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Introduction
US-China trade war deepened in 2019 despite some signs of thaw towards the end. Unexpectedly, President Trump was impeached by the US congress on the charges of having misused his power and for not cooperating with the Congress. Trump described the impeachment as unjustified and driven by the Democrats’ anti-Trump agenda. Britain struggled to exit from the EU but some clarity emerged after Boris Johnson was elected as Prime Minister after the Conservative party won the parliament elections comprehensively.

Russia continued to consolidate its gains in Syria. Russian natural gas started to flow from Siberia to China thereby cementing Russia China ties. Russia also introduced hypersonic glide vehicles in its Armed Forces even thereby introducing a new element into the global arms race.

Uncertainty in Afghanistan continued. US efforts to strike a deal with the Taliban floundered. President Ghani won the presidential elections by a narrow margin. Pakistan lurched from one crisis to another but had a respite with the IMF approving a US$ 6 billion loan to rescue Pakistan’s floundering economy.

As the year ended, apprehensions about a global recession were articulated by many analysts. Oil prices ended about 30% higher than at the beginning of the year.

The year 2019 will also go down as a year of protests. Several countries witnessed public protests including Hong Kong, Nigeria, Iraq, Lebanon, Iran, Venezuela, Mexico, Brazil, Pakistan, France and even India.

These global and regional trends had an impact on Indian foreign policy moves one way or the other.

Expanding Engagement
In the year 2019, PM Minister continued with high-level engagements with world leaders at multiple fora including the UN, SCO, EAS, and BRICS. He also met many leaders including from great powers and the neighbouring countries bilaterally. The external affairs minister laid out the conceptual basis of Indian foreign policy at his talks at various foreign and desi think tanks and interviews.

On the conceptual level, the external affairs minister explained that globalisation is facing serious backlash. India will have to adjust to a multipolar world with multiple power centres. India’s foreign policy will be governed by pragmatism and national interests rather than any specific ideology. It will pursue issue-based policies while engaging with different counties and groupings across the political spectrum.

Indo-Pacific and Indian Ocean
India paid considerable attention to the further development of the concept of Indo-Pacific, which has emerged as a focal point of Indian foreign policy. While India subscribes to a free, open, inclusive, prosperous Indo Pacific, ASEAN centrality remains key to further development of the concept. India’s inclusive Indo-Pacific concept also includes the regions and countries to its west extending right up to the shores of East Africa.

Some years ago, on his tour of Indian Ocean countries, the Prime Minister had introduced the concept of security and growth for all (SAGAR). This was a signal for the onset of a holistic Indian Ocean policy. The Ministry of External Affairs set up an Indian Ocean Division to give shape to the Indian Ocean policy. The Prime Minister gave a call for building an Indian Ocean community. Indian Ocean Rim Association (IORA) can play a role in this. India also indicated that there should be greater coordination among the existing institutions rather than building a new architecture which is not very easy. Involving the Indian Ocean Rim Association (IORA) can be involved in building such a community. The Indian government also posted a Defence Adviser in Madagascar indicating its intention to pay greater attention to the maritime security aspects in the western Indian Ocean.

The quadrilateral cooperation between India, Japan, US and Australia, popularly known as Quad, is emerging as a major concept in India’s foreign policy. For the first time, the foreign ministers of the four countries met on the side-lines of a major event. Quad is also developing its non-security dimension.

India continued with high-level 2 plus 2 dialogue with US, JAPAN and AUSTRALIA. The two plus two dialogue between India and the US carried forward the India-US cooperation a step further. India has stepped up its purchases of Defence equipment from the US significantly. The US has endorsed the Chabahar port concept despite the US sanctions on Iran.

Concepts are important but even more important is the capability to achieve tangible results. India placed a lot of emphasis on connectivity, maritime cooperation, blue economy, maritime security and such ideas. These were proposed at various fora. India is connecting with ASEAN master plan of connectivity. It is also promoting collaboration with the US and Japan to build sustainable high-quality infrastructure in the Indo-Pacific region. The connectivity between Andaman Nicobar and Aceh in Indonesia is an example. Many of these ideas are at the initial stages. Implementing them would require improving India’s delivery capabilities.

Eurasia
India is also paying attention to developing links with Eurasia, on which Russia places a lot of emphasis. Prime Minister attended the SCO summit in Bishkek where he proposed several ideas for cooperation. His visit to Vladivostok gave rise to a new concept in India’s foreign policy vocabulary - Act Far East Policy. The idea of setting up a shipping corridor between Chennai and Vladivostok, announcement of an Indian line of credit of USD 1 billion to promote Indian investment in Russia’s Far East and sourcing high-quality coal from Siberia are some interesting examples of this policy. India seems to be looking at a much wider area of cooperation bringing in Russia into the Indo-Pacific concept although Russia still sees the Indo-Pacific as an essentially US concept designed to sustain US primacy in the region.

Sino-Indian Relations
China- India relations had their difficulties during the year. China supported its all-weather ally Pakistan fully on Kashmir and issued some unhelpful statements after India abrogated article 370 of its constitution. On Pakistan’s behest, it helped organise a closed-door meeting of the UN Security Council to discuss the situation in Jammu and Kashmir. This was bound to upset India. But, the relationship was prevented from further deterioration with the holding of an informal summit meeting between PM Modi and President Xi in Mamallapuram. China is intensifying its efforts to make inroads into South Asia. President Xi Jinping’s visit to Nepal soon after his informal meeting with Prime Minister both was an indication of this policy. China Belt and Road Initiative is being used as an instrument of gaining greater influence in South Asia.

