Recalibrating India’s Foreign Trade Policy


It’s time for India to reshape its narrative for the world and new paths for growth

India has finalized a trade engagement with the UAE with the formal agreement likely by the end of the month. This will give India better access for its food and dairy products in the Middle East while easing several restrictions on the movement of Indian professionals and students with relaxed visa standards. It would also allow India to have crucial access to the rich oil resources of the Gulf, thus adding job opportunities.

This follows India’s finalization of a similar trade deal with Australia, with an interim agreement in preparation for March 2022. Announced by Trade Minister Piyush Goyal and Australian Trade Minister Dan Tehan, it is likely to cover certain categories of mutually agreed goods. , services, customs clearance, barriers to market access, etc. This is a preview of the two countries’ stated end goal of signing a comprehensive economic cooperation agreement in about two years. Sectors that can reap profits include pharmaceuticals, healthcare, mining, education, renewable energy, gems and jewelry, defense and textiles. It also has the potential to increase Indian students’ access to Australian universities and vice versa, thus also opening up huge avenues for growth in the south.

Add to that Foreign Minister Jaishankar’s short three-day visit to Southeast Asia on his return trip from Australia to meet with senior leaders of the Philippines. Echoes of cooperation in areas of bilateral interest such as security, coordination in the Indo-Pacific belt, cooperation in healthcare, vaccine research, defense and maritime rights have also found resonance. echo in India’s engagements with the Philippines.

The backbone of all these activities lies in finding and strengthening alliance partners for a safe, secure, transparent and rules-based Indo-Pacific region. Global forces such as the United States and Europe are also recalibrating their diplomatic, defense and military forces to strike a fair balance in the region, which is threatened by an openly aggressive China. It should not be missed that in the examples of bilateral and plurilateral external engagements, India is aggressively trying to make deeper inroads into emerging dominant groupings.

After hesitating to commit to QUAD, India became deeply invested in playing with the group in several areas of mutual interest while carefully avoiding being drawn into defensive arrangements (like AUKUS). Similarly, India has made early progress in what many have called the Western QUAD made up of a large group of interested parties such as the United Arab Emirates, the United States and Israel.

This marks a shift in India’s foreign, trade and economic policy, which is rapidly changing to adapt to the new world order emerging post Covid. The world has realized that an overreliance on China for most manufacturing needs, including in critical sectors such as information and communication technology and pharmaceuticals, can be disastrous. Second, a global economy hammered by the pandemic and waiting to open up to tourism and new opportunities realizes that a diverse group of partners scattered across the globe is better cover. Third, the winds of change ushered in by the US withdrawal from Afghanistan and Russia’s show of military force on Ukraine’s borders, with the aim of reshaping European power structures, have left everyone looking resilient allies, instead of sticking to old intimate ideological friendships. This is also the time for India to reshape its narrative for the world and re-engage citizens on new paths of growth. It can be difficult to sell a nationalist foreign policy to an electorate, but, however, showing some benefits on the ground such as increased wealth and job opportunities, with an added bonus of chances to work abroad abroad, the national constituency can be managed.

(The author is a political analyst. Opinions expressed are personal.)


Comments are closed.