From chanakya to modi evolution of india’s foreign policy

part of a compromise. An Indian diplomat remarked to this author in an
interview that India needed to do things not simply because they were
beneficial to India but because it was the right thing to do. Thus,
compromises for self-interest are often looked down upon, and when they
are made, a veneer of high-minded principle is maintained.
While India aspires for global great power status, in its immediate
neighbourhood it already considers itself one. India’s immediate
neighbourhood – South Asia – is India’s backyard where it does not like the
interference of other major powers. The greater neighbourhood, extending
from the Gulf to South-East Asia, is also part of India’s sphere of influence,
and developments in the region are deemed critical to India’s foreign and
security policy. As President Pranab Mukherjee observed in his annual
address to the joint session of parliament in 2013, India seeks ‘peace,
stability, cooperation and economic development’ in South Asia and
attaches ‘the highest priority to relations with our immediate neighbours’.
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The South Asian region has always received the greatest attention from the
makers of Indian foreign policy. At Independence, India inherited borders
or imperial fault lines that have impacted ties with all its neighbours. India
is the largest and most populous country in South Asia, with the largest
economy and the biggest armed forces. This threatens some neighbours and
overwhelms others. India is also the only country in the region that shares
land or sea borders with other member states of the South Asian
Association for Regional Cooperation (SAARC), with the exception of
Afghanistan.
India is sometimes described as the region’s ‘big brother’ with whom
several neighbours have border disagreements. Some of India’s
neighbouring states were once part of an Indian Empire while others
emerged as separate kingdoms within a vast Indian civilization. India is the
geographical, sociocultural and economic centre of South Asia and, in the
words of former diplomat S.D. Muni, India’s centricity in the region is
because ‘there is a bit of India in every other country of South Asia’.
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As is
often the case involving smaller neighbours of a large country, it is easy to
fuel resentment or fear of domination among India’s neighbours.
Concerns of neighbours notwithstanding, India has not pursued a
hegemonic or expansionist policy under any government or leader. Some
leaders have sought unequivocal peace with neighbours (e.g. the Gujral
doctrine) while others have sought amity based on reciprocity or quid pro
quo (e.g. the Indira doctrine). None, however, have sought to take over
neighbours’ territory. That has not deterred India’s neighbours from
viewing India as hegemonic or imperialist. Over time, such views have
diminished among most of India’s neighbours with the exception of
Pakistan, which continues to suspect India of wanting to dominate South
Asia. Islamist ideologues in Pakistan go so far as to allege that India’s real
ambition is to recreate a Brahmin empire across the subcontinent.

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Ironically, it is not the ancient Hindu empires that inspire India’s view of
its immediate neighbourhood. Modern India’s perception of its environs
originates from the days of the British Raj. Different Indian leaders have
seen the region stretching from the Gulf to South-East Asia as important to
India, just as the officials of the Raj saw it, albeit with a different focus. For
the British, India was the nucleus of an overseas empire, a base from which
they could rule, control and defend lands distant from the British homeland.
After Independence, Nehru focused on Asia where he sought to act as
leader of a vast continent that was just emerging from Western colonial rule.
He did not think in security terms, at least until the war with China in 1962.
In Nehru’s view, bilateral treaties of friendship and peace with the three
northern Himalayan kingdoms – Bhutan, Nepal and Sikkim – and an offer
of a no-war pact to Pakistan
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was enough to deal with South Asia, freeing
him to seek prominence on the Asian and global stage.
The notion of the subcontinent as India’s backyard attained centrality
under Indira Gandhi. Under her leadership, India’s goal in its immediate
vicinity was no longer simply to protect India’s security and strategic
interests; India would henceforth also be interested in any incidents in the
neighbourhood that had or could have an impact on India. The Indira
doctrine was a South Asian version of America’s well known Monroe
doctrine. As writer Ashok Kapur states, Indian leaders, beginning with
Indira, wanted India to be ‘the only security manager in South Asia’ and
sought to reduce the role of external actors – primarily the United States
and the Soviet Union – and their ability to influence regional politics ‘to a
level of economic and technological assistance that would not encourage
Pakistan to pursue its irredentist claims.’
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India was not always able to
achieve this policy as Pakistan continually sought parity with its larger
neighbour, drawing the United States into the region as its ally.
21
Under Indira, India sought acknowledgement as South Asia’s pre-
eminent power, was willing to flex its muscle to assert its pre-eminence and

