Category Archives: Research
Big Power, Superpower, Selfish Power: No Saints, Only Sinners
Let me extend a warm welcome to all of you on behalf of the organisers, the Ministry of Foreign Affairs and International Cooperation of Rwanda, the Rwanda Convention Bureau, ORF America—a new institution in Washington DC that we built during the pandemic—and, of course, ORF India. We are delighted to be here with all of you.
Personally, I am thrilled to be back in Rwanda. I can actually share with you that the number one item on my to-do list, once the pandemic allowed us to travel, was coming back to Kigali. It is immensely satisfying to reconnect with everybody again. I hope over the next few days, we will exchange notes, renew friendships, and shape new partnerships.
By way of introduction to what we plan to do over the next two and a half days, I thought I could take a few notes out of my pandemic diary. On how I was observing the world and assessing it even as we were isolated, quarantined, separated, and sometimes hopeless and helpless, I found that there were three questions that I grappled with.
First and foremost, we must question global governance as it exists today—its institutions and its leadership. When the pandemic hit, if we are really honest, all of us in this room were left to our own devices. There was no cavalry coming to save us, we had to do it ourselves. At the peak of the pandemic, it was every human for themselves. Countries were isolated, societies were quarantined, and global governance was missing in action. We must promise ourselves that next time we will do better and efforts towards that must start today.
What is the point of investing in global institutions, if not for their reassuring presence during these times? I am not suggesting that we need to do away with these institutions. In fact, I urge all of us to rethink, re-invest, and reshape how they work, who they serve, and for what purpose they are designed. And that must be something high on our agenda, as thinkers, as practitioners of policy, and as global citizens. So the quality of global governance has to be the first question we respond to.
We all know that the pandemic was a great leveler. There were no big powers, there were no superpowers, there were no great powers. There were selfish powers who dominated the world. New York, London, Paris, Cape Town, Delhi, name the city, everyone was devastated by the pandemic. Higher spending on health care, greater medical systems, better facilities, all amounted to nothing. We must, therefore, re-think our health architecture—programmes that are meant to preserve lives and protect ourselves must be re-examined. Countries that had spent billions of dollars on building medical capabilities were struggling to respond, as were much poorer nations. Perhaps, instead of spending money on prestige medical projects, a more equitable distribution could have prevented the spread of the virus in geographies that were underprepared and had low infrastructure capabilities.
The second clear reality, or rather virtual reality, was the digitalisation of our societies. No policy by any political leader, no matter how charismatic, could have created the rate of digitalisation that the pandemic was able to do. It was outstanding and astounding at the same time. Outstanding, because we were able to connect; we were able to earn a livelihood; we were able to remain engaged. We were able to, in some sense, continue as a community, as a society. Astounding, simply because the institutions to protect these digital spaces, which are now so precious, do not exist.
We saw the digitalisation of everything. Individuals exist online, yet they live offline. They connect to their near and dear ones offline, but communities are built online. Countries are now digital nations yet, we see wars crop up to defend lines on a map time and again.
We must ask: Have our politics and policies realigned themselves to the emergence of this digital society? Are we recognising the digital arena as an independent domain, akin to a new geography, that requires its own set of rules, principles, ethics, and governance? Or are we still seeing this as an instrument attached to our real world? Depending on how we assess our digital reality, we will come up with responses that may be sub-optimal or ambitious…or perhaps the ones that are most appropriate. This is a debate we must have about the digital societies that the pandemic has, in many ways, incubated.
Next, we are witnessing a reversal to parochialism, tribalism, and selfish behaviour. We have seen nations cannibalise and weaponise production capabilities for their own selfish requirements, hijack medical shipments and more. There were again no big powers or super powers—just selfish ones. There were no saints, only shades of sinners, and all of us were implicated by these actions. This self-serving behaviour was, in turn, endorsed by national media and demanded by electorates on the streets; which begs the question: How do we rectify this?
We have also witnessed a recession of globalism. We are more interconnected, but we trust less, we care less. We are less empathetic. We can’t wish away the rise of these emotions, sub-nationalist and nationalist. But we also can’t ignore the benefits and the protection that an interconnected world provides us. Who are the next generation of leaders who will rebuild globalisation in a different format?
