Major objectives of India’s economic diplomacy are the facilitation of exports, acquisition of new technologies and energy resources, promotion of India as attractive investment destination, and promotion of Indian investments abroad, especially in energy sectors. In order to attain these aims, India pursues information and promotional campaigns, uses foreign aid as a lever for export facilitation, and negotiates favourable regulation to access other markets. Even though the Ministry of External Affairs plays a crucial role in foreign policy, there are several institutions engaged in economic diplomacy (e.g., the Ministry of Commerce and Industry, Ministry of Finance, etc.), but the lack of sufficient coordination among them hinders improvement of policy efficiency.
Since liberalisation of the economy led to the emergence of a vibrant and active private sector interested in global expansion, the government has eagerly engaged business to promote its economic interests abroad. Organisations, such as the Federation of Indian Chambers of Commerce and Industries (FICCI), the Confederation of Indian Industries (CII) and the Association of Chambers of Commerce (ASOCHAM), have become important instruments in facilitating contacts with foreign partners and presenting the attractiveness of the economic opportunities that India offers. They regularly organise conferences on the Indian economy and business forums with foreign partners, receive trade missions and promote India as land of opportunities for business.
The Indian government also seeks innovative tools to present India as an attractive economic power. For instance, in 2006, the Department of Commerce in the Ministry of Commerce and Industry, together with the CII, created a private-public partnership titled the “India Brand and Equity Foundation” (IBEF), “to promote and create international awareness of the Made in India label in markets overseas and to facilitate dissemination of knowledge of Indian products and services” (IBEF website, 2014). IBEF became a premier institution engaged in promotion of an attractive ‘Brand India’ through its reports, data, surveys, active use of Internet and social media, and organisation of promotional and investments campaigns abroad.
Most of these “nation branding” campaigns were targeted at the West, which remains a major source of capital, technologies and tourism for India. Some prominent examples include the “India Everywhere” campaign at the Davos Summit in 2006, and the “India@60” program, involving events in India, the US and Europe. Another famous case of a more active nation branding campaign exercise is the “Incredible India” campaign launched in 2002, by the Ministry of Tourism, in cooperation with private partners, to promote India as an attractive tourist destination. Indian delegations are more active participants in world trade fairs (including a large presence at the last EXPO, in Shanghai, in 2010); India continues to emerge as a new important host of trade fairs in many sectors.
Another important area of economic diplomacy is multilateral trade negotiations. While India has presented defensive interests at global talks at the WTO, it has become more willing to enter regional trade agreements. The first free trade agreement, signed with Sri Lanka, in 1998, turned out to be a great success, leading to manifold increase in bilateral trade and strengthening bilateral ties. Since then, India has signed several bilateral and regional deals: Preferential Trade Agreements (PTA), Free Trade Agreements (FTA) and Comprehensive Economic Cooperation Agreements (CECA). These included, among others, a PTA with Afghanistan, Israel, Chile and MERCOSUR; an FTA with SAARC and ASEAN; and a CECA with Singapore and South Korea. Moreover, it is negotiating a few more FTAs with several partners, including the European Union and Canada. Although many of these FTAs are limited in scope and often do not really succeed in helping remove persisting obstacles to trade, such as non-tariff barriers, they do point to a gradual opening of the Indian economy.
The economic dimension of foreign policy has become especially apparent in relations with India’s neighbours in South Asia. Beginning in the mid-1990s, and with the announcement of the Gujral Doctrine, India pushed for closer economic cooperation among the SAARC members. It offered more preferential regulations towards smaller partners (such as the MFN status to Pakistan, awarded unilaterally in 1996, or FTA with Sri Lanka, in 1998) and presented a vision of deeper economic interdependence. As Foreign Secretary Shiv Shankar Menon (2006) declared, at a lecture in Delhi in 2006, “we must give our neighbours a stake in our own economic prosperity” to promote the idea of ‘dense interdependence’.”
