India’s Economic Diplomacy: A Quest for Autonomy in the Neo-Liberal World Order

Pragmatism and the urge for autonomy have been the hallmark of India’s economic diplomacy in the neoliberal era. India has undertaken the necessary structural changes in its economy to meet the exigencies of globalization. Such a transformation was stimulated by domestic economic stagnation and the desire to integrate with the global economy at the stroke of the 1990s. Hence, business organizations such as the Federation of Indian Chambers of Commerce and Industry (FICCI) and Association of Chambers of Commerce (ASSOCHAM) have emerged as significant players. They have been instrumental in not only promoting the interest of the Indian business class but also giving them a transnational character. The proliferation of economic networks by the Indian businessmen in the developed world can be regarded as a remarkable achievement in the post-liberalization context. Likewise, the role of India’s EXIM Bank and Indian multinational corporations are equally significant. The ‘class’ dimension of India’s foreign economic policy has been highlighted in the chapter. It means that alongside acknowledging the benefits of globalization, India has raised its voice against the ‘unjust’ nature of the neoliberal international economic institutions. The essence of New International Economic Order (NIEO) of the 1970s can also be traced in India’s vision regarding IMF’s reform pertaining to the Special Drawing Rights (SDR) and Extended Fund Facility (EFF). Regarding WTO’s TRIPS agreement, India has engaged in effective bargaining for safeguarding the interest of the Indian pharmaceutical firms. Through its negotiations with the International Financial Institutions (IFIs), India have emerged as a leader of the Global South. It becomes further evident from her stance regarding food security, rural development and suggesting alternative ways of financial assistance from the World Bank which would be sympathetic to the concerns of middle- and lower-income countries. The spirit of pragmatism has also been resembled in India’s transition from Look East to ‘Act East Policy’. In addition, New Delhi’s changing perceptions of regionalism can be unraveled through engaging in sub-regional ‘experiments’ such as BIMSTEC, BBIN and BCIM. As the states of India’s North-eastern region assumes greater significance, it underlines her thrust towards geo-economic factors and showcasing the inter-linkages of the domestic and international variables while visualizing the contours of economic diplomacy.