Content:
- India’s choices in a world becoming bipolar again
- Essential business priorities in a changing world
India’s Choices In A World Becoming Bipolar Again
Context:
The world is moving towards a new kind of rivalry between the U.S. and China, where both are deeply economically interconnected. In this dynamic landscape, especially after the recent BRICS meeting, India must carefully choose its path. The choices India makes now will shape its role in the Indo-Pacific, balancing its sovereignty, security, and influence.
Relevance: GS2 (International Relations)
Practice question: “What strategic challenges does India face in the U.S.-China bipolar world, and how can it maintain autonomy while fostering Indo-Pacific partnerships?” (250 words )
Emerging bipolarity :
This bipolarity is different from U.S.-USSR. During the Cold War, the U.S. and the USSR were disconnected economically and ideologically. But in the current evolving bipolarity, the US and China are interconnected in multiple factors, i,e “Competitive coexistence”, and the American approach changed to “De-risking” from “De-coupling”.
- The U.S. is the largest investor in China.
- China is visited by more U.S. travellers than any other Asian country.
e.g.On average, over 2.5 million Americans visit China each year
- China owns the highest treasury bonds than any other country.
e.g.As of May 2024, China holds $768 billion in U.S. Treasury securities
- China is the key supply chain provider for the U.S.
- China is challenging the US, In new technologies like 5g.
- US – USSR had similar military strength. But in the current scenario, China has more battleships than the US, in many areas, it matches the US, and in many, it even exceeds it.
Example: China has over 350 vessels compared to the U.S.’s, approximately 293.
Shift from Ideology to Power
- Cold War Ideology: The U.S.-Soviet rivalry was about capitalism vs. communism.
- Sino-American Competition: U.S.-China rivalry is not ideological but about global dominance.
- U.S. Democracy vs. Autocracy Framing: Since 2021, the U.S. has framed rivalry as democracy vs. autocracy, but this narrative has limited global response.
China’s Focus on Global Power
- Non-Ideological Approach: Critiques Western democracy and focuses on economic and military dominance.
- Global Role: Uses initiatives like the Belt and Road Initiative (BRI) to expand influence driven by self-interest.
Russia’s Role in the New Bipolarity
- Junior Partner: Influential due to natural resources, nuclear arsenal, and historical ties.
- China-Russia Axis: Aligning with China, despite economic and military lag, poses geopolitical challenges.
- Challenges: Russia supports China in global conflicts, aligning interests in regions like Taiwan and the South China Sea.
Emerging Nexus of Anti-Western Powers
- China’s Clients, Not Allies: The network includes Russia, North Korea, and Iran, challenging Western dominance.
- Potential Geopolitical Hotspots: The emerging bloc could impact areas like the South China Sea and Taiwan, affecting global stability.
India’s Strategic Position in the Indo-Pacific.
India is central to the Sino-American competition in the Indo-Pacific region, with strategic partnerships like Quad (India, U.S., Japan, Australia), and India being the only Quad member sharing a land border with China with Line of Actual Control (LAC), a key focus.
Challenges for India:
China’s Aggression and Security Threats :
- 2020 Galwan Clash: Resulted in the deaths of 20 Indian soldiers, underscoring the need for military preparedness.
Economic Relations with China :
- Trade: In fiscal year 2023-24, bilateral trade reached $118.4 billion.
- Trade Deficit: Surpassed $100 billion in 2022, highlighting economic dependency.
Technology and Defence Ties with the U.S.
- Defence Technology and Trade Initiative (DTTI): Enhances defence cooperation.
- Joint Exercises: Strengthen India’s military capabilities.
- Strategic Autonomy: Balancing close U.S. ties with independent defence policies.
Strategic Autonomy:
- Non-Alignment 2.0: India should maintain a modern form of non-alignment, engaging with both the U.S. and China without aligning too closely with either.
- Multi-alignment: Building strong partnerships with countries like Japan, Australia, ASEAN, and regional neighbours can help India avoid over-reliance on any single power.
