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The Indian Budget 2018: The Good, the Bad and the Ugly

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It won’t be a hyperbole to call the preparation of the Indian Budget the world’s toughest tightrope balancing act. In a country of 1.3 billion Indians, a gazillion sects and a country where the dialect changes every 20 kilometers, the Indian Budget is a unique unifying factor. Sitting in a small office, a select group of individuals charts the course of the Indian economy, soon to be the world’s fifth largest. A multitude of Intelligence and Security agencies are tasked to ensure that the Budget remains a secret before it is presented and the markets wait with a bated breath to gauge the winds that will blow with the onset of the Indian Budget. These winds can help the markets move at roaring speeds or topple the very applecart of their existence.

The Narendra Modi led National Democratic Alliance presented it final full Budget on Feb. 1, 2018. With elections due in eight states and the coming of the all-India General Elections, this budget was a final attempt by Modi to deliver on his promise of “Ache Din” (Good Days). But did he? Large sections of India is now restless. Farmers are suffering from a lack of good prices and mounting agricultural loans. Youth is suffering for the want of jobs. Businesses are under stress due to a new tax regime that they are yet to understand and comprehend. The Indian Middle class, BJP’s strongest supporters and among the minuscule few who actually pay a direct tax is reeling under high taxes. This was the last grab attempt to placate these sections and retain power for another five years. But what did it deliver? Sure enough, the budget contains a slew of measures for the agriculture and rural sectors, a new health insurance scheme has been announced for the poor and a small relief in income tax for the salaried class and senior citizens.

Let’s take a closer look at the Indian budget and break out the good, the bad and the ugly.

The Good

To placate the Farmers who have been protesting across the length and the breadth of the country, this budget promises to raise the minimum price offered to farmers for their crops. Stating that the focus of the government in the coming fiscal would be agriculture and rural India, the finance minister has announced that all Kharif crops will be paid a minimum support price (MSP) that is 50 percent more than the cost of production. It has also identified a need to invest heavily in the agricultural markets across India. It has also earmarked more money for rural areas, including that for irrigation projects and for aquaculture projects. The Kisan credit card will be extended to fisheries and animal husbandry farmers while Rs 2,000 crore provided for the development of agriculture market. The central budget directs state governments to purchase extra solar power generated by farmers using solar-powered pumps who have become cheaper after this budget.  The credit to agriculture would be raised to Rs 11 lakh crore in the coming fiscal from Rs 10 lakh crore. The budget provides for a 100 percent tax deduction for farm producer firms with Rs 100 crore turnover. There is a special impetus to promote “Operation Green”. In total, there has been a record allocation of Rs. 14.34 lakh crores for the agriculture sector.

In a bid to provide universal healthcare, the Budget announces a ‘National Health Protection scheme’ to provide health cover of up to Rs 5 lakh to each of the 10 crore poor families per year. Under the Aayushman Bharat programme, a total of 1.5 lakh centers will be set up to provide health facilities closer to the homes for which an outlay of Rs 1,200 crore to be allocated. A total of Rs 600 crore have been allocated for tuberculosis patients who will be provided with a grant at the rate Rs 500 per month during the course of their treatment. There are plans to set up 24 new medical colleges and hospitals by upgrading district level ones.  The budget lists that the PM JivanBimaYojana has benefited 5.22 crore families with more in the pipeline. And here we were really thinking that Obama-care was game changing?  Apart from all these announcements, the Budget contains a slew of announcements for the senior citizens of the nation like Incentives for Senior citizens like exemptions in income of Rs 10,000 from Banks FD and post offices and Rs 50,000 per annum exemption for medical insurance under Sec 80D.

With the finance minister promising a record infrastructure spending on roads and railways, construction and engineering firms, as well as train wagon-producers, could benefit. There is a plan to expand airport handling capacity by five times to handle 1 billion trips a year. It is estimated that Rs 50 lakh crore is needed for infrastructure building and the government will allocate Rs 7,140 crore for the textiles sector in next year.  National highways exceeding 9,000-km will be completed in 2018-19 and allocation of over Rs 1.48 lakh crore has been planned for railways. Regional air connectivity scheme shall connect 56 unserved airports and 31 unserved helipads for better connected and a closer India.

