Mumbai: India may not have been successful in its bid to have the Brics New Development Bank headquartered in Mumbai — the privilege has gone to Shanghai in China instead — reducing the sheen of Prime Minister Narendra Modi’s maiden multilateral outing, the Brics summit.
Yet, it is early days perhaps to judge the PM who led his party to victory in the elections promising economic revival, growth and development. And for this, the new PM will need to push diplomacy on the economic front too in a bid to boost trade and investment.
Indeed, India’s economic interests are increasingly determining the trajectory of its foreign policy approach in an increasingly integrating world. And the country and the world wait for the new government under Mr Modi to give it a greater thrust and direction, particularly in view of his business and investment-friendly image.
A senior official of the ministry of external affairs noted, “Now, there is a greater sense of urgency to things”, while dismissing reports that the MEA has been asked to “integrate” work with other ministries.
While noting that the MEA in any case closely coordinates with other ministries, the official further said: “There are directions now to work harder and the ministers to work harder.”
Among the first moves in the area of economic diplomacy is the new government’s decision to review all the free trade agreements (FTAs) that India has with other countries.
The government has already said that it is getting an analysis of the FTAs done to determine how beneficial these are for India and how to leverage them to India’s advantage.
An MEA official conceded that the “utilisation and supervision of some of the FTAs that India has been very poor”.
Other elements of economic diplomacy that India has been leveraging and which the new government is expected to give a further impetus to are the diversification of export markets, promoting energy security and promoting FDI.
The new government is also expected to be more aggressive in WTO negotiations to allow Indian products greater access under the Doha Development Round.
Also on the Modi government’s list of priorities will be China with whom India has been trying to bridge a huge trade deficit and economic powerhouse Japan and the Asean countries.
Mr Modi has already said that partnership with Japan will be accorded high priority by his government. Infrastructure and manufacturing are among the sectors the new government may look to for the Japanese to play an important role.
Another challenge for the Modi government would be to revitalise bilateral trade between India and the US that has been marked by disputes over intellectual property rights.
