India elsewhere

From The Economist
An awkward neighbour in a troublesome neighbourhood

ON SEPTEMBER 26th Manmohan Singh expressed an unfashionable sentiment.
Addressing George Bush in Washington, DC, he said: “The people of
India deeply love you, and all that you have done to bring our two
countries closer to each other.” There is some evidence for this.
According to a survey by the Pew Research Centre in June, 55% of
Indians approved of Mr Bush. A big reason must be the nuclear deal
between India and America: it has moved India’s world.

It should provide India with some useful electricity. But the deal is
much more significant for the country as recognition of its growing
importance in the world. Even governments and commentators that
disliked it—and there were many in Europe, including this newspaper—
mostly agreed that the existing sanctions regime, which restricted
sales of nuclear fuel and technology to India, was outworn. Most
Indians considered the fact that the rich world was rewriting its
rules for India to be more pleasing than any detail of the deal.
Referring to its passage through the 45-nation Nuclear Suppliers Group
(NSG), the Times of India gushed: “If the Beijing Olympics was China’s
coming-out party, the NSG waiver was India’s.”

That was silly. But the deal has also generated enthusiasm abroad. In
his recent book, “Rivals”, Bill Emmott, a former editor of The
Economist, calls it Mr Bush’s “Richard Nixon moment”—in reference to
that American leader’s historic overture to China. It is safe to
assume, as Mr Emmott does, that Mr Bush’s fear of a rising China, and
his wish to bolster India against it, was the main motive for the
nuclear detente. But what sort of rising power is India?

On foreign policy, in which until recently India had little interest
outside South Asia, it is starting to look a bit like China. India’s
foreign service is still tiny, with around 600 diplomats. Its foreign
trade, though rapidly growing, is also still relatively small. But
India, like China, is increasingly writing foreign policy to meet its
economic needs: chiefly, access to natural resources and foreign
markets.

That was the message of a summit India held for 14 African leaders in
Delhi in April. A decade ago India’s two-way trade with Africa was
twice the size of China’s. It is now less than half the size, at
around $30 billion a year. But that inaugural India-Africa summit also
illustrated important differences from China in India’s approach to
building its economic ties. The summit in Delhi was dominated by
private companies, which are leading India’s overseas investments.
This helps to ensure that India escapes much of the opprobrium heaped
on China for consorting with dictators.

In fact, democratic India is often no more principled abroad than
communist China. It refuses, for example, to condemn brutish
governments in Myanmar, which has oil and gas that India needs, and in
Iran, with which it is negotiating to build a $7.5 billion gas
pipeline. Last year, in the thick of the nuclear-deal drama, America
urged India to rebuke Iran. In a public statement, India told America
to back off.

A messy part of the world
But India’s biggest foreign worries, as the Mumbai terrorist strike
has shown, are still in its messy region—especially Pakistan. In a
sign of an enduring preoccupation with their neighbour, many Indians
considered the nuclear deal most pleasing for having “de-hyphenated”
their country from it: that is, for making a distinction between the
world’s biggest democracy and the nuclear proliferators next door.
Speaking in a different tone, Pakistanis tend to agree: set against
India’s recent progress, their latest turmoil is humiliating.

India no longer exults, at least openly, in Pakistan’s problems; it
worries about them. That explains the carefulness of its post-Mumbai
message to its neighbour. India said that the terrorists were
Pakistani, but not that Pakistan’s government was behind them. It did
not threaten Pakistan with a military reprisal, as it has done after
previous terrorist attacks. Impressively, India apparently did not
consider withdrawing from a four-year diplomatic effort to “normalise”
its relations with Pakistan.

The process has been more or less stalled for over a year, mainly
because of political chaos in Pakistan. But India has also contributed
to the deadlock. In particular, it has seemed reluctant to settle the
rivals’ main dispute, on the status of the divided region of Kashmir.

