Quad and an opportunity to define India’s economic policy

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During the last week of April, India, Japan and Australia officially launched the Supply Chain Resilience Initiative (SCRI) to build resilient supply chains in the Indo region. -pacific in order to reduce their dependence on China. This development takes place in the context of the Joe Biden administration, during its first 100 days, expanding the reach of the Quad grouping from a conventional security group limited to an economic size grouping through multiple trade initiatives. , aid and supply chain.

In March, President Biden hosted the first-ever Quad Summit with leaders from Japan, Australia and India, pledging to deliver one billion doses of the Covid-19 vaccine to Southeast Asia. South East. The main feature of this engagement was the division of roles – India will manufacture, Japan will finance, the United States will provide the technology, and Australia will contribute the logistics. This division of roles establishes a model for future economic cooperation among the quadruple nations and a model for India to define its economic status in the region.

Changing aid models

Economic policy is the use of economic means such as foreign aid, trade and commerce to achieve foreign policy objectives. Since India’s independence from British rule, India has benefited from this foreign aid and trade privileges. Although she continues to benefit from this aid and privileges, the size and scale of the aid received has declined significantly over the past 20 years (despite the current level of increased dependency due to the second wave of pandemic) and India has evolved. into a donor of medical aid and supplies.

In addition, he is no longer a mere spectator of world affairs, but an active participant, if not a leading voice on issues of global concern – pandemics, climate, terrorism and cybersecurity. As the second most populous country in the world with a talented labor pool, India can leverage the Quad Security Group to address its national security threats, especially China by using tools of economic government.

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China’s exponential rise and its use of its own economic policies to win friends in India’s neighborhood have the potential to turn into a perennial threat to national security. From the shores of Hambantota to the hills of Papua, China has successfully used its state-owned enterprises and development banks to provide aid, loans, and provide infrastructure to countries in South and Southeast Asia. as part of its flagship trillion dollar belt. and Road Initiative (BRI).

To give credit where it is due, India has reacted proactively by building its own connectivity programs across its eastern and northeastern states with initiatives such as the Bay of Bengal Initiative. for multisectoral technical and economic cooperation (BIMSTEC) and through maritime infrastructure initiatives such as the Sagar Mala project aimed at improving India’s logistics capacities.

However, as with any government project in India, the pace, scale and execution of these initiatives have been the main obstacles to mounting any form of meaningful challenge to the China-led Initiative. In order to meet the challenge of tackling Chinese state-owned enterprises, the Indian government should engage its vibrant private sector.

Quad and Indian industry

Prime Minister Narendra Modi has been a strong advocate for supporting enthusiastic leaders in India’s private sector. And in recent weeks, Indian industrialists have proven they can address government shortcomings and intervene in times of crisis by converting their industrial oxygen into supplies for those in need. Indian vaccine juggernauts play a role not only in inoculating the Indian population but also in achieving foreign policy goals by manufacturing for more than 70 countries including those in Southeast Asia as part of the Quad Initiative.

Read also | Quad an exclusive “ clique ”, working against China: Ministry of Foreign Affairs

In the past, India and Japan have worked together on projects in Sri Lanka, on development initiatives in northeast India, and the United States has been instrumental in establishing a coalition of nations to respond to China’s overtures in the Indo-Pacific region. The Gujarat-based Adani Group is involved in the Sri Lanka port project and is building the container terminal along the Yangon River in Myanmar. The New Delhi-based GMR is working on infrastructure projects in Nepal, Indonesia and the Philippines and Tata Group is engaged in several energy and infrastructure projects in Vietnam. While it is not new for quadruple nations to partner with infrastructure projects in the Indo-Pacific, a concerted effort on a much larger scale with the Indian private sector will prove to be an effective strategy for counter China’s foray into these markets.

Zaibatsu or Chaebols and not Oligopolies of the Soviet era

In 30 years, the East Asian economies of Japan, South Korea and Taiwan have successfully leveraged aid and their private companies to achieve their foreign policy goals. While the model could be emulated by India, the Modi administration in particular should tread the course with caution, already being accused by its critics of favoring a few conglomerates such as Adani Group and Reliance Industries. To avoid further criticism, the government should select companies that do not have heavily leveraged balance sheets and create a consortium of Indian Navratnas or best-run companies such as Larson & Tubro (L&T), Tata Power and Wipro, based in Chennai, to name just one. little.

Read also | Chinese company’s Covid-19 drug claims attract skepticism from scientists

India shaping its economic government using the Quad Security Consortium and its private sector will first, revive and support Indian infrastructure companies by providing the injection of much needed capital to undertake new projects that are to be capital intensive and also reduce their exposure to risk through the public-private sector. partnerships with Quad nations. Second, it will integrate India into the Asian trade architecture without having to engage in a China-centric trading bloc such as the Regional Comprehensive Economic Partnership. And third, it will pose a formidable challenge to the economic coercive acts of China’s Belt and Road Initiative in the Indo-Pacific region.

The actions taken by the Biden administration during its first 100 days in office allowed India to capitalize on its comparative geo-economic and geopolitical advantages in the Indo-Pacific region. There is perhaps no more opportune time and more strategically favorable region than the Indo-Pacific to shape its economic power.

Akhil Ramesh is a member of the Pacific Forum, United States

Opinions expressed are personal

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