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India and China Take Different Roads to World Leadership – Part I

Many anticipate China and India, with their rapid rise to power through globalization, to adopt global leadership roles. Yet expectations that either nation will lead the way in resolving global problems may be too high and too premature, suggests this YaleGlobal series. Historically a crossroads of culture, India adapts to globalization's modern forms, explains Shyam Saran, former foreign secretary for India, in the first of two articles. As economic power shifts to Asia, the emerging powers have divided interests, juggling rapid growth and large global footprints with pockets of devastating poverty. Emerging powers like India have made strides in leading the developing world, at times acting in their best interests to counter attempts by industrial powers to impose global initiatives. But in other respects, India remains a “premature power” unable to provide the expected leadership. Failure to balance both global and domestic interests would only diminish India’s leadership capabilities. – YaleGlobal

India and China Take Different Roads to World Leadership – Part I

An old master of globalization, India leads developing nations
Shyam Saran
YaleGlobal, 1 November 2010
A poster child: Despite globalization-led growth like a modern automobile factory (top), millions in India remain mired in poverty

NEW DELHI: Not so long ago India only evoked poverty and mysticism. Now the country’s name is invoked as a kind of poster child of globalization whose fast growth makes it a world leader. If the earlier view was oversimplified, so is the current one. 

The latest phase of globalization has certainly propelled India forward, but the nation is still far from assuming world responsibility that its economic advance seems to suggest. For all its progress, India remains a “premature power.”

Despite status as a poster-child of globalization, India is not a newcomer to the world scene. Always a crossroads culture, India has had a long history of global engagement. Throughout history it has influenced and in turn been influenced by other cultures. Its geographical position placed it at the intersection point of both major land and sea routes, whether it was the ancient Silk Road of caravans or trading ships following the monsoons both east and the west of the Indian Peninsula.

Not surprisingly, the average Indian considers engagement with the world a familiar activity. Indians are comfortable with other cultures and remarkably adaptable to different environments. Therefore, talking about India and the world should not imply that India’s interaction with the world, its embrace of globalization, is a departure from its history. Quite the contrary, India’s reintegration into the global economy is more the reassertion of a normal historical trend, not a departure. 

India’s reintegration into the global economy is more reassertion of a normal historical trend, not a departure.

Of course, contemporary globalization differs from historical versions. It is certainly larger in scope and geographical spread. It is more extensive and intensive. Between 1980 and 2002, it’s estimated that global trade volume tripled while global GDP doubled. Today global trade represents 35 percent of global GDP. In the decade between 1998 and 2008, global capital flows increased from about 5 percent of global GDP to nearly 17 percent. Therefore, India deals with a world far more interconnected and interdependent than ever before.

This has brought unprecedented prosperity but also many new challenges in its wake, including the erosion of traditional concepts of national sovereignty and territory-based state authority. Therefore, while India possesses the right genes to manage globalization, it must deal with a contemporary version unprecedented in scope and diversity of the challenges.

The current international landscape offer some clues to future trends: First, the world is no longer dominated by just one predominant power and an ascendant alliance headed by it. Now there is a cluster of major powers. The US remains, by far, the preeminent power and the ascendancy of the West continues. However, there has been, for some time, a trend towards the diffusion of economic power as well as political influence, steadily changing relative weights of different powers. Over the past two decades, in particular, the center of gravity of global economic power has shifted towards Asia – a consequence of sustained, accelerated economic growth in China, India and others in the region as well.

India must deal with
a contemporary version of globalization unprecedented in
scope and diversity
of challenges.

Therefore, in dealing with global and cross-cutting issues, such as energy security and climate change, food and water security, maritime security, international terrorism and drug-trafficking, dealing with pandemics and other public health issues, the active participation and cooperation of major emerging economies are indispensable.

Secondly, even though asymmetries in power distribution remain, the very nature of transnational issues makes it impossible for the strongest nation in the world, or a coalition of industrialized and developed countries, such as the G-8, to find solutions to global challenges. Global regimes to address such challenges can no longer be imposed on the rest of the world by the most powerful countries. If the emerging economies can’t always prevail in shaping the global arrangement in any particular area, they certainly enjoy the negative power to prevent such arrangements being imposed. This has been apparent at the stalled Doha trade round where collective opposition of the Group of 20 in which countries like India and Brazil played a key part in resisting pressure by developed nations to liberalize. It was in evidence at the Copenhagen Climate Conference, where again concerted opposition by developing countries blocked the European Union–led push to transfer burden of climate mitigation on poor nations. This may create the impression that emerging countries have been obstructive in international negotiations. Quite the contrary, they are now more effective in safeguarding their own perceived interests.