For the rural economy, the budget contains a slew of announcements. 8 crore poor women will get new LPG connections. Under the Prime Minister’s SaubhagyaYojana, it is estimated that 4 crore poor people will get power connection. A total spending estimate for this scheme is Rs 16,000 crore. Under the Swach Bharat Mission, the Government plans to construct 2 crore toilets in the next fiscal year. The government has set an ambitious target to provide a house for all by 2022. A total of 1 crore houses are to be built under Pradhan MantriAwasYojana in the rural areas. The Government will expand the PM Jan DhanYojana. All 16 crore accounts will be included under micro insurance and pension schemes for better returns and social outreach.

To formalize the economy, the Employees Provident Fund Act will be amended to reduce the contribution of women to 8 percent from 12 percent for first three years, with no change in employer’s contribution. The government will contribute 12 per cent of wages of new employees in EPF for all sectors for the next 3 years. The target for loan disbursement under Mudra scheme has been set at Rs 3 lakh crore for next fiscal.

The Bad

The government has extended Corporate Tax of 25% to companies with turnover up to Rs 250 cr in the financial year 2016-17. For a party always under a perception of being a corporate front, this will not go down well in the eyes of the media and the party will have a wild time dousing the flames. Also, 100% tax deduction is allowed to co-operative societies, the majority of whom have cooked books and shady members.

The long-term capital gains will now be taxed at a rate of 10% if exceeding Rs 1 lakh. The Education cess increased to 4% from 3% to collect additional Rs 11,000 crore but in turn, has put an additional burden on the tax paying middle class. The government’s decision to impose long-term capital gains tax on equity investments may dent investor sentiment for financial services companies, life insurers and providers of mutual fund products.

The Indian Defense Budget, while increased contains no clear roadmap to make India a manufacturing powerhouse and increase our armament production. Barely spending money is not good and while the outlays are increasing continuously, it is no secret that our outlay is minuscule in comparison to our GDP. Furthermore, most of the current budget is spent on personnel and maintenance costs, leaving very little for capital acquisition.  There is a serious need to quantify the defense budget and earmark separate funds for the capital acquisition.

The Ugly

Apart from a few scraps here and there like Rs 40,000 standard deduction, Mr. Modi has completely ignored the honest Indian Direct Taxpayer. A resentment is now brewing in this segment which has honestly been paying to tax and has time and again got pinched by every budget. In a nation where barely, 1.9% of the populations pays any tax, the honest Indian Taxpayer has become a minority of sorts, exploited and with no one to raise a voice for it. Hopefully, Modi can mollify this before the General Elections or all hell will break loose.

Conclusion

To conclude, the Indian Budget is prudent, not populist. The Indian Government deserves full credit for bringing out such a balanced budget so close to the General Elections. The fiscal prudence of this government has been lauded by international agencies and the recent budget is in line with the attempt of the government’s fiscal consolidation path. The Finance minister has set the fiscal deficit for 2019/19 (April-March) at 3.3 percent of the gross domestic product, slightly higher than expectations for 3.2 percent. Altogether, the budget has focused more “investments” than one-time hangouts. However, the devil lies in the details. There is a pertinent need for faster and smoother implementation.  The infrastructure projects will generate more jobs and ultimately, more usable projects on completion. R&D will generate more output for this nation. The government is ably trying to focus on both the “Ease of Doing Business” and the “Ease of Living”. Elections are upon the present dispensation and the Government must now focus on the implementation. If the 2014 election was about Ache Din, 2019 (or 2018) will be about the poor. The buildup initiated with the Jan Dhan and theUjwala Yojana, continued with the PAHAL andSaubhagyaYojana and now the AyushmanYojana and this Budget. The ingredients are all there. It now up to the chef Modi to cook his broth. But will his broth taste like sweet victory or a bitter-sweet defeat. This only time, and the Indian Rural Voter will tell.

