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CWA # 147, 16 July 2019

G-20 Summit
Can Hedging be India’s Strategy?

  Vivek Mishra

India clearly drew close to Russia and China with the informal summit between the three countries, signaling that Trump might have overplayed his hand to push India on issues of trade and tariff.

Dr Vivek Mishra, is an Assistant Professor at the Netaji Institute for Asian Studies, Kolkata. He can be reached at viveksans@gmail.com

 

India’s participation at the G20 Osaka summit has been perceived with ambiguity, distrust and, also as smart navigation. While the sense of ambiguity emanates from the fact that a single concrete standout outcome favouring India was missing, the distrust centres on whether India has been able to make any substantive impact in a global environment which is dominated by the still ongoing U.S.-China trade rivalry. There is still a third perception that India’s participation reflected calculated hedging between all great power participants with enough bilateral, trilateral and other meetings on the sidelines of the G20 meet, advancing its agenda of ‘reformed multilateralism’ in India’s favour – characterized by a diplomatic tightrope between major powers at the summit.

Even before the meet began, there was palpable apprehension that the trade war between the two leading countries of the world, the U.S. and China would derail any countable deliverables from the meeting for India. However, much of the apprehension was well managed in the end by the broad-basing of its national agendas and engaging multiple stakeholders at the summit. India’s participation in the G20 was characterized by a broad spectrum of meetings spanning bilateral, trilateral and multilateral formats. The most prominent ones included trilateral meetings with the US and Japan (JAI), with Russia and China (RIC), multilateral meeting with BRICS countries, and bilateral meetings with the U.S, France, South Korea, Saudi Arabia, South Korea and Germany, besides last day meetings with the leaders of Indonesia, Brazil, Turkey, Australia, Singapore and Chile.

India’s choice of engagement with world leaders, issues and perceived impression, all symbolized a well-thought balance between its key concerns and stakeholders. While the lack of direct confrontation between the US and India, potentially stoked by Trump’s Tweet at the heels of the G20 meet that India’s import tariffs were “unacceptable” and that they must be “withdrawn”, mitigated initial apprehensions. India did smart balancing through its informal RIC summit and an equal-footing engagement with China and Russia - two other major powers at the summit, albeit in another camp than the U.S. 

Over the years, the agendas of G20 meets have diversified from just the issues of macro economy and trade to include global issues like development, climate change and energy, health, counter-terrorism, as well as migration and refugees. New Delhi today has climbed to being the fifth largest economy in GDP terms, emerged as one of the global leaders in the fight against climate change with its Paris Climate deal commitments and its International Solar Alliance initiative, and attempts to champion the cause of counterterrorism across global summits. To the extent that these issues have enhanced the bandwidth of India’s negotiations at global high tables, the Osaka G20 meet of this year was a careful, if not successful, an attempt at hedging on multiple bets spanning across quite a few countries and even more issues.

Is hedging likely to pay off?

India clearly drew close to Russia and China with the informal summit between the three countries, signalling that Trump might have overplayed his hand to push India on issues of trade and tariff. This seems further validated in hindsight. Just days after the G20 meet, President Trump Tweeted again targeting India in which he insisted that tariff on American goods are no longer acceptable, doubling down on India since the two leaders met at G20 summit. 

Washington must understand that cornering India on trade, especially when the former is already dealing with a massive trade dispute with China, might harm relations between New Delhi and Washington. Already, energy imports and broader ties with Iran along with defence purchases from Russia have redirected Trump’s ire to India. Under pressure, India has significantly lowered its energy imports from Iran, has avoided Iranian air space incurring a loss and deployed its ships to escort Indian vessels out of the Gulf area. These steps have sent wrong signals to Tehran, a long term friend with historical ties, potential energy partner and a country where India commands some soft power leverage.

While Washington’s strategy to push India against the wall vis-a-vis Iran seems to have paid off as Iran is a smaller economy and lacks a seat at the global high table, Russia and China will be difficult countries to push around. Despite continuing U.S. sanctions, Russia continues to pursue its global and regional military strategy with confidence and is drawing closer to Beijing with every mutually antagonistic decision that Washington takes against the two countries. In such, circumstances, the probability of hedging opportunities for India, China and Moscow apropos their relations with the U.S. are likely to grow. For instance, any expansion in the scope of existing relations between India and Russia would eat into the strategic space of US-India relations that have been carefully nurtured over the past decade and a half. And excessive pressure from Washington is likely to open the Moscow-Beijing front for New Delhi, as has been evident during the G20 Osaka meet, and even so, after the summit. Carrying forward the RIC bonhomie from the Osaka G20 meet, the three countries have decided that they will hold Indo-Pacific consultations. While the move to work with Russia and China validates India’s ‘inclusive’ Indo-Pacific strategy, it has eaten into the space of US-India strategic cooperation by further diluting India’s role in US’ Indo-Pacific strategy, especially the Quad. 

Sadly for New Delhi, hedging cuts both ways. Russian pressure and Moscow’s own ability to hedge against India is a growing reality. Russia’s relations with Pakistan have been on an upward trend. India’s growing defense relations with the U.S. has certainly pushed Moscow’s defence supplies to Pakistan into the near-future-reality realm - likely to significantly reduce conventional capability gap and edge. However, more immediate concern for India should be Russia’s recent reaction to the Indian Air Force’s decision to sling British ASRAAM air combat missiles onto its Russian Su-30 fighters: “No country would allow this”. Besides constricting the hedging space that India as a historically neutral party has enjoyed, Russia’s concern with fitting foreign assets on platforms sold to India is only the spectral opposite of interoperability concerns arising from Washington regarding Russian systems’ marriage with American or European platforms. This is telling of how difficult India’s hedging strategy is going to get in the near future, with increasing pressure from all major stakeholders.

If G20 was any premonition of India’s state behaviour under increased pressure from Washington, there is more hedging behaviour in store - which is not likely to play in an entirely beneficial manner for New Delhi.

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