India’s Self-Reliance:
- Atmanirbhar Bharat: By strengthening domestic industries, especially in defence, technology, and manufacturing, India can reduce dependency and increase resilience in global geopolitics.
Focus on Regional Leadership :
- South Asia and Indo-Pacific: India can position itself as a regional leader, building strong ties with ASEAN, smaller South Asian nations, and other Indo-Pacific players to counterbalance China’s influence.
Balancing Sovereignty and Global Engagement :
- Sovereignty Protection: India must safeguard its territorial integrity, especially along the border with China, while using diplomacy to avoid unnecessary conflict.
- Economic and Diplomatic Interests: Pursuing its geopolitical and economic interests through strategic partnerships will help India enhance ties with both global and regional powers.
Conclusion :
The U.S.-China rivalry is about geopolitical power, not ideology, with Russia playing a key but secondary role. This multipolar world presents complex challenges for India, requiring careful navigation of alliances and conflicts to maintain its sovereignty and influence.
Essential Business Priorities in a Changing World
Context:
Over the past few years, the global economy has been stabilising from all the shocks, especially the pandemic one; though there is growing concern over geopolitical risks, the economy is getting back to normal stage. The B-20 process must focus on inclusive growth, sustainability, and ethical governance to address the scenario effectively.
Relevance: GS3 (Economy )
Practice question: What are the key business priorities from the B-20 process related to inclusive growth, sustainability, and ethical governance? How can businesses benefit from opportunities in Africa? (250 words )
Uneven recovery rates :
The G-20 nations are experiencing different growth rates, indicating uneven recovery patterns. This scenario demands customised economic strategies to address the challenges of both advanced and emerging economies.
Emerging Opportunities and B-20 Process:
- The Business 20 (B20) is the official G20 dialogue forum with the global business community. Established in 2010, it represents the voice of businesses within the G20, an intergovernmental forum of the world’s major economies. The current B20 summit will be held in São Paulo, Brazil, 24th October 2024.
- The leadership of B-20 has shifted to emerging economies for the past three years. South Africa’s upcoming presidency(2025) focuses on the Global South agenda.
Focus on Inclusive Development:
Equitable growth is the key focus of B-20; strategies include:
- Skill Development: Businesses should invest in training programs, especially for women.
- For example: On-the-job training, working with academic institutions and developing curricula that meet industry demands.
- Financial Access: Tailored credit solutions are crucial.
- For example:With over 530 million accounts, India’s Jan Dhan Yojana is a successful model.
- Africa’s G20 inclusion: The expansion of footprints in Africa has paved the way for great market potential, integration of Africa into the global value chain and emphasis on sustainable development
Ensuring Food Security:
- The promotion of sustainable food systems is critical to tackling global food crises posed by climate change and supply chain shocks.
- Leverage technology in agriculture, e.g., precision farming, and collaborate with governments for improved food access, e.g., Public distribution system.
Strengthening Global Trade Flows:
- Address rising tariffs due to national security concerns and protectionist policies.
- strengthening the WTO to counter unfair trade practices.
- Establish clear environmental taxonomies to support sustainable and smooth trade policies.
Digital Transformation and Innovation:
- Businesses must promote responsible use of technologies like AI for societal benefit.
- Engaging youth in developing innovative solutions for global challenges.
Commitment to Sustainability:
- Align business practices with net-zero targets through the promotion of renewable energy and sustainable practices.
- Supporting small and medium enterprises in achieving sustainability goals through financing and technology support.
Corporate Governance and Ethical Standards:
- Emphasise high standards of corporate governance to build stakeholder trust.
- Businesses must go beyond compliance for the creation of a conducive environment.
Role of the B20 Global Institute:
- The B20 Global Institute was established during India’s leadership of B20. The institute aims to maintain policy alignment across G-20 nations.
- Focus on facilitating business competitiveness and monitoring outcomes of implemented recommendations.
Conclusion:
Global businesses play a crucial role in addressing economic challenges.Prioritising inclusive growth , sustainability, and governance can drive meaningful change and achieve global aspirations.
