Indian Prime Minister Narendra Modi. Photo: Xinhua

In his inaugural address at India Global Week 2020 on July 9, Prime Minister Narendra Modi spelled out in detail his vision of “Atmanirbhar Bharat,” or “Self-Reliant India.” He explained that the concept “merges domestic production and consumption with global supply chains” without “being self-contained or being closed to the world.”

Modi added that the national need was to ensure self-sustaining and self-generating growth with an emphasis on “efficiency, equity and resilience.” 

Atmanirbhar Bharat Abhiyan (translated literally as Self-Reliant India Mission) was officially announced for the first time in May to fight the Covid-19-induced economic slowdown. The use of the term atmanirbhar (self-reliant) refers to Modi’s intent not only to free India from over-reliance on foreign supply-chain networks but also to create a culture of autonomous thinking and discipline.

At the same time, Bharat (India) stresses the indigenous character of the scheme. With the swadeshi philosophy as the bedrock, the renewed pursuit of atmanirbharta under Modi might allow India to carve a niche for itself. For India’s long-term self-sufficiency, one of the goals of Modi’s Atmanirbhar Abhiyan is to make India a hub of manufacturing and investment. 

But what about the ambit of this self-reliance in India’s foreign policy? 

For long, the fundamentals of Indian foreign policy have straddled “strategic autonomy” and “multi-alignment.” While the Atmanirbhar Bharat campaign may not necessarily lead to a big foreign-policy departure, it indicates India’s readiness to follow a renewed path or taking few radical steps in an uncertain time.

In the near future, India’s international outlook for economic engagement might transcend from multi-alignment to pointed-alignment with a set of countries that are critical to India’s economic and strategic interests in promoting an alternative supply-chain network, allowing it to move away from China. 

In other words, the concept serves India’s strategic intent to enhance its economic footprints in the Indo-Pacific region by strengthening economic relations with countries that are critical to the rules-based global order.

A stronger strategic partnership with greater FTA engagement along with robust defense ties with select countries explains this pointed alignment. This concept, therefore, provides greater emphasis on foreign direct investment (FDI) from countries such as the United States, Japan, Australia and South Korea; India’s efforts to engage more intently with the partners as a strategic ploy here.

Importantly, India and the US are looking to revitalize their “exclusive partnership” to provide preferential market access to both nations, as stated by India’s previous ambassador to the US Harsh Vardhan Shringla (current foreign secretary) at the farewell reception organized by the US-India Strategic Partnership Forum (USISPF) in January. 

Japan too has portrayed itself as India’s natural partner in Northeast India by investing in a host of projects including water supply project in Guwahati, the road network in Assam-Meghalaya, forest management and agriculture and developmental projects across the region.

The Japan International Cooperation Agency (JICA) is already partnering with the Indian government in the North East Road Network Connectivity Improvement Project and other transport projects in India such as Mumbai-Ahmedabad bullet-train project, the Metro Rail projects in Delhi, Mumbai, Bangalore, Chennai, Kolkata and Ahmedabad; and the Western Dedicated Freight Corridor from National Capital Region to Mumbai. 

India’s desire to seek a strategically autonomous and pointed-alignment-oriented foreign policy is not a sudden development. India has been signing several free-trade agreements (FTAs) or economic partnerships such as the South Asia Free Trade Agreement (SAFTA), India-ASEAN Comprehensive Economic Cooperation Agreement (CECA), India-Korea Comprehensive Economic Partnership Agreement and India-Japan Comprehensive Economic Partnership Agreement as a way to enhance economic partnerships in the region.

Moreover, New Delhi’s policies such as “Make in India,” “Start-up India” and “Digital India,” which aimed to open the Indian market to FDI in order to galvanize the economy, were introduced during Modi’s first term. India’s current move to launch the auction of 41 coal blocks for commercial mining last month was a medium to invite greater foreign investments after the coal mining sector was opened to FDI in August 2019.

India also allowed increased FDI limits in such sectors as aviation, media (animation), insurance, and single-brand retail. This move, particularly in terms of the aviation and insurance sectors, was a huge positive, since these sectors were highly capital-intensive.

However, even as India has chosen to build a strong economy by pursuing privatization in some areas, it has remained uncompromising in its national-security ambition. The government recently made changes in the country’s FDI policy to curb “opportunistic takeovers/acquisitions” of Indian companies, particularly aimed at China. 

Defense cooperation agreements with like-minded countries are also integral to this effect. In May, the government announced reforms to boost self-reliance in the defense sector by raising the FDI in defense manufacturing (from 49% to 74%) and promoting the use of local-made military hardware, releasing a list of weapons that cannot be imported.

The Defense Acquisition Council (DAC) approving deals that focus on indigenous design and development is a testament to the atmanirbharta (self-reliance). In order to bolster the indigenous defense manufacturing, more deals on the lines of these agreements signed at the India-Australia virtual summit last month are also likely. 

Earlier, in February, a day before the DefExpo 2020 organized by India’s Ministry of Defense was to begin, Defense Minister Rajnath Singh tweeted that India recognized “the influence of artificial intelligence and digital technology in defense sector.” He also hinted at future engagements with strategic partners like South Korea to develop AI-enabled military technology.

Indeed, events like DefExpo 2020 assume greater importance. More so, as it can help bolster defense ties with countries such as France – which was well represented in DefExpo 2020 by seven of its largest defense companies, namely Nexter, Safran Thales, Dassault, MBDA, Naval Group and Airbus – and Japan (during DefExpo 2018, Mahindra Defence inked an agreement with ShinMaywa Industries of Japan for manufacturing and assembly of amphibious aircraft in India). 

New Delhi has already inked several agreements with Washington such as the US Defense Technology and Trade Initiative (DTTI), General Security of Military Information Agreement (GSOMIA), the Industrial Security Annex (ISA), Logistics Exchange Memorandum of Agreement (LEMOA) and Communications Compatibility and Security Agreement (COMCASA).

It has also signed agreements with Russia (the S-400 missile contract and air-to-air missile deal, among others). Moreover, India recently upgraded its bilateral relationship with Australia to Comprehensive Strategic Partnership, coupled with agreements concerning on “mutual logistics support.” 

Thus the call for “Atmanirbhar Bharat” in the defense sector has certainly taken on a new meaning in the post-Covid, and post-Galwan, period. The government’s defense plans, as part of the Atmanirbhar Bharat Abhiyan, highlight a shift from dependence on imports to the increasing competence in exports.

Covid-19 is certainly having an enormous impact on the global geopolitical order, and India is not excluded. To stay relevant and emerge as a vital link in the new post-Covid supply-chain networks, India needs resurgent national and international strategies – one of the aims of Modi’s Atmanirbhar Bharat campaign. 

A new foreign-policy outlook is an integral part of these strategies if India wishes to enhance its stature as an emerging Indo-Pacific power. To what extent India can embrace a path of pointed engagement with like-minded countries in the Indo-Pacific region, one has to wait and see.

Nonetheless, Modi’s Atmanirbhar Bharat has a subtle narrative: It aims to prepare India to tide over not only the ongoing Covid-19 crisis but also the looming Chinese intimidation in the region by making India’s foreign policy resilient. 

Jagannath Panda is a research fellow and center coordinator for East Asia at the Manohar Parrikar Institute for Defence Studies and Analyses, New Delhi. He is the series editor for Routledge Studies on Think Asia.