India and Pakistan both claim all of Kashmir (though officially
Pakistan says Kashmiris must decide their fate), and have fought three
of their four wars over it. But both know that the current
arrangement, in which India has the rich valley of Kashmir and
Pakistan a poorer portion, is unlikely to change. Pervez Musharraf,
who resigned as Pakistan’s president in August, had therefore proposed
legitimising it. As a sop to Kashmiris, and to Pakistani pride, he
also suggested that the newly demarcated border in Kashmir should be a
soft one.

There is no better solution. But India did not trust Mr Musharraf, so
it dragged its heels. Mr Musharraf’s successor as president, Asif Ali
Zardari, has sounded even more accommodating to India: he has
described Islamist separatists in Kashmir, formerly backed by
Pakistan, as “terrorists”. But so long as Pakistan is as unstable as
it is currently, India will be unlikely to bite. Its latest attitude
of angry forbearance towards Pakistan is, for now, probably as much
peace as can be hoped for.

As a neighbour, India is itself far from ideal. It has a long history
of meddling in other countries’ politics, including Pakistan’s. Nepal
witnessed an embarrassing example of this in April, when India had its
paw-prints all over the country’s first proper election in a decade.
Seeking to secure a pliable new government, its agents bribed and
divided the field; this almost certainly helped a party of Maoist
guerrillas, whom India disliked most, to a stunning victory.

Subcontinental hopes
Bangladesh, a semi-hostile nation of 153m delta-dwellers, which is
currently under military rule and often under water, is another worry.
Illegal Bangladeshi migrants are already sparking conflict in India’s
north-eastern state of Assam. As the seas rise, the UN’s
Intergovernmental Panel on Climate Change calculates that another 35m
will have crossed into India by 2050. If only to manage climate-
induced problems, South Asian countries have got to co-operate better.

Mr Singh’s answer, to start by boosting regional trade, is the best
there is. His vision is “to have breakfast in Amritsar, lunch in
Lahore and dinner in Kabul”. (And wake up in hospital, diplomats
josh.) But there is a way to go. According to a World Bank report
released last year, South Asia is the least integrated region in the
world. Trade between its members accounted for less than 2% of their
combined GDP. In East Asia the figure was 20%.

From this tiny base, there is at least a promise of an advance. A
regional free-trade scheme came into effect in July 2006, though its
progress has been painfully slow. Meanwhile, two-way trade between
India and Sri Lanka, which signed a bilateral free-trade agreement in
1999, is ballooning. More important, as a measure of the bilateral
relationship that India is starting to worry about most, two-way trade
between India and China is climbing: from $4.8 billion in 2002 to $38
billion last year.

That is still modest: China’s trade with South Korea is worth four
times more. But it is an encouraging basis for a relationship between
two giant countries that fought a border war in 1962 and still claim
portions of each other’s territory. Those disputes continue to fester;
last month Chinese officials reasserted China’s claim to India’s
entire north-eastern state of Arunachal Pradesh. Indian strategic
thinkers, who tend to be of a traditional bent, like to speculate
about the circumstances that could drive India and China to conflict.

This is bold thinking: India’s armed forces are, like its economic
progress, at least a decade behind China’s. India’s defence spending
is also less than half China’s. But India does have an advantage over
its giant neighbour in the way much of the world perceives it: as well-
intentioned and democratic, maybe chaotic—but not inscrutable and
possibly malign.

Difficult, and proud of it
That should be a big advantage for India. Indeed the nuclear deal is
testimony to it. But India does not often return the world’s
compliments. It demands, and increasingly gets, a seat at the world
table, but its table manners are sometimes regrettable. In
international negotiations, on trade and climate change, India has a
habit of obstructionism, in which it takes unseemly pride.

China has profited from this. At the most recent Doha-round
negotiations at the World Trade Organisation in July, for example, a
deal was blocked by India, China and America. But unlike its fellow
protectionists, India seemed keen to take responsibility for this
failure. Its obstreperous chief negotiator, Kamal Nath, was garlanded
on his return to India—for having defied the Western imperialists.
That sort of nonsense might play well with Indian voters, but it is
bad for India’s reputation abroad.

source: http://www.economist.com/surveys/displaystory.cfm?story_id=12749743&f...