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Modinomics & Looking East

modi-sworn-in-600

27 May Modinomics & Looking East

With the Bharatiya Janata Party’s (BJP) landslide victory in the recent Indian elections, all eyes are now on the new Prime Minister, Narendra Modi, and how his government will handle India’s struggling economy.

Modi, a nationalist hardliner with a strong focus on spurring India’s economic growth, adopted the phrase “toilets before temples” as one of his campaign slogans, emphasising the need for the government to prioritise fundamental issues such as sanitation before religious efforts. Therein lies much of his appeal – his promises to spur economic growth and solve such issues, thus lifting the Indian populace out of poor living conditions and into the middle-class life, with a higher standard of living.

In much of his campaign, Modi held Gujarat, of which he was chief minister from 2001 to 2014, as an example for the rest of India. Gujarat’s per capita income, which tripled during Modi’s term in office, is a case in point of the success he hopes to bring to the nation. This was brought about by Modi’s focus on the free market, and placing priority on the private sector with less state intervention.

Challenges ahead

However, replicating Gujarat’s economic success across the country is not without challenges. Attempts to change laws and legislation require the cooperation of state governments, which could complicate matters.

Besides striving to revive India’s economy, Modi is also expected to tie it in with the nation’s foreign policy. Under his lead, India’s “Look East” policy, which seeks to boost India’s presence in the region, may see the nation forming closer ties with its Asian neighbours, particularly Japan. On top of the good relationship that Modi shares with Japanese Prime Minister Shinzo Abe, Japan is a key part of India’s strategic priorities, as both nations are concerned about a Sino-centric Asia.

In his tenure as Gujarat’s chief minister, Modi has visited China, Japan, and Singapore, underscoring the Asian focus of his foreign policy. However, he will have to reconcile the need for India to pursue its economic interests in China, and security concerns over China’s perceived expansionist mindset. Finding the balance between these two will be a key concern for Modi, who stated that it is possible for the two nations to take their relationship “to another level”.

Furthermore, Modi invited the leaders of the South Asian Association for Regional Cooperation countries to his swearing-in ceremony, perhaps signalling his intentions to strengthen ties with them. Notably, the attendance of Pakistan’s Prime Minister, Nawaz Sharif, suggests the possibility of an improvement of India-Pakistan relations. Modi also announced Sushma Swaraj as the new Minister of External Affairs, and it remains to be seen how Modi and Swaraj will shape India’s foreign policy.

Another concern over the BJP’s victory is whether we will see a resurgence of strong Hindu nationalism, and what that could entail for India’s Muslim population. Modi has been criticised for how he handled the 2002 anti-Muslim riots in Gujarat, and only time will tell how he will reconcile Hindu nationalism with Muslim concerns in years to come.

Sources:

A Modi Foreign Policy: The Knowns and Unknowns [Brookings, 16 May 2014]

The World of Narendra Abe
 [The Indian Express, 27 February 2014]

Should India really follow Modi’s ‘Gujarat model’? [The Conversation, 22 May 2014]

India’s Shinzo Abe [Project Syndicate, 16 May 2014]

Narendra Modi focuses foreign policy, invites SAARC leaders [The Economic Times, 26 May 2014]

PM Modi announces list of Cabinet ministers with portfolios [The Times of India, 26 May 2014]

Photo Credit: Narendra Modi, official Flickr account