South Asia

Why India won’t intervene militarily in Maldives

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An Indian Ocean archipelago of 1,192 islands, the Maldives is a tourist paradise. The Maldives is a low-lying country that is expected to be among the first in the world to go under water as a result of climate change. While it may take a few more decades for rising sea levels to wreak havoc on the archipelago, there are more immediate and pressing problems tearing the country apart.

Tourism is the backbone of the country’s economy, and tour operators have reported hundreds of daily cancellations since the state of emergency was imposed on February 5. Following the state of emergency, Maldives has been in a tensed state of existence in as the archipelago is facing a sort of turmoil, ransacking its tourism based economy.

Crisis

The current crisis was the result of a Supreme Court ruling on February 1, overturning the convictions of Yameen’s rivals. In addition to ordering the government to release the nine convicted opposition leaders, the apex court called for reinstating 12 parliamentarians who were stripped of their seats last year when they left Yameen’s Progressive Party of Maldives to join the opposition.

Two weeks after the government of the Maldives declared a state of emergency amid rising political tension, on February 20th Parliament approved a 30-day extension that, among other grave consequences, may result in serious damages to the economy, scaring away international visitors. On February 20, President Abdulla Yameen Abdul Gayoom requested to extend the Maldives state of emergency for a total of 45 days. The Maldives government and the Ministry of Tourism have emphasized their commitment to safety for civilians and tourists alike.

The emergency “shall only apply to those alleged to have carried out illegal activities — it shall not apply to otherwise law-abiding residents of, or visitors to, the Maldives,” Yameen’s office said in a statement.

The opposition Jumhooree Party says the approval of the extension is illegal, and urged Yameen to lift the state of emergency in order to restore normalcy. “Despite the State of Emergency, the country is functioning as normal as possible,” a spokesperson for the Ministry of Tourism told TPG Tuesday before the extension was approved. “Schools and government offices are in operation and we do not foresee any threats to the public or tourists. We too are continuing with the promotional activities of the destination.”

Since Yameen became president in a controversial election in 2013, he has systematically crushed dissidence within his party and removed rivals from the political arena.

For instance, MDP leader and former Maldivian president Mohamed Nasheed, the archipelago’s first democratically elected leader, was convicted on terrorism charges in 2015 and sentenced to 13 years in jail. While Nasheed has been living in self-exile in Britain since 2016, several other opposition leaders, including a former defense minister in the Nasheed government, Mohamed Nazim; Yameen’s once “trusted” vice-president, Ahmed Adheeb; and leader of the opposition Adhaalath Party, Sheikh Imran Abdulla, are in jail on long prison terms.

The opposition Maldivian Democratic Party (MDP) calls on neighboring India to militarily intervene to end the crisis, and let Nasheed become the president.

According to reports in the Indian media, the government has ruled out the military option for now, although it has activated its standing operating procedure for the Maldives by keeping troops ready for deployment there at short notice, should the need arise.

But India is said to be working with a group of countries, including the United States and Saudi Arabia, to pressure the government through imposition of sanctions. However, India has traditionally opposed the sanctions option to influence regime behavior, as sanctions affects ordinary people rather than the ruling elite.

Relations between India and the Maldives have been strong for decades; India played a major role in building the Maldives’ economy and military. It was India’s support that kept the authoritarian Gayoom in power for three decades.

However, bilateral ties have been fraying since Nasheed’s exit from power in 2012. That year, the Maldivian government abruptly terminated a $500 million contract awarded to India’s GMR Infrastructure for developing an airport in Male. Bilateral ties have deteriorated since then. Yameen’s “authoritarian governance” has irked India, but it is his tight embrace of China that has raised hackles in Delhi.

No invitation for invasion

A country could decide to send military forces to neighboring or any other country only on the request form that nation concerned. Otherwise the intervention becomes totally illegal and amounts to invasion. USA led NATO have been occupying many countries in Middle East and Afghanistan after invading them on false justifications.