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did not want outside powers to involve themselves in the region’s affairs
without India’s approval. The Indira doctrine manifested itself most
prominently when, in 1971, India protested against the suppression of
democracy in East Pakistan and went to war to prevent the genocide of
Bengalis by the Pakistan Army. After assisting in the birth of Bangladesh,
Indira withdrew Indian troops from erstwhile East Pakistan to show that
India’s assertion of power did not amount to coveting other people’s
territory.
India’s desire to be the only major power in South Asia has not always
been successful, partly because India could not step in with economic
assistance or military hardware whenever its neighbours needed them.
Managing a sphere of influence is not only a function of telling others what
to do but being able to expend resources that deny space to competitors.
Even Bangladesh, which attained independence with India’s help,
eventually had to turn to the United States and China for economic support
because India alone could not bear the cost of its development. India’s
attempts in recent years to keep China’s influence out of its periphery have
not succeeded for similar reasons.
More recently, India has tried to use economic diplomacy to build better
ties with its neighbours. It has offered trade concessions, such as zero tariff
or removing non-tariff barriers, and concessional loans and credit to
Afghanistan, Bangladesh, Sri Lanka and Nepal, primarily with geopolitical
motives. Such initiatives have become possible because of India’s economic
growth. Any loss that India incurs in trade, lending or investment is deemed
bearable as long as it leads India’s neighbours to uphold India’s security
interests.
AUTARKY AND MULTILATERALISM
India’s economic expansion has enabled India to deploy economic tools in
managing national security and maintaining international influence. Major

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nations now look at India as a trading partner, destination or source of
investment and as a market for their own products. It was not, however,
always the case that India could use economic clout in the conduct of
foreign policy.
For years, India’s leaders and Indian governments did not accord
economic foreign policy the same priority as security policy. The Indian
Foreign Service, in its training and functions, traditionally treated economic
matters as falling outside their essential role. Trade and commerce was a
subject for consular officials, not for India’s diplomats. As early as 1947, an
Economic Affairs Division was created in the Ministry of External Affairs
only to be abolished in 1950. Later, in 1961, that division was revived as
the Economic and Coordination Division under a Joint Secretary.
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This reluctance to undertake economic diplomacy led to an interesting
phenomenon in India’s economic foreign policy: the role of business
organizations like the Federation of Indian Chambers of Commerce and
Industry (FICCI), the Associated Chambers of Commerce of India
(ASSOCHAM) and the Confederation of Indian Industry (CII). Even before
Independence, business groups started playing a critical role in India’s
external relations insofar as economic matters were concerned. Over the
years, both diplomats and economic specialists have had to deal with
economic issues, including trade with other countries, aid that India
receives, foreign investment, relations with international economic
institutions like the IMF, World Bank and Asian Development Bank, and
finally with aid that India has started providing other developing countries.
India has also taken its time in figuring out its place in the global
economy. Nehru and Indira spoke of changing the global economic order
but through diplomatic means and through participation in organizations
like the Non-Aligned Movement and the United Nations. Instead of
building India’s economic muscle under the existing rules of the game, they
hoped that India could lead other poorer nations in demanding changes to

