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India Gains Global Muscles Double ‘Sorpaso’: The World’s Fifth Economy and the Most Populous Country on the Planet

It’s time for India. The diplomatic double game that its prime minister, Narendra Modi, has managed to avoid condemning Russia for its invasion of Ukraine and standing by Western sanctions against Moscow. Also in its regional space, where New Delhi has for years pursued geostrategic alliances with China in the BRICS club (Brazil, Russia, India, China and South Africa) and concluded the Indo-Pacific Treaty with the US, Japan and dozens of other Asian countries. High-income countries – South Korea, Australia, New Zealand or Singapore – and other emerging markets. The Indo-Pacific Treaty establishes a customs union to facilitate trade and investment, which accounts for 40% of world GDP and from which the Chinese giant is deliberately excluded.

Modi’s Hindu nationalism is the architect of this ever-complex game of shifting balances and loyalties, which has given India greater international muscle. “In recent years, the US, Russia and China have come to India’s court to try to take away strategic advantages from their adversaries,” explains Derek Grossman, a defense analyst at the Rand Corporation. analytical center The most influential in the US, funded by the Pentagon and the CIA, and specialized in the Indo-Pacific region.

According to him, India is facing its great historical opportunity. “This is an ideal moment for him to assert and strengthen his status as an independent superpower in the BRICS and G-20, challenged by the commitment to shift the world order towards a multipolar system and use it strategically in his rotating presidency.” to receive permanent membership in the UN Security Council,” Grossman explains in a recent analysis Foreign Policy.

The Biden administration has restored India’s favored nation status in its diplomatic strategy. In the commercial sphere, with its integration into the Indo-Pacific space and the geopolitical order, as Delhi is also part of the four-way dialogue known as the Quadrilateral, along with the US, Australia and Japan. “Nobody in the Big Ten doubts that India has become the most important partner of the US,” Grossman emphasizes.

At first, the US president called Delhi’s promise to carry out Western repression against the Kremlin “something unstable”. “There was a change in tone,” Grossman explained, with Biden and Modi hailing an alliance “that is one of the most intense on earth,” according to the Democratic leader. The deal involves a mild condemnation of Moscow in exchange for preferential oil and gas flows from the Kremlin and the purchase of military equipment that the US will provide in the coming years. The White House is considering giving Delhi a $500 million funding line.

There is a widespread view in the West that India “has every right to pursue pragmatic, multilateral and independent diplomacy” while adding nuance to its historic relationship with Russia and long-standing rivalry with China, Grossman says. India’s foreign policy is now leaning more towards the American side after the tumultuous rule of Donald Trump.

A leap to the global economic elite

India has additional chevrons to stake its new place in today’s Cold War re-enactment. In economic order, as it was recently recognized by the International Monetary Fund as the fifth largest global GDP, with a market value, at current prices, of $3.468 trillion. It was in this autumn’s half-yearly review, and it left a warning to seafarers: it is outpacing the UK and a long way from overtaking the other two major industrialized nations of the G-7 and G-7 partner Germany. 4 trillion and Japan, with 4.3, although it is still very far from the countries fighting for the global scepter: the USA and China.

The outlook of its finance minister, Nirmala Sitharaman, is that India will be the world’s third largest economy “within ten or fifteen years”; The diagnosis is shared by professional services firms such as PwC, which has been predicting this surge in Delhi since 2014. For the Indian economic architect, the horizon of the 1930s would witness this double overtaking – in Germany and Japan – thanks to “deep geostrategic ties”. That he’s faking it with the White House.” He said this in mid-November at the ninth meeting of the US-India Economic and Financial Partnership in the presence of US Treasury counterpart Janet Yellen. Sitharaman highlighted the collusion between Modi and US President Joe Biden on issues such as the complex situation of global markets, finance and economy, harmonization of aspects of transnational taxation, resilience of value chains or security of raw material supply. All the issues that will take multilateral sides during India’s presidency of the G-20 in 2023.

However, Morgan Stanley believes that India will be the third power in 2027 due to the triple trend established in the country and which combines the use of global displacement process, advances in digitalization and energy transition. “By 2031, India’s GDP could double from the current $3.5 trillion to $7.5 trillion,” they predict in their report. India’s expected economic boom. With a global export quota that will also double – especially due to the progress of manufacturing in GDP, in which it will contribute 21% of its productive capacity in 2031, and in the stock market, its BSE index, which will grow by about 11% annually until it reaches 10 trillion dollars in capitalization at the beginning of the next decade.

For Modi, India’s transformation into a global power is “a matter of aspiration” as a society he inaugurated eight years ago when he came to power after his Bharatiya Janata Party’s 2014 election victory. Since then he has continued to work. A strategy to upgrade the infrastructure network with measures to attract foreign capital and reconcile with domestic business, to create an adequate climate for doing business.

But there are more symbols of India’s global rise. As his attempt to create a financial hub that competes with Singapore or Dubai. Gujarat International Finance has several tens of thousands of employees from investment firms and banks such as JP Morgan, HSBC and technology companies. This is the Indian state where Modi was born, where a huge office complex between its capital Gandhinagar and its main city Ahmedabad handles a $33 billion business.

The Indian executive wants this business pole to become a free market oasis with fiscal and financial advantages. This is an opportunity – they say Economist– when the world needs an economic engine amid China’s shutdown over its Covid-zero policy and strains in its banking and real estate systems. India appears to be “set up and ready to start its business”.

Factor in the most populous nation on the planet

At the same time, on April 14, 2023, India will officially become the most populous country in the world, according to the United Nations, demoting China to second place. There is another big one surprisedThe Italian term means to overtake. India will continue to have a census of 1,425,775 million, when in 1750, before the Industrial Revolution, and without a single country, it had 200 million.

The population factor is another element in India’s curriculum for securing its seat on the UN Security Council, apart from its acknowledged access to the power club with its nuclear arsenal. It is necessary for Modi to solve this anomaly. Although only one-sixth the size of China, India’s market will contribute more than one-sixth of the growth in the global working-age population (15-64) between 2022 and 2050. In contrast, China’s demographic index has been declining for ten years. During which the census of working-age citizens peaked, with an average age of 51 by mid-century, two years longer than today.

This is the result of fruitless efforts to reduce the birthrate in India, despite being the first country to implement family planning on a national scale. Even when the Emergency declared by Indira Gandhi in 1975-1977, massive sterilization campaigns were used, which was the reason for her term in the elections. Prosperity and productivity, key elements for China, depend on its young population. This is an aspect that leaves room for maneuver, as less than half of India’s adult population participates in its labor market, compared to the two-thirds who are involved in the formal workforce at the Chinese giant.

Source: El Diario





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