Anyone who closely follows Indian state behavior abroad would quickly endorse the argument that India would not intervene in Maldives citing any reason.

In order to decide to sent troops to nearby Maldives, India must have got a request from the government of Maldives but that government has not sought it. In 1988 when India intervened in Maldives it was on the request received from the then President Gayoom.

When an external government is engaged in dealing with an emergency situation, naturally that power should be given huge service charges. Without any request from Maldivian government of Yameen, India won’t get any service charges. Though the exiled opposition leader Nasheed might be willing to pay the money to India as he has made the request to New Delhi, but India cannot respond to non-government actors.

This step alone can easily do away with any suggestion to India for intervention in Maldives.

The government of Maldives has not asked for Indian military to help bring peace and normalcy back to the island nation. India cannot attack Maldives on the suggestion by the opposition leader who now lives in Srilanka.

Claiming to be a ‘terror victim’, India would not like to be seen as an aggressor as no amount of justification can  make New Delhi “innocent” although it has got that look. .

China factor

But there are some more important reasons that deny India any chance to send troops to Maldives which, in the absence of a request from the government,   would mean to remove the President and government from power.

Today, archipelago Maldives is not alone, though insignificant for non-tourists. China is fast becoming an economic ally of Maldives and might soon have its own military bases in the island nations as well.

Chinese nexus is the prime strength Maldives would operate on.

Unlike China, USA can only bully small nations but cannot spend money on them, does not invest there to help their economies flourish. Already, Beijing, knowing the Indian strategic community’s desire for a military showcase byIndia in Maldives, has expressed its opposition to outside intervention from India.

Unlike USA, India cannot attack Maldives on the suggestion of USA or Israel or Opposition leader Nasheed and if that at all happens India would possibly be in a long term trouble.

In 2014, when Chinese President Xi Jinping visited Maldives, Yameen handed over the airport project to a state-run Chinese company. The two sides signed a string of deals during that visit that saw Beijing participate in a big way in infrastructure building in Maldives. Maldives also became an enthusiastic participant in the Maritime Belt of China’s Belt and Road Initiative.

Then in December last year, the Maldives and China signed a Free Trade Agreement, much to India’s concern. Delhi is worried about Beijing’s mounting influence over Maldives and the strategic implications for India.

China’s growing presence in the Maldives is a serious concern to India given the latter’s geographic proximity to the Indian coastline. The Maldives also sit near international sea lanes through which India’s oil imports traverse. India’s security would be threatened should the Chinese set up a naval base in the Maldives. These concerns are not without substance; in August 2017, three Chinese naval vessels docked at the Maldives’ capital, Male, setting off alarm bells in Delhi.

India’s vulnerability

India is watching the unfolding crisis in the Maldives with concern. It is mulling different options. Not doing anything is not an option given India’s stakes in a stable Maldives.

A seemingly busy India, whose PM is on a perpetual foreign tours as India’s foreign policy with very little time for the people and keeps mum on all major anti-people events, promotes rampant corruption and the powerful lords  loot the nation and its resources for private use, steel cash from nationalized banks, illegal mining and land grabbing.

IPL Modi, PNB looter Nirav Modi- both have escaped from India and are now abroad thanks to timely help and aid from agencies of Indian regime, Kothari, et al are just the tip of iceberg in Indian sage of misappropriation of state resources while the intelligence and media lords are terribly busy blasting fake news about Pakistan and Muslims in order rot keep the fanatic sections of India.

The Indian government has said it is “disturbed” by the declaration of emergency in the Maldives and “the suspension of the Maldivian people’s constitutional rights.” It is “carefully monitoring the situation,” it said. Earlier, its Ministry of External Affairs issued a travel advisory to its citizens traveling to Maldives.

Sections in India are in favor of an Indian military intervention in the Maldives. Some argue that it does not behoove a rising power with big ambitions like India to shrink away from acting robustly to defend its interests in the region.