We don’t need to invest in perverse dependencies. What we need is smart, interconnected resilience. The globalisation of tomorrow must be very different to the texture of yesterday. I must reiterate the point I began with: Community is cavalry.
When it comes to our development needs—education, health, skills, and other social sectors, the pandemic has pushed us into a do-it-yourself mode. While we must seek partnerships, we must build networks, and we must create relationships, we must first build ourselves and our capacities. Sharing individual journeys, group experiences, and learnings of countries is one way to strengthen this process of investing in ourselves and our community.
The Kigali Global Dialogue is an attempt to build that community. We are not going to give you the silver bullet to solve all problems. Nor will the dialogue offer a prescription for a better tomorrow. But we are here to be your fellow humans on a journey that we will undertake together.
May you all enjoy the ride over the next two and a half days, and may we discover important lessons on the way. Thank you for joining us at this Dialogue.
Australia-India need unprecedented collaboration to fight Chinese influence: ORF President Samir Saran
Interview originally published here.
The President of Observer Research Foundation (ORF), one of India’s premier think tanks, Samir Saran, was recently in Australia.
In an exclusive interview with The Australia Today, Mr Saran outlined the importance of the Australia-India bilateral relationship and how crucial this relationship is going to be from a strategic and economic point of view.
Q1) How important is the India-Australia relationship going to be globally and for the Indo-Pacific region from a security point of view?
Mr Saran: India views Australia as one of its most important partners in the world. The relationship has transformed in less than a decade. Today, the two countries are exploring opportunities to work shoulder-to-shoulder on new opportunities to tackle challenges that confront Asia and the world. The partnership has been catalysed by shared concerns about China and a shared responsibility to ensure a peaceful and inclusive Indo-Pacific by partnering closely with like-minded countries in the region.
Q2) How do you see bilateral trade between the two countries going forward, is it likely to substantially increase after the trade agreement?
Mr Saran: The signing of the interim agreement has come at a time when the trade momentum between both the countries is on a high. The latest data by the Ministry of Commerce and Industry of India, released in April 2022, show 104.8% year-on-year growth in Indian exports to Australia and 99.5% year-on-year growth in Australian imports to India. The completion of the FTA would definitely boost volumes of trade between the two countries—both expect trade in goods to double in five years to the US $50 billion. Australia’s aim is to make India the third-largest destination in Asia for Australian investment and also one of its top three export markets by 2035.
Q3) How important is it for Australia to diversify its international trade and reduce its exposure to China?
Mr Saran: It is extremely important. As one of the developed world’s most China-dependent economies, Australia will always be vulnerable in case of deterioration in bilateral ties. By pushing for answers on the origin of the pandemic, Australia has already angered Beijing. After being at the receiving end of Beijing’s trade weaponisation, it is extremely significant for Australia to reduce its perverse dependence on China by diversifying its export markets. Australia and others also need to invest more in trade diversification, and supply chain resilience and are conscious of the geopolitical risks.
Q4) How important is it for Australia to increase its economic engagement with India specifically given the implications not just for geoeconomics but also geopolitics?
Mr Saran: The broader trade and technology agenda is closely linked to and implicated by politics. This geopolitical convergence in the Indo-Pacific is also driving the current upward trajectory in the economic relations between India and Australia. Australia realises that even as it seeks to respond to the increase in Chinese influence within Pacific Island countries, India is staving off the overbearing presence of the dragon in South Asia. Instead of relying solely on the United States, it is time for India and Australia to increase their economic engagement and build their own capabilities to push back against Chinese expansiveness. They have obvious overlapping interests in the region and a clear motivation to make this happen.
Q5) How important is Australia going to be for India from a trade and security point of view?
Mr Saran: As the first bilateral trade agreement of India with a developed country in the last decade, this FTA with Australia is extremely important. as India is not part of any significant regional or free-trade bloc. Apart from eliminating or lowering tariffs on both sides, this FTA positively influences other ongoing bilateral trade negotiations that India has with Canada, the EU and the UK.
