Perspectives from ISB

Distinguished moderator, fellow panellists and friends,

I am delighted to be back at the ISB at the invitation of my friend, Kumara Guru. I enjoyed my last visit about four years ago and since then ISB seems to have grown in stature and size.

I must acknowledge the presence in the audience of General VK Singh, Minister of State for External Affairs, who inaugurated the Deccan Dialogue this morning. Very rarely do Ministers stay back to listen to others? They normally share their wisdom and leave as they are normally preoccupied with other engagements. Thank you, Sir, for staying back to listen to the panel.

I left the Indian Foreign Service 14 years ago after 37 years of an exciting journey and, therefore, mine will be a voice from the past in this dialogue. But in any dialogue, it is important to have a perspective from the past. I belong to the generation of Indian diplomats for whom geopolitics was the main staple of diplomacy. Of course, there were commercial and economic sections in our missions, but political work was at a premium. Economic and commercial work did not amount to more than reporting on the economic situation of the host country, bringing export opportunities for commodity boards and others, trade promotion and resolution of trade disputes. In my early years, we had nothing much to showcase except our traditional export items like handicrafts. The main attraction at Expo 70 in Osaka was a white tiger, in addition to sari-clad women serving Darjeeling tea. The bulk of the economic work was done by visiting delegations and the role of the missions was merely supportive. The Ministry of External Affairs itself had only a coordinating role as the nodal ministries dealt not only with policy but also negotiations. Even after an Economic Division was created, the MEA remained on the margins, while the nodal Ministries did not even report to the MEA, except in a routine manner.

Today, it appears to me as an outsider that India’s Economic Diplomacy has assumed multiple dimensions, as the world has changed and India’s priorities have changed. The new challenges have inevitably led to new institutional arrangements and machinery. Nehruvian foreign policy projected India’s interests as part of global peace and prosperity, particularly of the developing world. Decolonisation, disarmament, development and human rights, which India championed served India’s national interests, but, at the same time, secured India a leadership role among the newly independent developing nations. The same approach continued through decades with some modifications to make it pragmatic in a globalised world.

India today is more forthright in pursuing our national interests through selective alignments with countries and groups that serve our priorities, such as development, security, the neighbourhood and the diaspora. PM Narendra Modi himself is leading India’s economic diplomacy through selective interactions at the highest level around the globe. Hesitations of history and ideological inhibitions have been set aside to develop transactional arrangements with selected countries, based on India’s strengths, such as its growing economic power, availability of resources, particularly human, a stable Government and a strong leader. The pursuits like Make in India, Digital India etc have made India’s diplomacy primarily economic and the Ministry of External Affairs and our missions abroad have become crucial players. Turf battles may still be there, but the disruptive innovations have resulted in giving Indian diplomacy an economic face.

Economic diplomacy today does not confine itself to imports, exports, investments, markets etc. Intense competition among major countries has made it necessary to acquire new tools. Market access, for example, requires thorough knowledge of regulations in our target markets. Labour mobility is essential to continue to deploy our people in appropriate countries. Kerala would have submerged in the Arabian Sea if our people had not gone to the Gulf. Now we are happily submerged in Arabian money. Physical connectivity of the nature of China’s BRI will have to be built and access to big data only can get us access to best technology. Trade negotiations go beyond tariff and specialised knowledge is required on global priorities and practices. The increasing number of engineers and technologists joining the Foreign Service may help the transformation of the Service to reinvent itself to meet the economic challenges.

All that I have said should not detract from the importance of political diplomacy, particularly at the present time when the geopolitical situation is in a flux. For this reason, it is important for professional diplomats themselves to be practitioners of economic diplomacy, not specialists in specific areas. India’s achievements in the economic negotiations in multilateral bodies are a matter of pride. Operating within the G-77, India has accomplished much in WTO, IAEA and environmental negotiations. It was MEA, which led the climate change negotiations in the initial years with great success, though the Rio commitments were diluted beyond recognition in subsequent years. The renaissance in nuclear power for peaceful purposes before Fukushima was on account of the efforts of the developing countries, led by India. More than 40 developing countries were poised to develop nuclear power when the Fukushima disaster struck, forcing many nations to close their reactors.

India’s new priorities in foreign policy have given primacy to economic diplomacy with the Prime Minister himself taking the lead. The Prime Minister stressed the point by hugging Mark Zuckerberg and Sundar Pichai with the same ardour as he did Donald Trump and Benjamin Netanyahu. Against this backdrop, the Deccan Dialogue on Economic Diplomacy is all the more timely and relevant. I hope the dialogue will help all the dramatis personae, Ministers, diplomats, business leaders and others to sharpen their tools to practice economic diplomacy, including its manifestations like environmental diplomacy and water diplomacy.

Thank you,
T.P. Sreenivasan, (IFS 1967)
Former Ambassador of India and Governor for India of the IAEA
Chairman, Academic Council and Director, NSS Academy of Civil Services,
Director General, Kerala International Centre.
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