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Modi’s Foreign Policy :‘NEIGHBOURHOOD FIRST’& FDI, By Ashok B Sharma, 30 Dec, 2014 Print E-mail

Round The World

New Delhi, 30 December 2014

Modi’s Foreign Policy


By Ashok B Sharma


Circa 2014 was assuring for India’s foreign policy. There were a number of incoming and outgoing visits by the heads of Government and State. India’s interaction with powers like the US, Russia, China, Japan, Australia, South Korea took place. There was a gap in the activity at the top level in April and most of May due to the election process in the country. With the change of the Government in May 26 after the polls, some expected a definite change in the country’s foreign policy owing to ideological reasons. But belying their hopes this did not occur as it logically should. What happened was not a shift in the country’s foreign policy, but in the emphasis in certain areas.


The new emphasis in the country’s foreign policy is ‘Neighbourhood First’ Another emphasis is to engage with major political and economic powers for inviting investments. Prime Minister Modi even went out of his way to personally reach out to Indians settled abroad, particularly during his visits to the US and Australia and urged them to be partners in the ‘Make in India’ programme.


The exchange of visits between Modi and Prime Ministers of Australia and Japan in a calendar shows the assuring nature of relationships. Modi’s visit to the US is being reciprocated by US President Barack Obama on January 26, 2015. Following South Korean President Park Geun-hye’s visit to India in January, this year, External Affairs Minister Sushma Swaraj planned a visit to Seoul by the end of Circa 2014.   


The most striking example to show there is no shift in the country’s foreign policy was India’s position on Israel’s attack on Gaza strip. Swaraj assured Parliament that there was no change in policy towards Israel and Palestine. India condemned the inhuman attack on civilian population in Gaza, called for restrain on both sides and restoration of peace and start of the dialogue process.


In fact, the noticeable change in the emphasis in foreign policy was marked from day one of the new Government on May 26, when Modi took his oath as Prime Minister. The leaders of all SAARC countries were invited at the swearing-in ceremony. Thereafter, the next day, Modi had bilateral engagements with all leaders including the Speaker of Bangladesh Parliament who represented the Prime Minister Sheikh Hasina. The message that Modi gave was that India intends to make South Asian countries as partners in its economic development and present the region as a united bloc in the global fora.


But Modi’s ambition hit the roadblock when the foreign secretary-level talks between India and Pakistan at Islamabad were called off as Pakistan High Commissioner Abdul Basit went ahead to talk with the separatist Hurriyat leaders of Kashmir. New Delhi maintained that Kashmir issue can be resolved bilaterally between the two nations without involvement of any third party.


This had its impact on the 18th SAARC Summit in Kathmandu. Pakistan refused to give its consent to the signing of three agreements – cooperation in power sector, motor vehicle agreement and regional railways agreement. Finally, with the intervention of Nepalese Prime Minister Sushil Koirala the agreement on cooperation in power sector was signed after the SAARC leaders met at the retreat, where Modi finally shook hands with Prime Minister Nawaz Sharif and exchanged pleasantries.


New Delhi has long being pleading with Islamabad to take action against terrorists operating on its soil and booking those involved in 26/11 Mumbai terror attack. After the recent gunning down of innocent children at an Army school in Peshawar, Pakistan has declared to take firm against the terrorists. Many analysts believe this may be a turning point in Pakistan’s policy.


It is unfortunate that the SAARC process is being held up over political differences between India and Pakistan. SAFTA is being held to the hostage over the difference between two major countries in the region. Also the process of moving towards a South Asian Customs Union and South Asian Economic Union is being delayed.


India has border dispute with it’s another immediate neighbour, China. But the political differences between New Delhi and Beijing have as yet not held economic cooperation to hostage. Such should be the relations between India and Pakistan. Apart from allowing smooth entry of Indian goods, Islamabad should also give access to these goods to enter Afghanistan by land route. During Chinese President Xi Jinping’s visit many agreements were signed, some of which are of economic and cultural cooperation. China assured $ 20 billion investment.


Prime Minister Modi has also cherished the idea of integrating South Asia with South East Asia. He has already sounded that if Pakistan is not willing to join the process, he will move forward with others – obviously suggesting the integration of the sub-regional group, BIMSTEC with ASEAN, which is moving towards an ASEAN Community by 2015. Modi has planned to engage with Buddha diplomacy with South and South-East Asian countries to strengthen the bonds of integration. He has garnered support for Nalanda University in East Asia Summit.


Giving momentum to his plans, Modi declared ‘Act East Policy’ and extended it to Pacific Islands by raising India-Pacific Islands’ Forum dialogue to Summit level. India is ready to join the Regional Economic Cooperation Partnership (RECP) agreement in the region that includes 10 ASEAN countries, Australia, New Zealand and East Asian countries. Australia has agreed to supply uranium to India’s nuclear power plants.


Modi has expressed India’s eagerness to join the proposed Eurasian Union during the recent visit of Russian President Vladimir Putin. During his visit a number of agreements were signed, including cooperation on military training, nuclear power, joint exploration of hydrocarbons and joint study on India-Russia hydrocarbon pipeline.


At BRICS Summit in Fortaleza the agreement to set up a development bank under the first chairmanship of India was an achievement. During his Brazilian visit Modi had the opportunity to meet leaders of Latin American countries. At G20 Summit in Brisbane, India’s suggestions for dealing with base erosion and profit shifting by multinational companies, automatic exchange of tax information to curb the menace of black money was taken on board. 


Modi’s Japan visit fetched 3.5 trillion yen public and private investment and financing within a span of five years. Prime Minister Abe also pledged ODA loan of 50 billion yen to India Infrastructure Finance Company Ltd for a public-private partnership infrastructure projects in India.


It is to be seen that how much the appeals made by Prime Minister Modi to overseas Indians would materialise in the increase of foreign direct investment flow into the country. In the coming years Modi has lot to do to promote his ‘Neighbourhood First’ policy. --- INFA  


(Copyright, India News and Feature Alliance)

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