December 22, 2010

Europe in Indian Strategy

My working paper on Europe in Indian grand strategy was presented at the Institute for Defence Studies and Analyses (IDSA) on December 22, 2010. The full text of the paper can be found here (PDF). Below is the text of my presentation as prepared for delivery:

Thank you, Wing Commander Krishnappa, Mr. Sisodia and IDSA for inviting me to speak here today. IDSA has always loomed large in my consciousness so it is very humbling to be saying a few words before all of you today.

At the outset, I should make clear that Europe is declining as a foreign policy priority for India and it is, in some sense, surprising that it is even being discussed at today's seminar. Longstanding historical linkages – associated with Europe’s colonial presence on the subcontinent – are gradually losing their relevance. Europe is certainly getting far less attention diplomatically. David Cameron’s comments on Pakistan and Carla Bruni’s presence drew the most public attention during recent summits with Britain and France, respectively. Similar summits with Germany and the EU were overshadowed by visits by Barack Obama, Wen Jiabao, and Dmitry Medvedev over the past several weeks. Most survey studies of Indian foreign policy and grand strategy – such as the recent book by Admiral Raja Menon and Dr. Rajiv Kumar - make Europe a low priority. As I recall, there is only half a page dedicated to Europe in that particular book. There is some irony in all this, as it was attempts to forge the link between Europe and India in the 15th century that provided the catalyst for globalization.

While largely justified – and I will get into why that is later – the growing distance between Europe and India in relative terms is at one level surprising. Many would be surprised to know, for example, that the EU as a single entity is India’s largest trade partner: the most recent Government of India figure for bilateral commerce is 74 billion USD, which is 16% of India’s total trade, although that figure is now a year or two old. This number is likely to be surpassed by trade with China soon, but it is not at all insignificant. Europe is also, rather remarkably, a destination of one-fifth of Indian exports.

Another reason to pay attention: Britain and France, and to a lesser degree Germany, Sweden and Italy, are important defense suppliers to India’s armed forces. To list just a few major platforms sourced from Europe, they include Mirage 2000s, Jaguars, Hawk trainers, Aerospatiale helicopters, HDW submarines, Scorpenes, the INS Viraat, and Harrier jets. Europe benefits by providing India access to high technologies with few qualms about export to India, and without the political baggage associated still with American suppliers. On the nuclear front, the European states – led by the French – opposed sanctions against India after the 1998 tests, and urged the U.S. to lift sanctions as soon as possible.

Europe is home to a large Indian diaspora, mostly in Britain, but one that is also half a million strong on the continent. This number is growing, if slowly. Looking ahead, Europe will remain one of the four major concentrations of power in the international system, along with the United Staets, China and India based on its population, its market and its economic infrastructure. Relations with Europe offer India leverage with which to optimize its dealings with other powers.

Furthermore, India and Europe appear to be – at least theoretically – complementary economies: India’s burgeoning market, low costs, service-led growth and demographic dividend complement Europe’s technological aptitude, high standards of living, fiscal inflexibility and shrinking workforce. India and Europe share similar concerns including sub-national governance, the treatment of minority groups, and radical Islamist terror. Collectively, Europe mirrors India’s federal structure, with culturally and linguistically distinct entities. There is also the question of values: Europe, like India, is democratic, secular and multicultural, even though there are differences in how these concepts are interpreted and perceived. Finally, Europe and India not only do not promote competing ideologies, they do not have overlapping realms of influence, as India has with China and Europe has with Turkey and Russia.

Despite all of the realities and opportunities that I have listed, why haven’t India and Europe forged a closer relationship? I like to think of the existing challenges and limitations in four baskets: economic, politico-military, socio-cultural, and existential.

