Why everyone is talking about India now

Intellectuals like Markus Lanz and Richard Precht talk about it. International newspapers such as the NZZ and the “Financial Times” report: India is, as the Americans say, “the next big thing”. The economists are hoping for the next kick for the global economy from this giant empire. Meanwhile, politicians dream of having found a new partner in the battle between the great powers against China. What speaks for these high-flying ambitions?

First the facts.

India has a world famous university with the Indian Institute of Technology. It is therefore not surprising that the subcontinent not only has leading companies in the field of IT, but that Indians can also be found at the forefront of tech giants such as Alphabet, Microsoft and IBM. There is no shortage of young people either. With more than 1.4 billion people, India has just overtaken China as the most populous country in the world, and unlike its arch-rival, it is not threatened with an aging population: 40 percent of the population is under 25 years old.

The Indian economy is booming. According to official figures, gross domestic product (GDP) rose by more than nine percentage points last year. The International Monetary Fund (IMF) expects India’s economy to grow by more than six percentage points of GDP in the coming years, making it the strongest growth in the world. The long years of ‘Hindu economic growth’, which mocked the measly state of the subcontinent’s economy, are over.

Politically, too, India seems to be moving in the right direction from a Western perspective. Fearing archenemy China, Prime Minister Narendra Modi’s government is increasingly turning to the United States and is welcomed with open arms by US President Joe Biden. India’s ties to the Quad (Quadrilateral Security Dialogue) – a military alliance that also includes Australia, Japan and the US – have just deepened. India seems increasingly to play the role that France once played under President Charles de Gaulle: a laborious but ultimately reliable partner for the West.

Or not. There are serious doubts about both India’s economic miracle and its supposedly newfound love for the West. Here you are:

What speaks against the Indian economic miracle

Ashoka Mody is an economist who grew up in India and is now a professor at Princeton University in the United States. He recently published the book «India is Broken». In an interview with the NZZ, he justified the obvious title as follows: “In the past 75 years we have not been able to create enough jobs. According to my calculations, India needs about 200 million jobs in the next ten years. That will not work and that is why the economic model has fundamentally failed.”

Mody also does not want to accept the current economic boom. According to the economist, the rapid economic growth of the past year is only a response to the Covid slump and is therefore not sustainable. He sees the reason for this in the appalling school system on the subcontinent. While India may have a world-class technical university, the primary school is in a deplorable state. In the 2009 PISA survey, India came second to last. “The quality of the training is still lousy,” says Mody. “The biggest problem is the teachers. The system is getting more and more corrupt.”

Mody therefore considers the comparison with China completely misplaced, especially because the Middle Kingdom has an excellent primary school. “They are two completely different countries,” says Mody. “China’s material progress is based on the fact that it has succeeded in massively improving public goods. If there is no progress in education, there is no sustainable economic growth. India’s political elite overlooks this.”

What speaks against the statement “India as a partner of the West”.

Meanwhile, Ashley Tellis destroys the geopolitical illusions in “Foreign Affairs” magazine. He works at the Carnegie Endowment for International Peace.

Fear of China could push India closer to the West, Tellis said. But: “Washington’s expectations of India are completely misplaced. India’s relative weakness to China and its physical proximity to the Middle Kingdom will ensure that New Delhi never gets involved in a conflict between the US and Beijing.”

In other words, India is currently only interested in rapprochement with the West out of selfishness. In the long run, New Delhi has a very different goal. It wants to become the leading power in the emerging countries of the South. That is why India refuses to condemn Russia’s war against Ukraine.

Also in «Foreign Affairs», Nirupama Rao, Indian foreign minister between 2009 and 2011, speaks frankly. He describes US and European outrage at Russia’s offensive war as “short-sighted and hypocritical” and emphasizes that his country has no intention of supporting Western sanctions against Russia.

Hopes for a military ally in India against China were also misplaced. “US politicians should be under no illusions about India’s involvement in the Quad,” Rao said. “New Delhi will not play the role of a partner for Washington against Beijing. India plays on both sides in the US-China conflict. It participates in both the US-dominated Quad and the Beijing-led Shanghai Cooperation Organization.”

India will therefore not be included in a Western-led coalition against China and Russia. For all its enmity with Beijing, New Delhi pursues the same geopolitical goal as Beijing: it dreams of a multipolar world with India as the leader of the emerging countries in the south. However, it remains to be seen whether it will ever have the necessary economic clout.