance. It marked the recovery of India’s traditionally close ties with Egypt, which go back to the Nasser era of the 1950s when the two countries were partners in the Nonaligned Movement. But it also signalled the interest of the two countries to pursue relations that are relevant to the realities of the early 21st century.
There is clear acceptance across the Middle East that Egypt has now put behind the political and economic crises of the last two decades, which had removed it from the principal regional counsels. With its improved economic situation and political stability, Egypt has now re-joined this regional high table that includes Saudi Arabia, the UAE, Iran and Turkey. This is signified not just by its close ties with the GCC countries – Saudi Arabia, the UAE and, more recently, Qatar. Egypt has also joined Iraq and Jordan in a nascent political and economic coalition, and is engaged in active diplomatic efforts to build ties with African nations in the Horn of Africa to obtain local support in its confrontation with Ethiopia on the Grand Ethiopian Renaissance Dam (GERD) that, it believes, threatens its water supply from the Nile.
What then is India looking at? The shared interests of the two countries are clearly reflected in the joint statement released during the Egyptian president’s visit to India: India and Egypt have committed themselves to upgrade their ties to the level of a “strategic partnership” that would cover political, security, defence, energy and economic areas. In the economic area, trade ties are targeted to reach $12 billion in five years and there will also be a focus on investments and joint ventures, particularly in the high-tech areas, including the defence sector – the joint statement notes the aim of exchanging technology between defence industries. However, though the joint statement only refers to “widening the footprint of military exercises,” the principal relationship is likely to be strategic – maritime cooperation to maintain the security of the Red Sea and the East Mediterranean, both new initiatives for the Indian Navy.
Despite the new outreach to Egypt, given the active, even hectic, diplomatic interactions between India and the GCC states over the last eight years, the latter will remain central to India’s regional interests. In the economic area, relations will move from the traditional bonds of energy and trade to the high-tech sector as India’s qualified personnel, its dynamic start-ups and the regional interest in shorter supply chains will make the GCC states and India natural partners. Saudi Arabia will be particularly important in this regard. The kingdom is India’s fourth largest trade partner: two-way trade in 2021-22 was $42.8 billion, while Saudi Arabia provided 18% of India’s oil imports. The two countries are also partners in combatting extremism, terror financing and money-laundering.
The joint statements signed between the two countries after high-level visits over the last few years have identified the following as new areas for bilateral cooperation: renewable energy, healthcare, food security, technology, climate change, and the defence industry sector. In early 2021, an Indian company, Larsen and Toubro, won the contract to construct in Saudi Arabia the world’s biggest solar power plant, with a capacity of 1.5 gigawatts. Companies from the two countries are presently looking at connecting the Indian and Saudi coastlines with undersea cables to create a green energy grid to address problems due to fluctuations in supply of solar and wind energy. In the area of healthcare, the two countries are looking at joint medical research, adoption of best practices, and coordination in medical products regulations. Specific cooperation areas could be: joint production of vaccines and medicines, funding of joint research projects, exchange of health-related research papers, and exchange of medical personnel in laboratories and teaching institutions.
The UAE is the other significant regional partner for India; in recent years, these ties have been bolstered by regular high-level interactions, including the presence of the then Crown Prince of Abu Dhabi (now Ruler of Abu Dhabi and President of the UAE), Sheikh Mohammed bin Zayed Al-Nahyan, as the chief guest at India’s Republic Day celebrations in 2017, and the UAE conferring its highest civilian award, the Order of Zayed, on the Indian prime minister in 2019. In 2022, India and the UAE signed the Comprehensive Economic Partnership Agreement (CEPA) that exempts 80% of Indian goods exported to the UAE from customs tariffs; this is expected to boost bilateral trade from $45 billion to $100 billion in the next five years. The UAE’s foreign direct investment in India has increased over the last few years and now stands at over $12 billion. In the area of food security, the UAE has invested in India’s organic and food processing industries, besides providing expertise to upgrade food transportation and storage facilities in India. In 2023, there will be greater attention paid to cooperation in the knowledge sector. India has agreed to set up a branch in Abu Dhabi of its prestigious institution, the Indian Institute of Technology. Again, space could be an exciting area for the two countries – in 2017, the UAE’s first nanosatellite, Nayif-1, was launched by an Indian rocket.
