Chapter 4

India: Asia’s Other Economic Powerhouse

From the booklet Russia and China in Prophecy

India—with its population of more than 1.2 billion people—is almost certain to join the Asian bloc that is prophesied to congeal in the end time.

In May 2014, after five weeks of voting and more than 800 million ballots cast, India’s Bharatiya Janata Party won a landslide victory. It was the largest election in mankind’s history. The new government run by Narendra Modi achieved the first absolute majority in India’s lower house of Parliament in over 30 years. This gave Modi powers his predecessors could only have dreamed of.

During his victory speech, Modi said, “Good days are coming. The journey has started.” This “journey” holds great geopolitical significance because it is one that is steering India ever further from the United States and Britain—and ever nearer to Russia, China and other Asian states.

Away From the West, Toward the East

Back in 2005, the U.S. revoked Modi’s visa on the grounds that he had played a role in one of India’s bloodiest episodes of religious violence. The violence had taken place in the state of Gujarat, where Modi worked at the time as chief minister. Hindu rioters there killed more than 1,200 Muslims and forced another 150,000 to flee their homes. Modi was accused both of failing to stop the violence and encouraging it. His involvement was never proved, but the U.S. slapped sanctions on him, and the EU quickly followed suit.

Modi responded to the Western snub by looking east. Ever since, he has been making friends and forging alliances with China, Russia, Japan and other Asian countries. The South China Morning Post explained that his ascension as India’s prime minister represented a bane to the U.S. and a boon for Eastern powers: “Modi is also known to have an Eastern bias, with Asian nationalism forming the core of his worldview. Apart from China, that also draws him closer to Japan and Singapore, with whose leaders he has struck up a similar rapport. … Modi’s unimpeachable conservative background and open admiration for China has in the past raised hopes of him becoming a sort of Indian Richard Nixon” (May 16, 2014).

Nixon is not the only world leader Modi has been compared to. The Diplomat called him “India’s Shinzō Abe” because some of his nationalistic leanings mirror those of the Japanese prime minister. India’s Economic Times reported, “Many Chinese officials who have dealt with Modi compare him to their present boss Xi Jinping” (May 14, 2014). Oneindia skipped to the chase, likening Modi to Asia’s big man himself: “[He is] India’s Putin,” the website stated. His heavy-handed leadership “may revive India as Putin did in Russia [because] Modi has similar Putin-like capability to metamorphose India into an economic and military powerhouse through a series of tough measures and steps, which would help India leverage and unleash its real potential” (May 6, 2014).

A Resilient Friendship

Modi has made his fondness for Russia especially clear. During the 2014 brics summit, he said: “Even a child in India, if asked to say who is India’s best friend, will reply it is Russia because Russia has been with India in times of crisis.”

A look at the long history between India and Russia reveals why he would make such a statement.

Starting back in the 17th century, Indian merchants—mostly from Sindh and Multan—regularly crossed into Russia and began building the foundation of the Russo-Indian relationship. By the early 18th century, Indian traders were living not only in Russia’s southern city of Astrakhan, but also as far north as Moscow. By the 1900s, Indians were dispersed throughout Kazan and St. Petersburg, and many had become assimilated. It looked as if the peoples of India and Russia were on course to build a lasting bond.

But then came the British.

Britain colonized India in 1858 and brought rule of law and governance to the subcontinent. British rule was far from perfect, but it lifted millions from squalor and oppression. Its influence also replaced Russian influence, aligning the subcontinent with London rather than St. Petersburg.

Russian leaders were never indifferent about Britain’s colonization of India. They were outspoken in their desire to see the British pushed out of India.

Vladimir Lenin, who later became ruler of the Soviet Union, said in 1918: “There can be no general peace without a free independent India. … We, Russian Revolutionaries and International Socialists, feel it our duty to rejoice at the announcement of a revolution in India but also to support this revolution by direct or indirect means and with all our powers.”

Thanks in part to Soviet support, anti-British sentiment took firm root throughout India.

Indian leader Mahatma Gandhi, the primary architect of India’s independence movement, acknowledged Russia and its revolution as a source of inspiration to him: “We, too, can resort to the Russian remedy against tyranny. … Our shackles will break this very day if the people of India become united and patient, love their country and think of the well-being of their motherland disregarding their self-interest. … We also can show the same strength that the Russian people have done.”

Shortly after Russia’s February 1917 revolution, Gandhi said, “Bolshevik ideals sanctified by the sacrifice of such master spirits as Lenin cannot go in vain.”

India’s struggle continued to intensify, and in 1947 the British granted it independence. The Soviets wasted no time moving into the void and fostering close relations with the newly independent Indians. In fact, the Russians had taken some key steps toward rebuilding a Russo-Indian bond even before India’s independence was official.

In April 1947, two months before independence, India and the Soviet Union announced the establishment of formal diplomatic relations. By 1951, India had adopted the Soviet Union’s Five-Year Plan economic model, complete with Communist-flavored heavy centralization. Under this framework, India’s growth and progress was extremely slow.