As mentioned earlier, due to an overlap in the Indo-Pacific regional visions of the two countries and the escalating competition between US-China, India sees it important for Australia to bolster its security capacities through enhanced defence acquisitions and spending, as well as by strengthening existing defence cooperation. India and Australia, by investing in their own security and economy, are offering the other greater ability to manage and negotiate the changing political and economic landscape in Asia.
Q6) Are there any specific areas where you see the potential for increased engagement that require more attention?
Mr Saran: There are four areas where there’s potential for increased engagement. First is political – both India’s and Australia’s neighbouring island countries are facing excessive inducements by the CCP to follow the Chinese way of life. We need to realise that dialogue with these island countries is not enough, we need to put money where our mouth is. India and Australia can create an islands initiative, wherein we invest in their technology futures and climate resilience, and offer them better, safer money than what is on offer from the Chinese.
The second is climate – as India transitions to a green economy, Australia can vigorously partner with us. As a country with sophisticated financial institutions, Australia can offer significant inputs in the technology, R&D and innovation space. Australia’s financial institutions can also service the significant Indian appetite for green finance and infrastructure projects.
Third is technology – instead of becoming the B-teams of Silicon Valley, the India-Australia technology partnership could create tech for development, fit for our neighbourhood. This would not only help the ASEAN and island countries, but also the emerging world. India and Australia have the potential to be the A-team of the tech for a development paradigm that serves the next 6 billion that silicon valley does not innovate for.
And finally, diaspora – we need to scale up Australia’s educational and knowledge partnership with India. We need to take Australian institutions to India and offshore the education industry, wherein the former is able to increase its presence and build to-scale education and skilling institutions in India.
7) Do you see Quad as having substance or is it more a symbolic grouping at this stage?
Mr Saran: Quad, as of today, is a limited-purpose partnership that was born out of common concern about Chinese activities. At this stage, the Quad is beginning to become more ambitious and is seeking to shape the development and technology pathways the region treads on.
A quad must consider building more substance through institutionalisation and by delivering on specific projects in the Indo-Pacific region.
What will India’s G20 presidency focus on?
India’s presidency must leave the grouping with the agility and energy to respond to new realities, and it must create a future-ready multilateralism through a novel and robust institutional architecture
India takes over the presidency of the group in December. To live up to the potential of this opportunity, it must choose a policy direction to focus on continuity, incorporate green and digital transitions, and recognise the realities of a post-pandemic world
India’s presidency of the G20 grouping next year — arguably the sole remaining effective forum for global governance — presents an enormous opportunity to accelerate sustainable growth within India, in the emerging world, and beyond.
For India’s presidency to live up to this potential, it must recognise the constraints of the grouping and the crises — from the pandemic to the Ukraine war — that it must confront. But there should also be a clear understanding of the levers that a G20 president has to affect global policy action.
Next year, the troika of the preceding, current, and succeeding presidents will be three developing countries: Indonesia, India, and Brazil. This fortuitous alignment must inform India’s strategy as it designs its G20 agenda.
Three broad principles should underline India’s planning. First, it must recognise the value of the emerging-world troika and choose policy directions that emphasise continuity. Second, it must incorporate the concerns of its dual development transitions — green and digital — into the G20’s agenda. And third, it must recognise the realities of the post-pandemic world and prioritise action on those sectors that have, since 2020, been revealed to be under-capitalised.
India’s agenda must resonate beyond the one year it holds the presidency. This requires it to set its priorities alongside those of the two other members of the troika. The G20 under Indonesia has articulated three priority issues — global health architecture, digital transformation, and sustainable energy transition. Reinterpreting these will be key to building continuity, and, thus, sustained action. It is also important to keep in mind that having too many priorities is the same as having none at all. Indeed, India must prevent the G20 from suffering — as other multilateral forums such as the World Trade Organization do — from an over-expansion of its mandate.
Two major transformations will define our economies and societies going forward: Digital transition and green transition. Both are key to addressing the development challenge as well. These transitions are the meeting point of geopolitical and youth aspirations that will dictate our political, economic and social well-being.