The economic dimension is usually heralded as the most successful, but the large trade figures belie concerns. India is only ninth among EU’s trade partners, behind South Korea. Trade with India is one-sixth of Europe’s trade with China. Europe’s share of India’s commercial mix has declined recently in favor of China, other Asian economies, and the Gulf: in the 1990s, the EU accounted for over a quarter of India’s trade. More worryingly, trade in services is far below goods, and rather unusually, Europe is a net exporter of services to India. Talk about not taking advantage of outsourcing! Finally, two way investment has always been low, but has dropped considerably in the past two years with the great financial crisis.

Moving on to the politico-military dimension: despite robust defense trade, Europe has been weakened by competition amongst European suppliers, technological disadvantages vis-à-vis the United States, rising costs, and the lack of strategic allure. In the multi-billion dollar MMRCA competition that many of us are following so closely, the Eurofighter Typhoon is up against two other European manufacturers: Dassault and Saab. Further, European defense suppliers have always had a whiff of scandal associated with them. Submarine manufacturer HDW was blacklisted after a kickback scandal. I need not elaborate upon Bofors.

A further problem is Europe’s evolution towards a post-heroic society, which reveals itself in its reluctance to fight, deploy and maintain a troop presence in places such as Afghanistan. This is in many respects rather unfair, given India’s own reluctance to use military force outside immediate threats to its national security. A further complication is the question of whom India chooses to partner with. Should it be working with individual countries, NATO or the nascent EU rapid reaction force? The Europeans themselves appear somewhat confused on this score.

A number of common security challenges are not addressed. Iran is considered both by European and Indian strategists to be part of their extended neighborhoods but there is little dialogue on the issue. While there is cooperation on anti-piracy there is not very much coordination. Counter-narcortics is also an issue of concern: most of the heroin produced and transported through India is destined for Europe. Finally, I would like to emphasize global governance competition: India’s seats at the institutional high tables is likely to come at Europe’s expense. Four of the G7 were European countries, while only five seats in the G20 are. India’s permanent seat on the UN Security Council, if it is ever to be realised, will likely come at Europe’s expense.

Briefly, I want to touch upon the socio-cultural dimension. This aspect of relations suffers relative to India’s relations with the U.S. by an absence of robust people-to-people ties. Public opinion in India shows general apathy towards Europe and a low opinion of its future. Europe is not seen as a land of opportunity. Finally, there are existential problems, as India and Europe move in opposite directions. In recent years, India has embraced or reaffirmed sovereignty, nuclear deterrence, balance of power, and a distrust of permanent alliances, just as Europe appears to be abandoning these principles. Instead Europe has invested in supranationalism: establishing the Schengen area, the European Central Bank, the Euro, the Lisbon Treaty, the European parliament, and the office of the High Representative.

These changes have real political and policy outcomes. Differences at the Copenhagen climate summit were in large part over different approaches to sovereignty. There is Europe’s unhelpful emphasis on human rights. Its parliament's condemnation of India on Jammu & Kashmir showed Europe’s tone deafness, coming during a period of rapprochement between India and Pakistan. Another example: smaller European countries’ reluctance to back India at the Nuclear Suppliers Group.

I have outlined the present-day realities, the opportunities and the seemingly intractable challenges. There are a few lessons we can derive. I remain cautiously optimistic, because both India and Europe have a history of rising over deep-seated differences: Europe with China, and India with the United States.

First, Europe offers useful lessons – in many cases more than the U.S. – on matters of governance. Two, on the matter of global governance competition, there is an impetus for India to encourage European unanimity – if not unity – so the European states can consolidate their seats and make room for India on various high tables. European states must also be made to consider that sacrificing their voice for democratic India’s would considerably strengthen the very institutions they have invested so much in over the years. Finally – although we have just heard a warning against describing anything as a litmus test of India’s grand strategy – I would venture that Europe offers a litmus test for Indian grand strategy. Unlike other relationships with major centres of power, India will have to be proactive in outlining what it wants, and how to use Europe to achieve those ends. This will require an investment here at home in understanding Europe better, proactive engagement, and – most importantly – a focus on socio-cultural factors that have the ability to strengthen the overall relationship in the long run. Thank you.