Towards a new “strategic culture”
In 2023, India is expected to surpass China and emerge as the world’s most populous country, with both countries counting around 1.4 billion people each (India 1.417 billion and China 1.412 billion). India is also expected to be among the world’s fastest growing major economies: the World Bank recently upgraded the country’s GDP growth from 6.5% to 6.9%. In 2022, it surpassed the UK to emerge as the world’s fifth largest economy, and by 2027, it is expected to surpass Germany to become the fourth largest global economy.
India is comfortable about its population scenario; it hopes to reap a demographic dividend due to its large pool of technically qualified professionals, its solid digital technology base, and the attendant domestic legislation to support its high-tech sector, such as the Digital Data Protection Bill, introduced in parliament in November, as well as the upcoming Digital India Act.
India is also benefitting from international companies moving away from China and looking at diversifying supply chains. A recent initiative is that of Apple to manufacture its latest iPhone in India. Companies are also seeing India is an attractive centre to pursue new technologies, such as semiconductors, hydrogen and ammonia.
In this regard, India has invested in development of physical infrastructure and transportation that has cut costs in the country by 20%. Again, India has a solid technology base: an internet penetration of 43%, coupled with 52% of its population being below 30 years, provides the base for digital skilling. India’s other advantages are its low tariffs and labour costs – wages in India are about $150 per month versus $1200 in China. As global companies move towards Vietnam, Malaysia, Taiwan, Bangladesh and India, the challenge for the latter is to get into regional trade arrangements, while improving the quality of its workforce.
In regard to foreign policy, India has repeatedly affirmed its commitment to strategic autonomy, despite serious US efforts to co-opt it into its anti-Russia alliance. India has robustly confronted these pressures by refusing to join in any sanctions against Russia and, instead, becoming a major buyer of its oil.
In spite of these propitious circumstances, India’s aspirations to emerge as a significant player in regional and global affairs face two principal hurdles. The first one is that Indian policy-makers and officials frequently prioritise high-flown rhetoric over actual achievement, which causes loss of credibility. For instance, despite the commitment to set up logistical connectivity projects from Iran to Afghanistan, Central Asia and Russia as long ago as 2003, no real progress has been made over the last two decades. There have been similar delays in executing connectivity projects from India to Southeast Asia.
Again, India has been a hesitant player in regional economic integration initiatives. In November 2019, India decided against joining the 16-nation Regional Comprehensive Economic Partnership (RCEP) trade deal, saying it was not shying away from opening up to global competition across sectors, but it had made a strong case for an outcome that would be favourable to all countries and all sectors.
Prime Minister Narendra Modi, in his speech at the RCEP Summit, said: “The present form of the RCEP agreement does not fully reflect the basic spirit and the agreed guiding principles of RCEP. It also does not address satisfactorily India’s outstanding issues and concerns in such a situation.” There was a fear in India that its industries would be unable to compete with China and that Chinese goods would flood Indian markets. India’s farmers were also worried given that they would be unable to compete on a global scale. Due to these concerns, India has also opted out of the crucial trade pillar of the US-sponsored Indo-Pacific Economic Framework (IPEF), launched in May 2022.
However, there are recent indications that this approach might change. Last year, India signed trade agreements with the UAE and Australia and is negotiating Free Trade Agreements with the GCC, the European Union, Canada and the UK. Developments in the current year will reveal whether fresh winds are blowing through India’s economic policy-making corridors.
The other challenge facing Indian diplomacy is also domestic and calls for a fundamental change in India’s approach to issues of strategic interest. In 1992, the US commentator, George Tanham, said that India lacks a strategic vision and that its response to matters of security concern was reactive, defensive, ad hoc and short-term. Such an approach still characterises India’s approach today.
But, given the complex global scenario and the challenges that India faces in its strategic space, such an approach is not tenable. What India needs is a new approach to security challenges, one that is founded on a long-term vision of India’s interests, has well-defined strategies to realise this vision (harnessing the required resources – financial, technological and human), and includes annual action plans to implement these strategies, with the strategies and action plans being regularly updated in response to changing circumstances, both domestic and external. In short, what is called for is a new national “strategic culture” – a composite approach to shaping the new world order and India’s place in it.
 Major General BK Sharma, “India’s Foreign Policy in Evolving Geopolitical Scenario,” The Journal of the United Service Institution of India, Vol. CLII, No. 630 (October-December 2022): pp. 480-90, http://bitly.ws/A3Np.
 Government of India – Ministry of External Affairs, “India-Egypt Joint Statement during the State Visit of the President of Egypt to India (January 24-27, 2023),” January 26, 2023, http://bitly.ws/A3Pg.
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