On the digital front, India, to a large extent, has been a first mover. India’s youth aspirations are digital-first; the government has responded, and the digital economy is at the centre of its aim for a $5-trillion economy by the second half of the 2020s. The Observer Research Foundation’s youth survey on tech policy found that 83% of respondents want India to adopt a policy that prioritises its domestic technology industry. At the same time, 80% welcome greater cooperation with international partners on technology.
Clearly, a fine balance is needed where technological multilateralism does not come at the cost of developing countries’ needs. The Think Tank 20 (T20) engagement process has identified the internet as a basic right and technology access as vital to reducing inequalities. Cooperation at the G20 would be a good testing ground for pioneering tech regulation that balances the interests of the private sector with sovereignty and the security needs of States, and the growth demands of the economy.
India’s G20 must also recognise the unprecedented, carbon-constrained nature of future growth. Arguments for a green transition can no longer be limited to the moral high ground of saving the planet. A commitment on sustainable consumption must be placed front and centre. International financial regulation and the mandates of multilateral development banks must also ensure that adequate finance incentivises a business case for rapid change with adequate global flows subpoenaed for the developing world. Can the Indian presidency help to architect this new global arrangement?
A third focus must necessarily be the post-pandemic world order. Covid-19 has proved that health, nutrition, and livelihoods all remain fragile despite commitments made under Agenda 2030. The United Nations has warned that the Covid crisis could result in a lost decade for development. It has sharpened inequalities and widened development gaps. The United Nations International Children’s Emergency Fund has also cautioned that the pandemic could lead to a “lost generation” of children in terms of education, nutrition, and overall well-being. These conversations have become more complex due to the crisis in Ukraine. The weaponisation of trade and the international banking system during this war has exacerbated uncertainties. The surge in prices of energy and essential staple foods has added a disturbing dimension to an already stressed economic recovery. By putting nutrition, food security, and health at the heart of its G20 agenda, India can ensure the success of the Decade of Action on Sustainable Development. The clincher will be to facilitate greater funding towards these efforts.
India’s presidency is an opportunity to reinvigorate, reinvent and re-centre the multilateral order. The G20 cannot be distracted or undermined by the bilateral relations of specific members, even as we acknowledge the gravity of the humanitarian crisis that is unfolding in Europe. India must leave the G20 with the agility and energy to respond to new realities, and it must create a future-ready multilateralism through a novel and robust institutional architecture.
Raisina Files 2022
In the sixth edition of our flagship annual journal of essays, the Raisina Files, we seek to take stock of where we are as people, communities, and countries. We intend to discuss and clarify responses to challenges that have arisen due to the pandemic, and discover and chart pathways to opportunities in the post-COVID19 world. Our contributors engage with the new war in Europe, and its consequences for the region and the world. Most importantly, the fine minds who have penned the essays that follow, seek to describe what lies ahead, how it will be arranged, who will shape it, and who will likely benefit from what unfolds.
Raisina Files 2022 mirrors the theme of this year’s Raisina Dialogue, “Terra Nova: Impassioned, Impatient, and Imperilled.” We have identified six pillars and areas of discussion within this overarching theme to engage with critically—Rethinking Democracy: Trade, Tech, and Ideology; End of Multilateralism: A Networked Global Order?; Water Caucuses: Turbulent Tides in the Indo-Pacific; Communities Inc.: First Responders to Health, Development, and Planet; Achieving Green Transitions: Common Imperative, Diverging Realities; and Samson vs Goliath: The Persistent and Relentless Tech Wars. Together, these six pillars of the Raisina Dialogue capture the multitude of conversations, opportunities, and anxieties countries engage and grapple with.
In this volume:
Editors: Samir Saran and Anahita Khanna
- The DragonBear: Putin’s Choices | Velina Tchakarova
- Forging China-Resistant Supplier Compacts | Jeffrey Jeb Nadaner
- Democracy, Technology, Geopolitics | Sameer Patil and Vivek Mishra
- Materials That Matter | Andreas Kuehn
- Scripting a Third Way: The Importance of EU-India Partnership | Amrita Narlikar
- Emerging Domains of Conflict in the 21st Century| Lydia Kostopoulos
- Advancing Trade Governance – Only for Democracies? | Renato G. Flôres Jr.