The informal Modi-Xi summit was followed by the 22ndround of Special Representatives’ talks to discuss the boundary question. No substantive progress was made towards the resolution of this long-standing issue. The two sides merely agreed to intensify their efforts to find a mutually satisfactory solution. China’s support to Pakistan continued undiminished, particularly in the context of the Belt and Road Initiative.

Trade
Trade has come to occupy a prominent place in India’s foreign policy. The US withdrew the GSP concessions to India and demanded that the Indian makes may be opened to US agricultural products. India’s attempts to enforce data localisation also drew sharp reaction from the US. US President issued some sharp statements criticising India’s trade policies. The negotiations between the two sides were held but the issues have not been resolved as yet.

India at the last moment decide not to join the RCEP because of the failure on the part of RCEP countries to address Indian concerns. But it also emerged that the Indian industry is not competitive to withstand duty-free imports from ASEAN countries. This gave a set back the Act East policy of India.

Terrorism
Pulwama terror attack and the subsequent air force strikes on terrorist camps in Balakot in Pakistan signalled to Pakistan that India would not hesitate to take actions to enforce its zero-tolerance policy towards terrorism. India also succeeded in getting Masood Azhar declared as global terrorist by the UN thus overcoming the long-standing Chinese technical hold. Pakistan remained in the grey list of the Financial Action Task Force (FATF). India succeeded in isolating Pakistan in the international community to some extent although Pakistan fought back by raising Kashmir repeatedly at the international fora and securing IMF loan as well as some financial help from the UAE Saudi Arabia and China. The US, despite reservations about Pakistan’s involvement with terrorist groups, was compelled to engage with Pakistan on the Afghan issue thereby relieving the pressure on the latter.

ITEC
In 2019, India celebrated 55th anniversary of its flagship capacity-building programme ITEC. During these years India has provided 200,000 scholarships in 164 countries of the global south for training in areas like health, education, agriculture, banking, IT etc. in the premier institutes. With the focus on our immediate neighbourhood and our African partners, ITEC offers around 12,000 scholarships every year to professionals across a wide range of expertise.

International Fallout of Domestic Issues
During the year, India’s formidable foreign policy machinery had to be deployed to contain the external fall out of some domestic issues. The abrogation of article 370 of the Constitution, the arrest of the political leadership in Jammu and Kashmir, the ban on the internet was criticised in the western media, the US congress, the OIC etc. Similarly, in the wake of passage of the Citizenship Amendment Act (CAA), which was followed by violent protests and clashes between police and the protestors were adversely commented upon in the western media. These articles raised questions about whether minorities were safe in India and whether India was compromising with the secular character of its constitution. Many of these commentaries were based on misinformation and lack of understudying of the law. India’s image was sought to be tarnished. The mention of the Pakistan, Bangladesh and Afghanistan in the CAA gave an external dimension to domestic law. The India Japan summit scheduled to be held in Guwahati was postponed because of the bad security situation and two senior ministers from Bangladesh cancelled their visits to India. The issue is likely to remain alive in 2020. It needs to be watched whether investor sentiment would be affected. Malaysian PM issued some statements on CAA to which the Indian government reacted sharply.

Outlook for 2020
Indian foreign policy will have to be conducted in the backdrop of growing global uncertainty and turbulence in 2020. The US and China are fighting for dominance, although their economies are coupled largely. Russia and China are strongly opposed to US dominance in world affairs. They will certainly continue to oppose US hegemony.

Global economic outlook is uncertain. This will have an impact on the Indian economy as well which is presently follow not doing so well. India will face difficulties in increasing its exports. Higher oil prices will have a negative impact on the government’s fiscal position. Although the foreign direct investment in India in 2019 was healthy, the trend in 2020 may not be as bright considering the global economic conditions.

BREXIT opens-up opportunity for an Indo-UK trade deal. The two sides needs to work closely to realise as soon as possible a mutually acceptable agreement. Similarly, India-EU trade and economic cooperation agreement has made little progress in the last few years. Negotiations could be fast-tracked.

India is on the verge of auctioning spectrum for 5G technologies. The financial health of the Indian telecom operators is precarious. Opening up of the 5G telecom sector could lead to higher imports of 5G, take the technologies, which could increase reliance on foreign inventors in a sensitive sector.

After the success of international Yoga Day, India could take more initiatives to project its soft power in 2020. One initiative could be to get a resolution passed in the UNGA to have a day dedicated to harmony in diversity and Vasudhaiva Kutumbakam, which are recurring theme in Indian p[philosophy and would be acceptable to others as well.

Indian foreign policy will need to be tailored to ensure that in the emerging world order, it is not sidelined and it maintains its distinct identity. India must define its own goals while keeping in view its own strengths and weaknesses. In recent years, India’s global standing has improved because of its rising economy and inclusive foreign policy. The recent difficulties at home on the economic and political front have produced new challenges for Indian foreign policy. India must resolve these difficulties quickly to retain its relevance in the emerging world order.

Arvind Gupta (Director VIF)
10 January 2020

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