Although this strategy has genuine economic and security objectives, it discloses that India wants to change its image as a “big brother” and present itself as a more benign and attractive partner. As Foreign Secretary Shyam Saran said, in February 2005: “The challenge of our diplomacy lies in convincing our neighbors that India is an opportunity not a threat, that far from being besieged by India, they have vast, productive hinterland that would give their economies far greater opportunities for growth than if they were to rely on their domestic markets alone” (quoted in Mohan, 2007: p.114). As India’s economic growth increases, further disparities in relation to its smaller neighbours, positioning India as an “opportunity” and not a “threat”, become important an element of soft power strategy in the region.
Cultural Diplomacy
Culture has been natural tool of diplomacy for centuries, as is well illustrated in a custom of gifts and cultural artefacts exchange by emissaries of ancient kingdoms across continents. As culture is a prime source of a country’s soft power, cultural diplomacy is a crucial instrument to enhance the attractiveness of states and influence the preferences of others. It entails establishing and nurturing cooperation with other countries through use of culture, art and education.
In India, international cultural cooperation lies in competence of the Ministry of External Affairs and the Ministry of Culture. Whereas the former sets up general directions and priorities for cooperation, the latter gives the legal framework for cultural exchange with different countries. In 2012, the Ministry of Culture had bilateral cultural agreements with 126 states and cultural exchange programmes with 58 states (MC, 2013: p.36). Furthermore, the ministry supports international collaboration and promotion of Indian culture abroad, provides grants to India Friendship societies in foreign countries (45 in 2012), facilitates the Indian Literature Abroad project, which aims to translate and popularise literature in Indian languages into five UNESCO languages and, finally, participates in regional and multilateral cultural forums.
The primary public institution responsible for implementation of cultural cooperation programmes and promotion of Indian culture abroad is the Indian Council for Cultural Relations (ICCR). The Council was founded in 1950 by Maulana Abdul Kalam Azad, independent India’s first education minister, with the primary objective of establishing, reviving, and strengthening cultural relations and mutual understanding between India and other countries (MEA, 2000). Its aims are to actively participate in the formulation and implementation of policies and programmes pertaining to India’s external cultural relations; to foster and strengthen cultural relations and mutual understanding between India and other countries; to promote cultural exchange with other countries and people; and to develop relations with national and international organisations in the field of culture (ICCR website, 2014). Although this is a semi-autonomous public agency, it works under the supervision of the Ministry of External Affairs. The activities of the Council include (ICCR, 2013):
Operation of Indian Cultural Centres abroad and Regional Offices within India.
Establishment and operation of Chairs for Indian Studies in foreign universities.
Administration and granting of scholarship schemes for overseas students, and supervision of the international student welfare.
Exchange of exhibitions; exchange of groups of performing artists.
Organisation of and participation in international seminars and symposia.
Participation in major cultural festivals abroad; Organisation of “Festivals of India” abroad; organisation of lecture-demonstrations by pe
rforming artists abroad.
Organisation of the Distinguished Visitors Programme, under which eminent guests from abroad are invited to India.
Presentation of books, audio-visual material, art objects and musical instruments to institutions abroad.
Providing the Secretariat for the Jawaharlal Nehru Award for International Understanding.
Organisation of the Annual Maulana Azad Memorial Lecture and the commemoration of Maulana Azad’s Birth and Death Anniversaries; Maintenance of a well-stocked library and the manuscripts of Maulana Abdul Kalam Azad.
Publication of journals for distribution in India and abroad.
Digitalization of rare manuscripts.
Awarding of Library Fellowships.
Supporting Hindi-related activities, including publication of a Hindi magazine, Gagananchal.
Undertaking projects on behalf of the Ministry of External Affairs.
As India hasbeen paying more attention to its soft power over the last 10–15 years, ICCR has substantially expanded its global outreach and reinvigorated its activities. To this end, it was allotted additional funding to promote India’s culture abroad, and all major programs of the Council have been strengthened, including Indian Cultural Centres abroad, chairs of Indian studies at foreign universities, scholarship programmes, and organisation of festivals of Indian culture, seminars, conferences and cultural programmes.