A section of the BJP leadership has described the current crisis in the Maldives as an “opportunity” for India “to stake its claim to being a global player.” It is “imperative” for India to intervene in the Maldives, they argue,  “since any global role is always dependent on a country’s performance in the neighborhood first. Those who want to see India a superpower as soon as possible with a magic touch, say that “time is ripe for a decisive Indian intervention in the Maldives.”  Such intervention by India would have the support of countries like the USA, Israel and UK, which, they reason, would be keen to see the pro-China Yameen removed from power. “This could be used to silence the Kashmiris who fancy for sovereignty”.

If India does decide in favor of military intervention, this will not be the first time it has done so in the Maldives. In 1988, India sent in a small contingent of troops to avert a coup attempt against Gayoom. But the circumstances of that intervention were different from what exists today. In 1988, President Gayoom invited India to intervene. Yameen is unlikely to do so now. Importantly as well, 30 years ago the coup plotters were just a small group of mercenaries. A military intervention today could leave Indian troops stuck in a Maldivian quagmire.

Yameen wins power struggle

Yameen, like most rulers today, is determined to cling to power. Not only has Yameen ignored the court order, but he went on to declare an emergency and had the judges who handed out the ruling arrested. Reinstating the 12 parliamentarians would reduce his government to a minority. That would enable parliament to oust him in a no-confidence vote.

Besides, Yameen seems apprehensive that allowing Nasheed to return to the Maldives and freeing the other opposition leaders would galvanize the opposition and boost mass protests against his iron-fisted rule. Presidential elections are due later this year and Yameen fears that he will be defeated by a strong opposition campaign.

With the proclamation of a state of emergency, Yameen has prevented parliament from meeting. The emergency will be in place for 15 days, during which he can be expected to pack the judiciary with loyal judges. He is likely to engineer defections from the opposition. He could extend the state of emergency as well.

Yameen has already appointed new judges, who have since annulled the court order releasing the opposition politicians. Former president and opposition leader Maumoon Abdul Gayoom, who is Yameen’s half-brother, has been detained and Yameen has fired two police chiefs over three days.

With Yameen tightening his grip, Nasheed has called on India “to send an envoy, backed by its military to free the judges and the political detainees.” He has asked for India’s “physical presence” in the Maldives.

China has warned India against any military intervention in Maldives.

Observation

China is closely watching events in the Maldives. The archipelago is a popular destination for Chinese tourists; in light of the current uncertainty, Beijing has advised its citizens to postpone travel to the Maldives. Having invested heavily in the Maldives, China is concerned about the safety of its investments, projects, and personnel. It has asked the Maldivian government to “to take necessary measures to earnestly protect the security of the Chinese enterprises, situations and personnel.”

Unlike India, China has leverage with the Maldivian government. Yameen is likely to listen to China. But Beijing would not want to see him go.

China is opposed to India meddling in Maldives and has made this more than clear. An editorial in China’s state-run Global Times chided India for openly intervening in its neighbors’ domestic affairs. There is “no justification” for India “to intervene in Male’s affairs,” it observed.

Any military showcase by India could also prove counterproductive to India’s long-term interests. It would push Yameen closer to the Chinese, for instance. Besides, it would boost perception of India as a “big brother” and a “bully” in the region. Undemocratic forces in India’s neighboring countries have usually stoked anti-India sentiment among the masses by stressing such perceptions. This can be expected to happen in the Maldives too.

Importantly, an Indian military intervention is unlikely to benefit democratic forces in the Maldives in the long run as a democratic government, should one come to power in the archipelago following an intervention, would be seen as “made in India” with the USA acting as a “midwife.” Such a government would lack legitimacy in the eyes of many Maldivian people.

It does seem that the Sino-Indian contest for influence in the archipelago is as fierce as the ongoing tussle between Yameen and the Maldivian opposition.

Thus any suggestion for Indian military intervention in Maldives is ruled out.

India could perhaps act as a facilitator or even a mediator in a possible dialogue between Yameen’s Maldivian government and the opposition. But will Yameen welcome an Indian role against the Chinese wish? Moreover, he has reportedly defied Indian requests relating to the current crisis. India cannot have privileged the leverage to influence the decisions of Maldivian President.

