Broadly speaking, there are four types of countries. One is large and rich; another is large and poor; a third is small and rich; and the fourth is small and poor.
The US is large and rich. China is large, poor and pretending to be rich. India is large, poor and trying to get rich. Switzerland is small and rich and likes it that way. And Somalia is small and poor and nuisance to everyone.
The question arises: in the era after the Treaty of Westphalia in 1648 and the emergence of the notion of nation-states, how should these countries conduct their foreign policy?
Very carefully, says Shyam Saran, who should know. Saran took courtesy in the face of stupidity to a new level.
The man
After all, he has been India’s foreign secretary. He has also been Prime Minister Manmohan Singh’s Special Envoy for various odd jobs like the international negotiations of environment.
He has been an ambassador thrice. He has served in important countries such as Japan (small and rich) and Nepal (small and poor).
He has dealt with the US (large and rich) on Manmohan Singh’s pet project, the Indo-US nuclear deal which ended India’s pariah status. Saran has also headed the National Security Advisory Board.
And most recently he has headed a foreign policy think tank in New Delhi. Recently, he has become a life trustee of the India International Centre.
The book
Saran starts with a highly accessible discourse on dealing with other countries in general and how India has, and should, deal with them in particular. His central thesis is that where foreign policy is concerned, the Indian view is determined by its geography and history, both of which make it view the countries to the east and the west as a continuum, which has been interrupted by Partition.
Citing Kautilya and other such ancient thinkers he says unlike China, India doesn’t see itself as the centre of the universe. Instead, it sees itself as one amongst equals, a part of the Jambudweep – immortalised in the equivalent of our ancient GPS system, Jambudweepae, Bharatvarshe, Bharatkhande, Kaliyuge, Prathamapade, Yamuna teeray...
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The calm and unhurried tone of this book suggests that governments should seek his counsel more often, for when you read this book you will see how rich it is in experience. Had Mr Modi done so from the start he might have avoided some major embarrassments with Pakistan and China.
It is also a treasure trove of anecdotes that give you terrific insights into how diplomacy and negotiations are conducted.
Thus, says Saran, Prime Minister Narasimha Rao told him that a good leader must be both ruthless and ascetic. It is easy to see how Mr Modi fulfils those requirements perfectly.
On another occasion, during the nuclear deal negotiations, President George W Bush told him about Manmohan Singh: “This man is my friend; you take good care of him.”
He also tells us about how American diplomats think diplomacy should be carried out — in a “listen you son of a……” mode. As we saw during the Doklam incident, the Chinese now think they can do the same.
India’s generally unflappable approach to such boorish behaviour has been very laudable. Saran gives many examples of this in his book.
Overall, he says, given how weak India’s hand has generally been, Indian diplomacy has been very successful. In any given period of ten years, it has got most of what it wanted.
Not just that. Barring China and Pakistan, it doesn’t have any real enemies, even in South Asia.
Dealing with Pakistan
Without explicitly stating it, Saran shares the general Indian view that Pakistan’s India policy is run by a bunch of nut cases in the army who just can’t get over the fact that they lost half their country in 1971 after a humiliating defeat by the Indian army. So revenge is the driving force, regardless of the way they take it.
There’s also Jinnah’s notion of parity. Pakistan genuinely believes it is exactly equal to India and this leads to its monkey see, monkey do behaviour.
India, meanwhile, obsesses over the possibility that these kooks, having broken their country once, may well oversee its disintegration again. That would be bad enough if Pakistan didn’t have nuclear weapons. But with them, it is a horrible prospect.
So net result: Pakistan harms us and we placate it. He concludes by saying that if Pakistan becomes too much of a bore, “we may have to adopt counter-constraint policies to attempt to change the strategic calculus in Islamabad. This may include the option of inflicting pain on Pakistan…”
In short, we are stuck with an irrational neighbour and must make the best of it.
Handling China
If Pakistan poses one sort of intractable problem China poses another sort, says Saran. But while we fully understand Pakistanis, we don’t understand the Chinese very much at all, not least the way the Chinese use deception and ambiguity in their utterances. He gives two telling examples of this, both dating back to Nehru.
Basically, says Saran, China views the rest of the world as subordinates. This sense of entitlement is something India must keep in mind while dealing with China.
But, he adds, while that may have been on in the past when China’s dealings with the rest of the world was limited, today in a globalised world with many middle powers “the Chinese perspective derived from its past is in contradiction to the prevailing reality.”
The US
In contrast to Pakistan and China, dealing with the US is almost a pleasure, Saran suggests. For one thing, even if they don’t always help, American governments at least don’t hate India (Pakistan) or treat it with contempt (China).