Back in 1999, ICCR had run only 14 Indian Cultural Centres abroad, offered around 1,000 scholarships to foreign nationals from around 80 countries, and sent 19 professors on deputation abroad, teaching Hindi, Sanskrit, Tamil, Malayalam, modern Indian history, and Indian civilization as chairs of Indian studies. Its budget from a grant of the Ministry of External Affairs at that time stood at Rs. 36 crore. In the financial year 2012–13, the Council received a sum of Rs. 1572.9 crore, as grant-in-aid from the Ministry of External Affairs. The actual expenditure during this period was Rs. 2426.8 crore (ICCR, Annual Report 2012–2013, 2013). In a period of about 15 years, the support for the ICCR from the Ministry increased about 46 times, which allowed for more active cultural diplomacy.
The network of Indian Cultural Centres in different parts of the world has been expanded from 14, in 1999, to 22, in 2007, and to 35, in 2013. Moreover, the ICCR had planned to open 15 new centres within the next two years “in order to expand its reach and promote India’s soft power abroad” (ICCR website, 2014). The new centres will be located in India’s immediate and extended neighbourhood, in P-5 capitals, in Africa, and in Latin America. The Cultural Centres function under the administrative control of the Council and the respective Indian Missions abroad with the main task of promoting India’s composite cultural heritage. (ICCR website, 2014c). The activities of these Indian Cultural Centres can broadly be classified under two categories. First, they cater to local needs by keeping in touch with overseas Indians in countries such as Trinidad and Tobago, Mauritius, Guyana, Suriname, etc.; second, they work like promotional centres, exposing Indian culture to the population of the host country.
As the number of centres has increased in the last decade, so has the number of chairs of Indian studies. From only 19 scholars, sent abroad in 1999, the number increased to 93, in 2012, and to 108, in 2014. Out of these 108 chairs, 35 teach Indian languages such as Hindi (25 chairs, of which 11 are manned by school level teachers instead of professors), Sanskrit (7 chairs), Tamil (2 chairs) and Bengali (1 chair). The remaining 73 chairs are for teaching various humanities and social science subjects across the spectrum of socio-cultural, political, academic studies such as history, economics, international relations, philosophy, Buddhist studies, literature, Tagore studies and cinema, etc. (ICCR, 2013: p.8). The purpose of these chairs, apart from educating foreign students about India, is to become a nucleus around which Indian studies can develop in academic institutions abroad. (ICCR website, 2014d). They are established mostly at foreign universities by the ICCR, in consultation with Indian missions abroad.
Another important activity of the ICCR is administration of scholarship programmes tfor foreigners studying in India. The number of scholarships has risen over three times compared to the early 2000s. The Council administered 3,334 scholarships during 2012–13 under various schemes for foreign students to pursue undergraduate, post-graduate and doctoral programmes as well as professional courses (ICCR, 2013: p.7). In 2013–2014, the ICCR offered 3,365 scholarships, in total, under 24 scholarship schemes, to people from about 135 countries. Most of the scholarship holders come from developing countries in Asia, Africa, and South and Central America. The largest groups are from Afghanistan (over 1000) and Africa (900). In total, in 2014, around 4,750 foreign students were studying in India under the various scholarship schemes. (ICCR website, 2014e). Not only were they studying about Indian history, dance, music, painting, sculpture, etc., they were also taking professional and technical courses such as engineering, pharmacy, accountancy, business administration and management. Students are offered a modest stipend and welfare, and orientation programmes run by the ICCR. Management of scholarships is the second largest ICCR expenditure (after Indian Centres Abroad), which in 2010–2011amounted to Rs. 2857.30 lakhs.. Although the scale of support for foreign students is less impressive when compared to other powers such as China, the US or the UK, it shows considerable effort by India to leverage its soft power.
