By 1980s? end, India?s development and security paradigms were being reinvented. Rajiv Gandhi was laying down the new vision and developing the idea that India would pursue its goals in a policy of ?concentric circles of influence?. He was developing the concept that India would grow fast as a part of a globalising world. There was a refreshingly youthful emphasis on technology and the newer organisations and social institutions in which it would be embedded as the flip side of the problems of low growth, poverty and shortage of renewable resources. In the 1980s, around two-thirds of Indian industry was freed from output and price controls.
First recognised by South Korea and Singapore, the concept of concentric circles of influence and prosperity is today echoed in PM Manmohan Singh?s Cepa stance as also in negotiations with Japan and Malaysia. Trade, investment and freer flows of resources are the centre of these agreements but so is technological cooperation. Also, out of the nine strategic partnerships India has, six are in Asia (Vietnam, Indonesia, Japan, South Korea, Australia and China).
India pursues three objectives: 1) stability on the reforms front, 2) improving global and national architecture for deepening financial markets for inclusive growth, and 3) linking these two to trade policy. Phased reforms protected us from the wild swings of global financial markets. When the G20 admonished India for not reforming fast enough, it wanted the rules to be clear but the paths to be flexible. But India?s focus has been the harmonisation of financial rules with the development process, a stance that informs its interventions in the G20 as also the WTO. South Korea has picked up this theme and is sponsoring it at the Seoul meetings.
According to its spokesperson, India is using maximum flexibility and creativity so as to leverage the international environment for its domestic economic transformation. It is increasingly integrating knowledge-based initiatives, science and technology and business in its goals. Besides, given the nature of new global challenges, deployment of soft power assets and involvement of civil society are becoming as important as hard power to ?win the peace?. As Sonia Gandhi put it, ?India at the G20 constantly reinvents the art of following its own interests and championing the growth lobby as two sides of the same coin.?
When India entered the G8 meetings after the ?perfect storm?, its concern was to stabilise its growth process. At the peak of the storm, the collapse of two large export sectors?textiles and gems & jewellery?cost the economy a million jobs. In addition, vertical integration by acquisitions was in some difficulty. On the agricultural front, while the Manmohan Singh government reversed the decline of the 1990s, the present agricultural growth rate of a little over 3% is incapable of sustaining India?s high economy level growth. Like China, India is currently a net importer of food and agricultural products. The country is also subsidising imports to protect the food baskets of its vulnerable population. Sonia Gandhi?s larger socio-political contribution is to insist that in a fast-growing economy, a national rural employment guarantee scheme already implemented and a food security programme underway are social underpinnings to the politics of commitment to the common man.
While most countries are being mildly protectionist in the stimulus period to protect domestic jobs and output, India has slashed tariffs and subsidised agricultural imports. It is clearly in the country?s interest that the countries from whom it imports do not follow distortionary policies. Economists like me have argued for mild tariffs on agricultural imports to protect agricultural incomes and for incentives for domestic production. But the government?s focus on food inflation against the backdrop of a roaring economy does not permit such nuanced policies.
At the G20 meet, India will also carry forward its new stance on nuclear power and the more aggressive intellectual contribution it made at the Copenhagen summit. On agriculture, it can be expected to pitch for reform of the global system. The PM?s emphasis on energy and food security at the Brics meeting in Brazil was not just verbiage. These are going to be India?s sustained concerns at the high table.
Having outlined the larger processes in which India?s agricultural trade interests stand out, it is important to recognise that permanent interests don?t change radically and India will push the stand it has developed since Cancun and Doha. It will increasingly agree to place non-tariff interventions in the negotiation basket. But it will probably not compromise the stance that public support to infrastructure development?including markets, communication and agro-processing investments?should not be counted for AMS.
India is going through a renaissance of forms in agriculture, via SHGs, producer companies of farmers, cooperatives, etc. The newer strategies its agricultural policymakers have developed here are largely in the PPP mold, but these do require hand-holding by the State. Global negotiations will have to support these initiatives, seen as important for widespread agricultural and rural development. This would be India?s ?livelihood concern?.
?The author is a former Union minister