If the emerging economies can’t prevail in shaping the global arrangement of any particular area, they can prevent such arrangements being imposed.

The interests of premature powers, like India, differ from those of established powers. The hallmark of a “premature power” is that in overall GDP terms, in terms of share of global trade and investment and even absolute size of its professional and technical labor force, a country may have a large global footprint.

Nevertheless, in terms of domestic economic and social indices, it remains a developing country: Per capita income would be a fraction of a mature developed country and, though the country appears rich, it confronts major challenges of poverty, illiteracy, malnutrition and disease. This pattern of development differs from that of established industrial economies, where an increase in their share of the global cake went hand in hand with the steady improvement of individual and social welfare. Therefore, in playing a global role, emerging economies face an acute dichotomy – on one hand they are expected to take on greater responsibility and make a larger contribution to the management of what are called the “global commons.”

But at the same time, they continue to seek a global regime that can deliver the resources and instruments to tackle significant domestic challenges. Indian leaders confront this tension all the time. Finding the right balance between the demands of a global role and the imperatives of domestic challenges is never easy, but must be sought in every case.

Finding the right balance between the demands of a global role and domestic imperatives is never easy, but must be sought in every case.

One of India’s foreign-policy objectives has been to demand a place in decision-making councils of the world. The claim to a permanent seat on the UN Security Council or G-20 membership represents this aspect of India’s worldview. But there is the constant reminder – much of the influence wielded is because India can lead, shaping the attitudes and positions of a larger constituency of the developing countries. And of course, in terms of development challenges, India’s situation is not so different from countries emerging less quickly: India wishes to sit at the so-called “high table,” then misses the umbilical chord still connecting it to the constituency of the developing world.

India is drawn back into both conduct and rhetoric that the affluent find anachronistic. Grow up, they say; don’t forget you're in a different league. In some ways, yes; in other ways, no.

This dichotomy will confront India for several years to come. On each item of the global agenda, India must seek an item-specific balance, where its role as a global actor does not undermine its ability to deliver the basic development needs of millions of its citizens. The balance it seeks must of necessity remain relevant to their interests. Otherwise, India will not sustain its global role.

Shyam Saran is the former foreign secretary of India.

Rights:Copyright © 2010 Yale Center for the Study of Globalization

Comments on this Article

11 November 2010
This a thoughtful and nuanced article by Mr Saran. I would like to offer the comment that India's seeming "indecisiveness" in so many matters, whether foreign or domestic, are distilled in his article. He knows it better than most of us. But I would like to go a little further than Mr Saran.
I think India is not certain of its role in the modern world, and how to balance it with its own needs. This is just fine because the problems that India faces are difficult and complex problems. One possibility is to proceed only on self-interest. But given India's size and population, a narrow nationalistic view would be disastrous for the world. Another way is to remain engaged with the world in a positive way while its solves its problems. This requires consideration for others. Mr. Saran seems to be imply (and I hope he will pardon me for putting words in his mouth) that this balance is hard to find.
But in many ways his is a happy conclusion, because it leaves open the possibility that India can engage with the rest of the world in the best possible way. It can be sensitive to people everywhere while trying to help its own people out of poverty. It is not and should not be a zero-sum game. The best hopes for the future come when a large nation like India is mindful not just of it's own people, but it is mindful of people everywhere. When it is mindful of its responsibility to humanity at large. Otherwise it causes needless aggression. In this respect India need not be a "premature power", a "future power", or any power at all. It need not aspire to be anything. Except guaranteeing a measure of peace and prosperity for its people without grabbing from others in this world, and without trashing the environment.
This is idealistic, but I would like to return to Mr. Saran's observation that India was always engaged with the rest of the world in the past. And I would like to add that it was engaged in a largely peaceful way. So, the question is whether it can continue that engagement through modern times and into the future. I think it can. India will find its way, and hopefully it will be a humane and decent way. But it will be messy. It will make a lot of mistakes, it will be derided for not being sufficiently assertive, and it will remain indecisive. And it will never be a "superpower". But what is wrong with that? It will be India's way. It will be India's experiment. I for one am comfortable with it.
I look forward to Part II of the article.
-Rama Ratnam , San Antonio, Texas, USA
3 November 2010
This talk of China taking world leadership is laughable. China does not want to, does not need to, and is not qualified to take any world leadership. We earn an average of $3800 US a year and you $38000 US a year. We have no desire to lead anyone. You lead, please, we mind our own business.
(By the way, we have no comment on India. We do not appreciate the mindless comparison with India, please take it back to yourself. If you want to compare, do go ahead so with USA and India, such lofty titles like World's Greatest Democracy and World's Only Superpower. So sexy, let them take it; not us.)
-huyu , huyuhuyu