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Into the Sea: Nepal in International Waters

Sisir Devkota

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A visit to the only dry port of Nepal will immediately captivate busy scenes with hundreds of trucks, some railway carriages and huge Maersk containers at play. Trains from the Port of Kolkata in India carry tons of Nepal’s exports every week. Every year, Nepal is fined millions of rupees for overstaying its containers at the designated dock in Haldiya Port of Kolkata. Nepal pays for spaces inside Indian ships to carry out its exports via the sea. This is the closest Nepal has come in exploiting economic opportunities through sea waters. Prime Minister KP Oli went one step further and presented an idea of steering Nepal’s own fleets in the vast international sea space. While his idea of Nepal affording its own ship was mocked; on the contrary, he was right. The idea is practical but herculean.

To start with, Nepal has a landlocked right to use international waters via a third country for economic purposes only. Law of the Sea conferences held during the 80’s, guarantees Nepal’s right to use the exclusive economic zone all around the globe. Article 69 of the Law of the Sea convention states that Nepal could both use sea as a trading route and exploit the exclusive economic zone of its sea facing neighbors. Nepal’s closest neighbor, India has a wide exclusive economic zone which consists of 7500 km long coastline. The article also allows landlocked nations to use docking facilities of the nearest coastal nation to run its fleets. An exclusive economic zone in sea waters is designated after a coastal nation’s eleven mile parallel water boundary ends; which is also a part of the coastal nations territory. Simply put, Nepali fleets can dock at India’s port, sail eleven miles further into international waters-carry out fishing and other activities, sail back to the Indian coast and transfer its catches back to Nepal.

Floating Challenges

Before ships can carry the triangular flag into sea waters, Nepal will need treaties in place to use coastal nation’s water to take off and build shipment facilities. Law of the Sea convention clearly mentions that the right to use another nation’s coast will depend solely on the will of the hosting coastal nation. Does Nepal have the political will to communicate and forge a comprehensive sea transit agreement with its coastal neighbors? Nepal’s chance of securing fleets in and around the Indian Ocean will depend on whether it can convince nations like India of mutual benefits and cancel any apprehension regarding its security that might be compromised via Nepal’s sea activity. The convention itself is one among the most controversial international agreements where deteriorating marine ecosystems, sovereignty issues and maritime crimes are at its core. Majority of global and environmental problems persist in the high seas; ranging from territorial acquisitions to resource drilling offences. Nepal is welcome into the high seas, but does it comprehend the sensitivity that clouts sea horizons? Nepal needs a diplomatic strategy, but lacking experience, Nepal will need to develop institutional capacities to materialize the oceanic dream. Secondly, the cost of operating such a national project will be dreadfully expensive. Does the Nepali treasury boast finances for a leapfrogging adventure?

How is it possible?

The good news is that many landlocked nations operate in international waters. Switzerland, as an example might not assure the Nepali case, but Ethiopia exercising its sea rights via Djibouti’s port could be inspiring. Before Nepal can start ordering its fleets, it will need to design its own political and diplomatic strategy. Nepal’s best rationale would lie in working together with its neighbors. The South Asian network of nations could finally come into use. Along with Nepal, Bhutan is another landlocked nation where possible alliances await. If India’s coasts are unapproachable, Nepal and Bhutan could vie for Bangladeshi coastlines to experience sea trading. Maldivian and Pakistani waters are geographically and economically inaccessible but Sri Lanka lies deep down the South Asian continent. If Nepal and Bhutan can satisfy Sri Lankan interests, the landlocked union could not only skim through thousands of nautical miles around the Bay of Bengal without entering Indian water space; but also neutralize the hegemonic status of India in the region. If such a multinational agreement can be sought; SAARC- the passive regional body will not only gain political prowess but other areas of regional development will also kickstart.