- The World in Disarray: Is This the End of Multilateralism for Trade? | Stormy-Annika Mildner
- Anticipate, Reform, and Elevate: Looking Toward W20 India 2023 | Erin Watson-Lynn
- The Pandemic at 24 Months | Sridhar Venkatapuram
- The Season of Caucuses: QUAD, AUKUS, and the Exclusive-Inclusive Duality of Indo-Pacific Asia | Rory Medcalf
- Oceanic Choices: India, Japan, and the Dragon’s Fire: How does the QUAD Work? | Satoru Nagao
- Diverging US and Indian Approaches to Europe: The Problem of Ukraine | S. Paul Kapur
- India’s Unicorn Step-Function Growth Signals the Emergence of its Innovation Ecosystem | Nisha Holla
- Exploring the Inequities of Climate Finance | Mannat Jaspal and Terri B. Chapman
- Enabling the Green Transition to be a Just Transition | Nuvodita Singh and Akshima Ghate
- Meta-Soft Power: Flipping the Scales Between Art & Culture | Nicolò Andreula and Stefania Petruzzelli
All roads connect Delhi and Brussels
Co-Authored with Amrita Narlikar
Our text of ancient fables, the Panchatantra, speaks of “natural allies”. If there are ever natural allies in politics, the European Union (EU) and India should exemplify this relationship. Our cultural exchanges date back to ancient times; our languages have common roots; our borders are closer than ever via a human bridge that connects us: There are millions of Indians in the Middle East, and millions from the Middle East in Europe. Europe and India are a geographical continuum. And both the EU and India— “the world’s largest democracies”—face shared threats and challenges. All roads must now connect Delhi and Brussels.
Here, we lay out a map to address three key challenges: The green transition, the digital transformation, and the preservation of our shared geopolitical landscape. On all three issues, direct and close cooperation between the EU and India will not only be vital for these two major powers and their people—but also for the world at large.
Green Transition
To address climate change, the EU and its members have been upping their domestic game. The European Green Deal is only one amongst several key initiatives that illustrate the seriousness with which the EU is addressing the existential threat of climate change. At the same time, there is much angst in Europe that these efforts will not suffice unless they are matched by China and India. While the concerns are understandable, a narrative framed in terms of “what will become of the world if every Indian has a car” is patronising and misplaced, especially when one compares the per capita fossil consumption in India to the EU members. In any case, specifically with respect to India, the EU is pushing through an open door on the issue of addressing climate change. India has led the way in international initiatives on the issue of clean energy, for instance, by creating the International Solar Alliance with France. India’s commitment to protecting the environment, moreover, does not stem from recent pressure exercised by Greta Thunberg or Fridays for Future. Contra western anthropocentrism in which activists advocate climate change mitigation for “our children’s future”, Indian philosophy teaches us that the planet belongs to humans, plants, animals, and all living beings. There are, therefore, deep-rooted and inclusive reasons for Indians to be committed to protecting the planet. This commitment should not be doubted. Instead, the EU needs to find ways to invest in this Indian cause and co-create solutions for our common future.
The European Green Deal is only one amongst several key initiatives that illustrate the seriousness with which the EU is addressing the existential threat of climate change.
To achieve this, we need actions and not words. It has taken a full-blown war in the heart of Europe for Germany to recognise the risks of over-dependence on Russia for energy purposes; diversification is proving to be far slower and more complicated than many would like. In light of this experience, it is perhaps even more unreasonable than before to demand that India “phase out” coal at the click of a finger. The EU will have to put its money where its mouth is if it is serious about addressing the global problem of climate change. The Carbon Border Adjustment Mechanism, for example, should be more than a “poverty tax”, as it is seen in India; it should be a tool to finance and incentivise the green transition in globally integrated sectors in the emerging world. Technologies vital to low-carbon growth will need to be co-created and co-owned by Europe and partners like India. European capital must be given a nudge to flow into climate-conscious investment in the emerging world. It is up to the EU to make sure that India’s efforts pay off—through significant European financing in key sectors, via public-private partnerships.
