An Indian Prime Minister delivered the plenary address at the Davos World Economic Forum for the first time. Narendra Modi took this opportunity to put up a strong plea for globalization. This is very significant at this moment when a trade war threatens to undermine the World Trade Organisation (WTO). US has imposed steep tariffs on import of solar panels and washing machines. China has been most affected and it is natural that it will go for a strong retaliation. Last year at Davos Chinese President Xi Jinping argued strongly in favour of globalization which he said powered global growth. But it was sheer talk. China has remained self-centred and mercantilist. In South Asia, China openly supports the ecosystem of terrorism by defending terror groups in Pakistan. It is presumably to contain the growing power of India. China’s anti-globalization is hurting everybody. It has evidently aided the rise of hostility in Donald Trump’s US and elsewhere.
However, as the world has become fragmented, opportunities have been created for India to step in and fill the void created by lack of leadership. If other countries, particularly the US, go for protectionism, India can gain significantly by opening up its markets. Narendra Modi highlighted this aspect of his policy. India’s new economic orientation should be able to attract significant amounts of international investment. Modi has rightly emphasised India’s commitment to eradicate licence raj and facilitate ease of doing business. Red tape will have to go in international collaboration pursued by India. However, there are hurdles inside India as Indians are suffering from demonetization and restrictive planning. Pollution is alarming in cities and villages. India is 117th out of 180 countries in the Global Environmental Performance Index. Will Modi’s pitch at Davos bear fruit and invite foreign investment? We have to wait and watch!