Most importantly, a transit route (such as the Rohanpur-Singhdabad transit route) from Bangladesh to Nepal and Bhutan will need to be constructed well before ships start running in the Indian Ocean. In doing so, Nepal will not only tranquilize Nepal-Bhutan relations but also exercise leadership role in South Asia. A regional agreement will flourish trade but will also make landlocked Nepal’s agenda of sailing through other regions of international sea strong and plausible. A landlocked union with Bhutan will trim the costs than that of which Nepal will be spending alone. Such regional compliance would also encourage international financial institutions to fund Nepal’s sea project. Apart from political leverages, Nepal’s economy would scale new heights with decreasing price of paramount goods and services. Flourishing exports and increased tourism opportunities would be Nepal’s grandiloquence. Nepal’s main challenge lies in assuring its neighbors on how its idea would be mutually beneficial. Nepal’s work starts here. Nepal needs to put together a cunning diplomatic show.

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Prime Minister Narendra Modi’s Hug Diplomacy Fails

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Prime Minister Narendra Modi’s enthusiasm is only to capture power; the same, however, cannot be said of foreign policy administration, especially in dealing with our immediate neighbors, and China. The best examples of his policy paralysis are the way in which demonetization and GSTs are implemented, or his sudden visit to Pakistan in December 2015. He is always in election mode. During the first two years, he was in the humor of a general election victory. Thereafter, he has spent much of his energy in establishing himself as the sole savior of the BJP in state elections, and this year he will turn his attention to the 2019 general elections.

Two years ago, without doing any homework or planning, Modi travelled to Pakistan from Afghanistan to greet his counterpart, the then Prime Minister Nawaz Sharif, to wish him well on his birthday. He hugged Sharif and spent only two hours with him to try to sort out the 70 year outstanding divergence between India and Pakistan.

Modi strategically hugs fellow world leaders. He has no strategic perception. He believes only in the power of his personal charisma in dealing with foreign policy matters. This strategy has failed considerably with China and with our other immediate neighbors, but he neither intends to accept these mistakes, nor is he interested in learning from them. More importantly, an alternative diplomatic strategy is necessary to maintain our international position; through prudent policy articulations. Let us examine the impact of his hug diplomacy.

During the 2013/14 general elections campaign he attacked the Congress-led UPA government on multiple fronts, including towards former Prime Minister Dr.Manmohan Singh’s policy on Pakistan. He proposed that the BJP government would have more guts to better deal with Pakistan. Under his administration, we lost numerous soldiers in fighting with Pakistan terrorists, experienced a 100-day shutdown in Kashmir, blindly allowed a Pakistan team to inspect our Pathankot Air Force Station, and generally continued down a visionless path in foreign policy. These indicate that Modi’s defensive and offensive strokes against Pakistan have failed completely, including the most politicized ‘surgical strike’ that did not contain the terrorists from Pakistan. Today, the Modi government is searching for policy directions in handling Pakistan, but sat in a corner like a lame duck.

In the beginning, when he took office, Modi perhaps believed that ‘everything is possible’ in international affairs simply by virtue of occupying the prime minister seat. Further, he thought that all his visits abroad would bring a breakthrough. His hugs with counterparts, various costume changes, and the serving of tea, indicate that our prime minister is using soft power approaches. These approaches were used by our first Prime Minister Nehru whilst India did not have a strong military or economy. However, India is not today what it was in the 1950/60s. Presently, hugging and changing costumes will not necessarily keep India influential in international relations, especially at a time when the world is undergoing multi-polar disorder. However, he is in continuous denial that his paths are wrong, especially in dealing with our neighbors.

What is the BJP led-NDA government policy on Pakistan? Does this government have any policy for Pakistan? Since 2014,Modi has not permitted the Minister of External Affairs, Sushma Swaraj, to contribute to any foreign policy articulations. As long as Sushma fulfills the duty of Ministry of Indian Overseas Affairs she will receive praise from the prime minister’s office.

During 2015 he met Sharif at his residence in Islamabad to give him a hug. This happened exactly two years ago. Further, this is a very serious question that the Media and Modi-supporting TV channels forgot to raise. Instead, without hesitation, they praised him for touching the sky, and described the moment as a diplomatic initiative for a breakthrough with our neighbor Pakistan. The Media will realize this mistake when their traditional viewers switch over to other channels to get centrist news.