Digital Transformation
The EU is leading the way in setting people-centred standards on digital governance via GDPR. India’s Aadhaar Card scheme has shown the pioneering role that digitalisation can play in empowering the poor and facilitating development. There are also already several worrying examples of the pernicious effects of digital technology: Surveillance of local populations by authoritarian states, as well as the manipulation and control of infrastructure and security systems by external actors. To preserve the individual liberties of their people, and strengthen digital sovereignty, European and Indian cooperation will be key.
Research collaborations on dual-use technology, public-private partnerships for implementation and marketing of these innovations, and working jointly and through like-minded coalitions to establish rules for data governance and cyber-security are essential.
These two democratic powers will also be well-served to collaborate on diversifying away from their dependence on China, for e.g., on 5G technology and infrastructure development. Any trade agreement between the EU and India should prioritise this key consideration. Research collaborations on dual-use technology, public-private partnerships for implementation and marketing of these innovations, and working jointly and through like-minded coalitions to establish rules for data governance and cyber-security are essential. Neither the EU nor India can get left behind in a game that is dominated by the boardrooms in the US and party headquarters in China. India and the EU need to enter into a technology partnership that allows for all of this, and for ensuring reliable and integrated supply chains.
Shared geopolitical landscape
Our shared geopolitical landscape—extending beyond geographical proximities and including the Indo-Pacific—has been under extreme stress in recent years. The EU has a war triggered by Russia on its borders; India and its neighbours have had to put up with Chinese adventurism on the Himalayas and in their maritime neighbourhood.
Research collaborations on dual-use technology, public-private partnerships for implementation and marketing of these innovations, and working jointly and through like-minded coalitions to establish rules for data governance and cyber-security are essential.
This is a time for both the EU and India to be working together to help restore balance in the region. The EU will need to jump off the fence with respect to China; the European mantra of “partner, competitor, rival” is highly inadequate in dealing with a China that has signed a “no-limits” partnership with Russia. India will also need to rethink its own dependencies. The two democracies have now very real incentives to develop closer economic and military ties.
Sanctimonious lectures about morality will need to be replaced by a shared empathy of the like-minded. And all this will require the use of not only Europe’s favourite tool of “soft power”, but also the use of hard power through infrastructure projects, green investment, and military cooperation. Re-aligning their economic and security cooperation with each other will enable both the EU and India to stand up for the values that they both hold dear: Democracy and pluralism.
The world is in flux. Self-reliance is vital
Three contemporary developments have challenged India’s engagement with the world and its security concerns in the past 24 months. The first was the decision by China’s Xi Jinping to pick a line from a map in imagined history and send 100,000 troops and more to alter the current political equation in the Himalayas. This was a whimsical and perverse exertion of power that resulted in a bloody clash and a still continuing face-off between Indian and Chinese troops. Xi’s actions then were no different from Vladimir Putin’s in recent days, both yearning for the expanse of empires past or even mythical. The global reaction, though ostensibly sympathetic to India, was timid when compared to the current aggressive response to a similar Russian effort to change the politics of Europe.
Continuing economic engagement with China and appeasement of the Dragon to the detriment of its partners and allies defined the western world’s response. The differential between geopolitics in Europe and geopolitics in Asia has been underscored again in stark terms. The frenzied media coverage and careless commentary continue to reinforce how values and ethics vary when ethnicity and geography change. This must affect the assessments of the West’s partners in the East.
Next, in August 2021, the world’s mightiest superpower, the United States (US), finalised an unethical and tragic arrangement with a band of terrorists, and deserted Afghanistan overnight. Women rights, individual freedoms and the “values” that were propagated while waging the so-called liberal war against terror, were all discarded in favour of what was expedient. The professors of democracy and the radical Taliban found common cause and sent Afghanistan back to the 1990s. For India, terrorists armed with American weaponry were no longer just a threat scenario but a reality at its door — one it would have to handle by itself.