The ICCR has become more active in other cultural activities as well. For instance, during 2012–13, the Council sponsored 153 groups to present varied forms of Indian dance, music and other performing artsin markets abroad; sponsored visits by 62 eminent Indian scholars, intellectuals, academicians and artists to foreign countries under the Outgoing Visitors Programme; invited seven eminent foreign academicians under the Academic Visitors Programme; organized several festivals and events performing Indian culture abroad and cultural events of other countries/regions in India (ICCR 2013). The council also publishes six journals in five different languages, namely, Indian Horizons and Africa Quarterly (both in English), Gagananchal (Hindi, bi-monthly), Papeles de la India (Spanish, bi-annual), RencontreAvec L’ Inde (French, bi-annual) and Thaqafat-ul- 14 Hind (Arabic, Quarterly).
Despite this remarkable progress and expansion of ICCR activities, it still has a long way to go to reach a level comparable to other major powers, including China. Tharoor (2012: p.291) rightly observed that “The ICCR has done good work, but at a modest level of ambition, and it has appeared to its well-wishers to be in serious need of additional resources, both financial and creative, if it is to make a serious global impact.” The Council concentrates on promotion of traditional Indian culture (music, dance, theater) which, in a sense, strengthens the image of India abroad as an exotic Oriental country.
Foreign Assistance
Foreign aid is another example of India’s rising soft power capabilities. Although the country had already started helping less developed countries, from thethe1940s, it is only recently that this has been recognized as an important element of its foreign policy. Just after independence, despite massive internal development needs, India started limited aid for Nepal and Bhutan, and in 1949, launched a cultural fellowship programme. In 1964, its flagship Indian Technical Cooperation Program was initiated to share its expertise with fellow developing countries. From the very beginning, the foundation principle of India’s development cooperation policy became an approach for friendship and cooperation, and the aim of peaceful co-existence (Chaturvedi, 2012: p.558). While being, traditionally, one of the largest recipients of development assistance from other developed countries, India has cultivated the development cooperation described in the spirit of solidarity and South-South Cooperation (SSC), stemming from the philosophy of Gandhi and Nehru, already exposed in the 1947 Asian Nations Conference, in New Delhi.
Chaturvedi points out that “development cooperation policy of India underwent dramatic policy changes in the early 2000’s” when it terminated aid from many smaller donors and, stepped up its support to othe
r developing countries. (2012: p.559). This marked a major shift from “India as beneficiary” of foreign aid to “India as important provider of aid.” The change was brought about mostly by the newly found economic strength after the first decade of liberalisation reforms in the 1990s and its rising self-confidence. India also wanted to promote its image as a rising power—one that does not need assistance from abroad. In an expert’s words: “the new economic strength of India is providing the material base for elevating SSC beyond rhetoric to more substantive operations” (Chaturvedi, 2012: p.558). It is only in the last ten yearsthat India’s external aid programme has undergone significant expansion in terms of geographical reach, modes of support and financial scale.
It is not easy to precisely assess how much India spends in the area of development assistance. India is not part of the OECD Development Assistance Committee and does not comply with its definition of aid and standards on evaluation and reporting of aid. Unlike China, India has not presented any comprehensive report in which it has made an official self-evaluation of its aid. Delivery of assistance is dispersed among many ministries, agencies and institutions, which further complicates formulating a clear picture. The Ministry of External Affairs annually produces data regarding aid only in the form of technical and economic assistance, and this does not include some elements of Indian aid, such as scholarships or foreign loans. According to some estimates, “India disbursed over $1.5 billion in traditional foreign aid in 2011 – second only to China among developing country donors” (Mullen and Ganguly, 2012). One of the best experts on Indian aid points at much higher number – even US$ 3 billion, including the spending on peacekeeping, loans and technical assistance (Chaturvedi, 2013). Even when one looks only at the aid administered by the MEA, it seems clear that India’s foreign assistance has risen substantially over the last decade. Indeed, the budget of the Ministry of External Affairs assigned to Technical and Economic Cooperation has grown from Rs. 1025.64 crore in 2003–04 (MEA, 2004: p.166) to Rs. 3233.93 crore in 2012–13 (MEA, 2013: p.173). In 2012–13, it accounted for one third of the whole budget of the Ministry of External Affairs.
India’s Soft Power Page 13