What are the outcomes of Modi hugging Sharif at his residence? The results are terrible. India’s relation with Pakistan touches the lowest ever level in a history of 70 years. The Mumbai terror attack mastermind Hafiz Saeed was released from house arrest and has started a political party to contest the general elections in Pakistan next year. This government does not have the guts to put pressure on Pakistan to provide the evidence – as requested by the Pakistan’s Court – essential to keeping the trial alive against Saeed. Modi has often preached that his government succeeded in isolating Pakistan in the international domain. The reality would be as much India diplomatically isolating Pakistan from the international community as the vacuum has been comfortably filled by China without any difficulty. These are the achievements that Modi’s hugs have brought to India.

The stability of Afghanistan is in India’s long-term strategic interest. India’s ‘aid diplomacy’ to Afghanistan in various fields has been increasing day after day, including infrastructure development and the training of Afghan security forces. Yet, India’s influence in Afghanistan is in disarray. Former Afghanistan President Hamid Karzai said, “India should have its own policy on Afghanistan”. However, Modi’s policy makers in New Delhi are expecting the US President Donald Trump and Secretary of State Rex Tillerson to maintain India’s active and significant role in Afghanistan.

India showed its displeasure during the constitutional crisis in Nepal, in halting energy supply to Kathmandu. This forced the land-locked country to obtain easy support from Beijing. Nepal was once the buffer state between India and China; it is now sitting on China’s lap and steering India. Modi’s mute approach to the Rohingya crisis speculates India’s major power ambition. This is a serious setback to India’s diplomacy: it is now pushing Myanmar to get support from China, along with our neighbor Bangladesh, in resolving the crisis with Rohingya refugees.

The first democratically elected government under Mohamed Nasheed was toppled unconstitutionally in Maldives. Since India has failed to raise any substantial voice against this atrocity, China has jumped onto the scene. New Delhi ought to have designed a policy to resolve the political crisis, but India, the world’s largest democracy, has watched this incident as a movie in the Indian Ocean Theatre. The highlight was the decision of our Prime Minister to skip a visit to the Maldives whilst on his tour of the Indian Ocean islands.

In Sri Lanka, China is designing its future battlefield against India. As the war against LTTE was over, Colombo started travelling in a two-way track, with India and China. Beijing’s love affair, apparently with Colombo, but with an eye on New Delhi, is no secret. Since Modi has allowed these developments without exercising any diplomatic resistance, he has given China a comfortable seat inside Sri Lanka. China has now realised that her weaved network against India can be strengthened easily in the Indian Ocean, because New Delhi only displays silent concern. After Modi took office, India – China relations have remained static. The border talks are on stand still. Beijing holds on to extend a technical hold on Masood Azhar, a UN designated terrorist. The dragon pulls our immediate neighbors to her side. These developments indicate that our foreign policy articulations are not supported by any clear strategic trajectory.

Modi’s diplomacy is like an air balloon which, once torn, cannot be refilled; a new balloon is needed. Hugging a leader does not lead to any commitment in foreign affairs. Personal charisma does not work as a foreign policy tool in dealing with a world power. For this reason, Modi cannot understand the setback he is facing with China, Pakistan, and our other neighbors. In comparison, Vajpayee’s or Dr. Manmohan Singh’s combined simple charisma as leaders or economists with appropriate home-work in the past; has caused tremendous results in foreign policy, including expected results in Indo-US nuclear negotiations. This is completely missing in Modi’s administration.

Hence, the newly elected Congress Party President Rahul Gandhi has said, “Modi’s hug diplomacy fails”. It was a valuable comment that the ruling elite should consider as a meaningful insight. Alternative approaches are vital to regain our neighbors’ trust, as opposed to China’s. However, Prime Minister Modi’s this year of work will be focused on the 2019 general elections, compromising the proper attention due to India’s international diplomacy.

First published in Congress Sandesh

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