The differential between geopolitics in Europe and geopolitics in Asia has been underscored again in stark terms. The frenzied media coverage and careless commentary continue to reinforce how values and ethics vary when ethnicity and geography change.
And now, Putin has decided to go one up on Joe Biden and take Europe back to the early 20th century. Russian troops invaded a sovereign country to enforce a political writ driven solely by the desire to preserve Russia’s influence over geographies that increasingly disagree with the politics and propositions of the Kremlin. While Russia’s fears of the purpose and method of the North Atlantic Treaty Organization (NATO)’s expansion must not be discounted, use of force and violation of a country’s sovereignty cannot be acceptable as an expression of disagreement.
The invasion of Ukraine has put India in an unenviable position of choosing between what is right and what it believes is right for itself. India’s tough words on Russian action in its statement at the United Nations Security Council (UNSC), even as it abstained from voting, demonstrated this. Yet this is insufficient for many in the liberal West who seek India to be part of the normative liberal order, as well as of a performative chorus against Russia.
The invasion of Ukraine has put India in an unenviable position of choosing between what is right and what it believes is right for itself.
What is more striking than India’s predictable vote is the mood on the street and views of the commentariat. It seems that the memories of the feeble support on China and the shenanigans in Afghanistan are still fresh.
The US invasion of Iraq in 2003 had triggered loud political debates and voices against India’s then position on American intervention. This time, the convergence across the normally sharp political divide is palpable and must be a moment for reflection for many.
Several questions confront New Delhi. First, does strategic autonomy equal neutrality, or is it the freedom to choose what is best for the country at any given time? Can we disregard growing strategic expectations from partners? What are the dependencies that are being created by our economic and security choices? Which of them are inimical to our interests? And, how can we integrate this aspect as we make choices in a multi-layered world?
Finally, there is a question for the trans-Atlantic order. Its tough line on Russia’s military adventurism, gaming of economic relations, and cyber and information operations have been compelling. Will it hold this line when it comes to China’s actions? Or will the happenings in Asia continue to be appraised through a “dollar”- driven values framework?
Trusted connectivity, diversified sources of materials and components and resilient financial and trading arrangements are no longer buzzwords but a strategic imperative requiring all of India’s consensus, including within its business community, lawmakers and all stakeholders.
But the single most important learning through the pandemic years and the three geopolitical developments that have created turbulence for India is the burial of the post-war assumptions of the century past that undergirded our modern societies and indeed the global project that was born around the same time as India’s Independence.
Between China, the US and now Russia, we have witnessed the weaponisation of everything. Innocuous supply chain components for electronics, minor supplements for medicines, components for vaccine packaging, energy and gas grids, SWIFT system and currency and minerals and sundry materials have all been used for political coercion, waging war, or for undermining others’ interests.
Prime Minister Narendra Modi’s call for Aatmanirbharta (self-reliance) has acquired a new salience and ironically, achieving it requires astute global interlinkages and perhaps even more dense global networks for a country that houses a sixth of humanity. Trusted connectivity, diversified sources of materials and components and resilient financial and trading arrangements are no longer buzzwords but a strategic imperative requiring all of India’s consensus, including within its business community, lawmakers and all stakeholders.
Time to reassess what is good, what is bad, and what is ugly about India’s tech regulations
The emergence of new technologies has digitalised markets, societies and nations. Once perceived as a strength, this proliferation of technology is now also a vulnerability. It has made tech-governance more political and social, and less about the traditional modes of regulation such as permissions, standards and tariffs.
India is among the most technology adept nations, a function of its people’s comfort with IT products and services as well as its late-mover advantage. It must now engage with a spectrum of evolving needs around law and regulation. This is necessary to accelerate population-scale opportunities and address widespread risks.
Three sets of issues emerge here – understanding the nature of technology-linked risks; assessing the challenges to governance; and being imaginative in embracing new modes of regulation.
Three sets of issues emerge here – understanding the nature of technology-linked risks, assessing the challenges to governance, and being imaginative in embracing new modes of regulation.