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the structure of the global economy. This, in turn, was supposed to raise
India’s weight in world affairs and also strengthen its economy. It is only
from Rajiv Gandhi onwards that Indian leaders truly understood the
dynamics of global economics. India’s leaders now are well aware of the
rise of China – which has built its international stature by enhancing its
economic power.
According to Mansingh, India tried initially to achieve economic self-
reliance by seeking three goals: concessional development assistance,
diversification of trading partners and changing the international economic
order.
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The first would help India follow its own independent policies
without being accountable to others. This tied into both non-alignment as
well as the desire to avoid being part of any system or bloc. India sought aid
from international organizations like the World Bank, International
Monetary Fund (IMF) and even from the Aid India Consortium, viewing
them as multilateral donors offering assistance with no strings attached.
By having several trading partners, India wanted to make sure that it had
its eggs in many baskets and was not dependent on just one buyer or
supplier. The belief that the international system was skewed in favour of
the superpowers and discriminated against developing countries like India
led to the desire to change the world order. India has frequently called for a
new international economic order, for reform of the IMF and the World
Bank and even for reform of the UN Security Council.
The Nehruvian approach to economics as well as economic diplomacy
did not serve India well. Sumit Ganguly and Manjeet Pardesi point out that,
‘The failure to develop ties with the global economy contributed to a
paucity of foreign investment, important technological lags, a lack of
innovation, and the stifling of entrepreneurship. In turn, these forces
contributed to what the eminent Indian economist Raj Krishna mordantly
referred to as the “Hindu rate of growth”.’
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Immediately after Independence, the emphasis on economic autarky or
self-sufficiency made it a concern of domestic, not foreign, policy. Self-
reliance was seen as critical to ensuring India’s independence and even now
the fear of the East India Company’s legacy is so deep-rooted that most
Indian leaders would rather India not be dependent on any country. This
desire has always conflicted with reality. India does not produce everything
it needs and is one of the leading importers of oil and gas and defence
equipment. According to data compiled by the US Energy Information
Administration (EIA), India imports approximately 4.3 million barrels of
crude oil per day and by 2040 it will need ten million barrels of oil per
day.
25
According to data on international arms transfers published by
Stockholm International Peace Research Institute (SIPRI), between 2010
and 2014 India accounted for 15 per cent of the volume of global arms
imports, more than three times as much as China. This was up from the
period between 2005 and 2009 when India accounted for 7 per cent of
global arms imports.
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India also requires large doses of foreign investment
and access to the latest foreign technologies.
India resolved its dilemma of wanting autarky while needing external
support with sometimes contradictory policies and even hypocritical
practices. For example, foreign aid and investment are described as
impinging on India’s independence but that has not prevented successive
governments from accepting both. In effect, self-sufficiency has been the
aspiration even as pragmatic compromise has led Indians to get what they
can from whatever source will let them have it. In the policy realm, the
aspiration finds reflection in programmes such as ‘import substitution’ that
India adopted in its initial years and the ‘Make in India’ slogan of India’s
current prime minister, Narendra Modi. In practice, however, exceptions
and adjustments rule the roost and India has neither closed itself from the
global economy nor refused to let principle come in the way of its
immediate needs.

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A major example of practicality in India’s economic approach lies in the
adjustments made over time to the country’s agriculture policy. During the
1950s and 1960s India’s wheat production was insufficient to meet
domestic demand. India accepted US wheat under the PL-480 program,
which allowed India to pay for wheat in local currency. The arrangement
was useful because India had limited foreign exchange availability and
wheat purchases would have depleted these further. US president Lyndon
Johnson decided to slow shipments of wheat to India under PL-480 in what
he regarded as an effort to end Indian complacency about improving wheat
yields. The US would release wheat shipments only at the last minute in
what came to be known as the ‘ship to mouth’ scheme.
Even though Johnson’s intent was to force a positive change in Indian
policy, India under Indira saw it as undue pressure. India started importing
wheat from Mexico, considering purchase from a fellow developing
country as preferable to an overbearing superpower’s aid. India eventually
improved its wheat yields, albeit with US assistance in the form of high-
yielding variety of seeds and other technical inputs. That goal, however,
was achieved only after a mix and match of approaches that included
pursuit of autarky through external assistance. More recently, the
controversy in India over the use of genetically modified (GM) foods has
more to do with the desire not to be dependent on foreign seeds and to
produce home-grown food.
Another example of India’s aspiration for self-sufficiency can be found in
the constant tension between India and the World Trade Organization
(WTO) over trade issues. When India first joined the WTO, it sought an
exception under the Trade Related Intellectual Property Rights (TRIPs)
rules. Western countries granted ‘product patents’ on new inventions, which
precluded the manufacture of a patented product by whatever means
without permission of the patent holder. India, since 1970, started granting
‘process patents’, that allowed another inventor or manufacturer to make an

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already patented product as long as it was created by a novel process. The
‘process patent’ only recognized the uniqueness of the process of
manufacturing, not the uniqueness of the end product. ‘In pharmaceuticals,’
the