Saran gives an absolutely riveting account of how the Indo-US nuclear deal unfolded and was eventually signed. That was the crowning moment of Saran’s illustrious career.
To conclude, this is a MUST read book.
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Steve Ovett, the famous British middle-distance athlete, won the 800-metres gold medal at the Moscow Olympics of 1980. Just a few days later, he was about to win a 5,000-metres race at London’s Crystal Palace. Known for his burst of acceleration on the home stretch, he had supreme confidence in his ability to out-sprint rivals. With the final 100 metres remaining,
[wptelegram-join-channel link=”https://t.me/s/upsctree” text=”Join @upsctree on Telegram”]Ovett waved to the crowd and raised a hand in triumph. But he had celebrated a bit too early. At the finishing line, Ireland’s John Treacy edged past Ovett. For those few moments, Ovett had lost his sense of reality and ignored the possibility of a negative event.
This analogy works well for the India story and our policy failures , including during the ongoing covid pandemic. While we have never been as well prepared or had significant successes in terms of growth stability as Ovett did in his illustrious running career, we tend to celebrate too early. Indeed, we have done so many times before.
It is as if we’re convinced that India is destined for greater heights, come what may, and so we never run through the finish line. Do we and our policymakers suffer from a collective optimism bias, which, as the Nobel Prize winner Daniel Kahneman once wrote, “may well be the most significant of the cognitive biases”? The optimism bias arises from mistaken beliefs which form expectations that are better than the reality. It makes us underestimate chances of a negative outcome and ignore warnings repeatedly.
The Indian economy had a dream run for five years from 2003-04 to 2007-08, with an average annual growth rate of around 9%. Many believed that India was on its way to clocking consistent double-digit growth and comparisons with China were rife. It was conveniently overlooked that this output expansion had come mainly came from a few sectors: automobiles, telecom and business services.
Indians were made to believe that we could sprint without high-quality education, healthcare, infrastructure or banking sectors, which form the backbone of any stable economy. The plan was to build them as we went along, but then in the euphoria of short-term success, it got lost.
India’s exports of goods grew from $20 billion in 1990-91 to over $310 billion in 2019-20. Looking at these absolute figures it would seem as if India has arrived on the world stage. However, India’s share of global trade has moved up only marginally. Even now, the country accounts for less than 2% of the world’s goods exports.
More importantly, hidden behind this performance was the role played by one sector that should have never made it to India’s list of exports—refined petroleum. The share of refined petroleum exports in India’s goods exports increased from 1.4% in 1996-97 to over 18% in 2011-12.
An import-intensive sector with low labour intensity, exports of refined petroleum zoomed because of the then policy regime of a retail price ceiling on petroleum products in the domestic market. While we have done well in the export of services, our share is still less than 4% of world exports.
India seemed to emerge from the 2008 global financial crisis relatively unscathed. But, a temporary demand push had played a role in the revival—the incomes of many households, both rural and urban, had shot up. Fiscal stimulus to the rural economy and implementation of the Sixth Pay Commission scales had led to the salaries of around 20% of organized-sector employees jumping up. We celebrated, but once again, neither did we resolve the crisis brewing elsewhere in India’s banking sector, nor did we improve our capacity for healthcare or quality education.
Employment saw little economy-wide growth in our boom years. Manufacturing jobs, if anything, shrank. But we continued to celebrate. Youth flocked to low-productivity service-sector jobs, such as those in hotels and restaurants, security and other services. The dependence on such jobs on one hand and high-skilled services on the other was bound to make Indian society more unequal.
And then, there is agriculture, an elephant in the room. If and when farm-sector reforms get implemented, celebrations would once again be premature. The vast majority of India’s farmers have small plots of land, and though these farms are at least as productive as larger ones, net absolute incomes from small plots can only be meagre.
A further rise in farm productivity and consequent increase in supply, if not matched by a demand rise, especially with access to export markets, would result in downward pressure on market prices for farm produce and a further decline in the net incomes of small farmers.
We should learn from what John Treacy did right. He didn’t give up, and pushed for the finish line like it was his only chance at winning. Treacy had years of long-distance practice. The same goes for our economy. A long grind is required to build up its base before we can win and celebrate. And Ovett did not blame anyone for his loss. We play the blame game. Everyone else, right from China and the US to ‘greedy corporates’, seems to be responsible for our failures.
We have lowered absolute poverty levels and had technology-based successes like Aadhaar and digital access to public services. But there are no short cuts to good quality and adequate healthcare and education services. We must remain optimistic but stay firmly away from the optimism bias.
In the end, it is not about how we start, but how we finish. The disastrous second wave of covid and our inability to manage it is a ghastly reminder of this fact.