In the recent G20 meeting, finance ministers faced difficulties in deciding its agenda, as the US and its allies wanted to discuss new sanctions against Russia and security guarantees for Ukraine, while Moscow and Beijing preferred to criticize Western “blackmail and threats.”
War:
Indian officials hosting the meeting attempted to avoid using the word “war” in any joint statement and suggested that Russia’s attack on Ukraine was beyond the mandate of finance ministers and central bank governors.
However, attendees acknowledged that Putin’s illegal invasion of a neighbouring country had an impact on the global economy and was worth at least a passing mention. Ultimately, no official statement was released together.
As China becomes more assertive and Russia more aggressive, India is becoming increasingly important politically, economically, and militarily on the world stage.
With the second-fastest-growing large economy in the world last year, India is a good candidate for countries rethinking their approach to China. Two other reasons for this shift are ongoing efforts to limit China’s technological parity with the US and China’s plateauing economic growth.
India’s working-age population is still growing, while China continues to be hobbled by its one-child policy. India’s economy is also on the rise, with predictions that it will be the world’s third-largest economy as soon as 2027. One month after Rishi Sunak’s first in-person meeting with Modi in November, a mutual migration agreement was reached.
Sunak, who practices Hinduism and has close family ties to India, emphasized that a trade agreement is just one aspect of a larger relationship with New Delhi. He also stated that he is not willing to prioritize speed over quality in trade negotiations.
While there have been concerns about Prime Minister Modi’s approach towards democracy and the treatment of Muslims in India, it presents an opportunity to carefully navigate and manage the relationship with the country. By maintaining a delicate balance, both countries can foster a positive and mutually beneficial partnership.
India’s economic journey has been complicated despite its population growth from 340 million to 1.4 billion since gaining independence from Britain. Although India was expected to become the next China, it has struggled to achieve this goal due to a fragmented domestic market, lack of large companies, and inadequate manufacturing.
However, India’s economic progress has been seen in the growth of its number of billionaires and the fact that it surpassed the UK to become the fifth largest economy globally, with a significant stock market and a considerable number of start-ups worth over $1 billion.
Despite these achievements, Prime Minister Modi’s decisions have caused some setbacks, such as banning banknotes in 2016 and a shadow banking crisis in 2018.
Moreover, India’s history of protectionism and import substitution, along with its recent policy of “self-reliant India,” has led to concerns about its commitment to trade deals and openness to foreign competition. Additionally, Modi’s political dominance may lead to autocracy, given the Bharatiya Janata Party’s tendency to stoke religious tensions and suppress opposition voices.
The recent gas price hike by the ruling party has triggered protests, and the arrests of opposition politicians have raised concerns about Modi’s anti-democratic tendencies.
The recent raid of the BBC’s offices in India by tax officials and seizure of documents and phones belonging to journalists after a documentary critical of Modi was blocked by the government has further raised concerns about press freedom and the government’s intolerance of criticism. Although the Indian government has accused the BBC of bias, the episode is unlikely to escalate into a full-blown diplomatic spat.