Let us begin with the risks, which themselves are creations of enhanced democratic access. For example, in roughly two decades India has added over a billion mobile phone subscribers, with over 50 per cent of them now using smartphones. This is transformational and unprecedented.
Improved access is credited with enabling financial inclusion, efficiency in education and healthcare, and fostering local e-commerce as well as global trade. However, a large user base is also a double-edged sword. As a result, corrective interventions need to be nimble and at digital velocity and population scale. Legacy regulation is simply ineffective.
This is best illustrated by problems plaguing social media platforms. A 2021 study found a high rate of social media misinformation in India, and attributed this in part to the country’s higher Internet penetration rate, driven by smart phones. Between June-July 2021 alone, Facebook received 1,504 user complaints in India – with a significant proportion of these related to bullying, harassment or sexually inappropriate content. Concerns are also emerging across other digital ecosystems, such as online gambling and crypto-assets. The mobile phone is a communication device, a crime scene and also an unsafe personal space.
Several state-level laws regulate or entirely prohibit betting and gambling. However, research suggests India is among the top five countries in terms of income potential from online gambling, and that the domestic online casino market may grow by 22 per cent each year. People from several states, such as Maharashtra, Telangana and Karnataka, are among the most frequent visitors to online gambling websites. The market for illegal betting and gambling in India is highly lucrative, with some estimating its value at USD 150 billion.
Offshore gambling websites often channel black money, engage in illicit transactions and launder wealth through financial intermediaries. Their operators are invariably based outside India, which makes it difficult to enforce the writ of the state. Recent investigations by bodies like the Enforcement Directorate have revealed instances of locals being hired to open bank accounts and trade through various online wallets, revealing gaps in due diligence mechanisms.
For the digital economy to flourish, it is important to evolve approaches that help resolve systemic and structural risks. It is time to reassess what is good, what is bad and what is ugly in this new digital landscape. Online gaming and online gambling must not be conflated. Similarly blockchain and sensible DeFi must not be clubbed with predatory crypto-gaming. After all, if we don’t embrace disruptive technology markets through sensible regulation, others will. A failure to capitalise may see India lose key avenues for economic growth and investment. India risk environment will then be shaped by external jurisdictions, some inimical to the country.
For instance, there are approximately 15 million crypto-asset investors in India, with total holdings of INR 400 billion. However, the regulatory and policy uncertainty has compelled crypto-asset entrepreneurs and exchanges to look to operate in more favourable markets. Exchanges such as Cryptokart, Koinex and ZebPay have exited the Indian market. ZebPay, for instance, is now headquartered in Singapore. In late 2021, many crypto-asset founders in India were considering moving their businesses to either the UAE or Singapore.
What we need today is new thinking and a new imagination of the digital world as not merely a virtual extension of the real, but an entirely different paradigm.
By banning cryptocurrencies altogether, nations such as China have missed the bus. India must leverage its position as the world’s third-fastest growing technology hub and seize the opportunity created by Beijing’s command and control ethos that is antithetical to innovation. India can and should become a global norms shaper in tech.
Tech regulation at population scale is akin to writing a new constitution for a digital nation. What we need today is new thinking and a new imagination of the digital world as not merely a virtual extension of the real, but an entirely different paradigm. There needs to be a clear-eyed understanding of what is legal, what is illegal and what may be illegal and yet requires regulations to serve and protect users and citizens.
To use a real-world analogy, since the 1990s, many countries including India have consistently distributed condoms and undertook safety campaigns among sex-workers without legalising prostitution or made available safe syringes to drug users without legalising the act. For governments and regulators, the role is no longer one of a gatekeeper that has the ability to prevent or permit activities online; it is becoming more of an ecosystem shaper and reducer of public bads.
By taxing cryptocurrency assets but not recognising these as legal tender, India has shown some welcome flexibility. It would do well to retain this nimbleness and become a co-curator of relatively safe tech platforms, services and products of the future that respond to Indian jurisdiction rather that off-shore the production of risks along with the rewards.
Samir Saran 