Editorial 2: India and the new world order
Context
It is time India reconfigured its global engagements, going beyond old-world romanticism and Cold War calculations.
Introduction
- Eurasia is in turmoil. Three major conflicts — Russia-Ukraine, Israel’s Gaza operations and the Israel-Iran-US conflict — are reshaping the geopolitics of the region. Wars don’t just cause physical destruction; they profoundly impact international relations.
- Beyond Eurasia, US President Donald Trump is causing serious drift and disorder in the Western world. The US and Western Europe, powerhouses of the last century, appear to be decisively moving into a slow afternoon. At the same time, the world is witnessing the unmissable rise of China as a dominant economic and technological superpower. These developments, coupled with a few other important ones, will lead to the emergence of a new global order.
Major challenge for India
- India developed institutions and initiatives based on the premises of the old world. But the emerging order calls for a new way of thinking about its geostrategic priorities.
- During the ill-fated Cultural Revolution years in China, Chairman Mao Zedong used to call for the abolition of the “Four Olds” — old ideology, old culture, old habits and old customs. This might be a wrong analogy, but India, too, needs to come out of the mindset of the last century.
India and India-Middle East-Europe Economic Corridor (IMEC)
- India has developed strong ties with Europe over the past few decades and, in recent years, has significantly deepened engagement with Middle Eastern powers like Saudi Arabia and the UAE.
- These efforts led to the launch of the India-Middle East-Europe Economic Corridor (IMEC), a promising initiative connecting South Asia with the GCC region and Europe.
- Signed in September 2023 during the G20 summit in New Delhi, IMEC gained attention among strategic experts and think tanks.
- However, with the evolving geopolitical situation in Eurasia, India must recalibrate IMEC carefully. Despite its potential, the project faces major challenges, particularly due to regional instability.
- Moreover, IMEC’s positioning has been flawed, often portrayed as a counter to China’s Belt and Road Initiative (BRI).
- Confusing geo-economics with geo-strategy reflects outdated thinking. Most GCC countries are BRI partners, and 17 of 27 EU members maintain strong trade ties with China. Only Italy has exited the BRI, while others continue to benefit from Chinese investments.
Challenges and Realities of the IMEC Vision
- There is a tendency among some scholars to romanticise IMEC by invoking ancient trade routes between India and Europe via Gulf ports.
- While India indeed traded spices and textiles for Roman gold in ancient times — prompting complaints from Roman scholars about a gold drain — today’s geopolitical and economic realities are very different. For instance, Oman, once central to ancient trade routes, is not even part of IMEC.
- Logistical complexities also challenge IMEC’s viability. Under the current scheme, goods from India would travel by sea to Middle Eastern ports like Jebel Ali (Dubai), move overland to Haifa (Israel), and then be shipped again to European ports such as Marseille (France) and Trieste (Italy).
- While some suggest this route could bypass the Suez Canal to save time and cost, this is debatable. On average, 75 large ships — each carrying over 100,000 tonnes — pass through the Suez daily.
- To replace even one such ship, at least 18.5 freight trains (each carrying about 5,500 tonnes) would be required. The infrastructure required for this would be massive, and key land-route countries like Jordan and Egypt are not yet IMEC members.
- Despite these hurdles, the potential of accessing the $18 trillion EU economy is significant. However, India's prospects must be tempered by the EU’s sluggish growth (around 1%) and China’s dominant position in the EU market, with over 55% share in manufactured goods and increasing presence in other sectors.
Need for Strategic Reconfiguration in India’s Foreign Engagements
- India has a history of announcing ambitious connectivity projects that later stagnate. For instance, the North-South Corridor project, initiated by the Atal Bihari Vajpayee government and signed with Russia and Iran in 2003, remains largely unrealised. In contrast, China capitalised on the delay, establishing strong ties with both countries.
- Similarly, India’s Look East policy of the 1990s, rebranded as Act East under Prime Minister Modi, has delivered limited results. Despite ASEAN becoming a free trade partner in 2010 and a comprehensive strategic partner in 2022, India’s trade with ASEAN stands at $120 billion — far behind China’s rising $1 trillion trade volume with the bloc.
Conclusion
Beyond IMEC, India must deepen its engagement with Eastern and Central Europe, Russia, and ASEAN. This requires moving beyond outdated romanticism and Cold War-era thinking to adopt a multidirectional, goal-oriented foreign policy that reflects today’s geopolitical realities.