Officially, India was nonaligned during the Cold War. Unofficially, however, both sides viewed it as an ally of the Soviets. When the U.S. tilted toward Pakistan, India’s rival, relations between India and the West grew even more strained. The camaraderie between Russia and India took a great leap forward in 1974, after India had conducted nuclear tests and the Soviet Union emerged as the only major nation to support India’s right of “self-defense.”

Throughout this era, India remained weak. The Soviet economic model stifled its growth and progress. The nation suffered from high unemployment, rampant corruption and prolonged periods of stagnation. But the weakness would not last!

The Elephant Rises, and Leans Toward Moscow

After the fall of the Soviet Union, India moved away from the Soviet-inspired economic model. It took steps to liberalize, privatize and reform its economy. It quickly began to undergo staggering growth.

In retrospect, it was clear that India’s earlier adoption of a Soviet-modeled economy had hindered the nation’s growth. But India seemed to harbor no ill will toward the Russians. After the Soviet Union collapsed, Russo-Indian relations remained warm and were soon after transformed into what was labeled an “Indo-Russian partnership.”

In 2000, India’s and Russia’s leadership signed the Declaration on the India-Russia Strategic Partnership, and the two nations entered new levels of cooperation in such areas as defense, economy, technology and security. Around that time, India became the largest purchaser of Russian military gear.

India’s unwavering support of Russia was made plain in 2008 after Russia invaded Georgia. The Western world decried Moscow’s expansionism, but India refrained from all criticism. By the end of the year, India signed a joint declaration with Russia, showing that the two were in agreement over the status of South Ossetia and Abkhazia.

In 2010, Putin elevated the Indo-Russian partnership to a “special and privileged” strategic partnership. And he began issuing calls for India to be given a permanent membership in the United Nations Security Council.

In 2014 when Russia annexed Crimea, India openly backed Moscow while Western powers condemned Russia’s actions.

Meanwhile, India’s economic growth continued to surge. At the end of the Cold War, India’s gross domestic product was $274.8 billion. By 2014, it was over $2 trillion—the seventh-largest in the world. By 2015, India had become the world’s fastest-growing large economy.

And it is set to keep on mushrooming. “India is the most promising story in Asia on a five- to 10-year view,” said strategist Christopher Wood in 2015. “Mr. Modi is the most pro-business, pro-investment political leader in the world.”

During a March 2015 lecture in New Delhi, International Monetary Fund Chief Christine Lagarde said: “Indeed, a brighter future is being forged right before your eyes. By 2019, the economy will more than double in size compared to 2009. When adjusting for differences in purchase prices between economies, India’s gdp will exceed that of Japan and Germany combined.”

Can India and China Get Along?

Relations between India and China have historically been frosty and fraught with competition and border disputes. But since both nations heartily support Putin’s Russia, and since both are driven by increasingly anti-Western ideologies, it is not unreasonable to anticipate a great thaw in the future of Indo-Chinese relations. Already, many signs point to such a shift.

During nato’s Kosovo campaign, Russia wanted to challenge America’s dominance by suggesting a Russia-China-India axis. Neither India nor China ruled the notion out. This was a powerful signal that China’s and India’s desire to see the era of Western dominance come to an end overrides the grievances they have against each other.

Then from 2000 to 2014, bilateral trade between China and India surged from under $3 billion to $71 billion.

And all of that was before Modi came to lead India. Since the Chinese knew that Modi shared in their anti-Western ideologies, they were delighted when he was elected. “This has caused worries from the West,” China’s state-run Global Times wrote. “Western countries like the U.S. hope to use India to counterbalance China, but they don’t support India on issues of the country’s core interests” (May 5, 2014).

Within days of his election, Modi invited Xi to visit India. In September 2014, Xi traveled there and promised $20 billion worth of investments in India over the next five years. More visits are on the horizon.

On October 12, 2015, the Chinese People’s Liberation Army and the Indian Army began a joint counterterrorism exercise, code-named Hand-in-Hand 2015. It was the fifth of such counterterrorism drills the two sides had held since 2007. The goal of the exercises, according to India’s Ministry of Defense, was “to develop joint-operating capability, share useful experience in counterterrorism operations, and to promote friendly exchanges between the armies of India and China.”

The Global Times said, “There is no need to be astonished over the joint drill, for the idea of peaceful coexistence has already been deeply rooted among people from both China and India” (Oct. 11, 2015).

The Times article said “a joint military exercise is a barometer of bilateral relationships.” The article acknowledged the historic tensions between China and India, but said the new wave of military drills means these are mostly superficial. “Confrontations in recent years were not created on purpose but happened by accident. Leaders from both China and India have consensus and enough means to take divergences under control” (ibid).

Another remarkable indication of Indo-Chinese cooperation came in July 2015 when China allowed Modi’s India to join the Shanghai Cooperation Organization.

A Rising Military Powerhouse

Many view India as a pacifist culture bound by a creed of Gandhian nonviolence, but the nation has astounding military potential. And in recent years, India has worked to expand that potential.

From 2004 to 2009, India’s military expenditure increased by 45 percent. According to ihs Jane’s 360, India imported $200 million in military equipment in 2009 just from the U.S. By 2013, that figure had risen to $2 billion.

In May 2014, when Modi was elected, India began a rapid military modernization and buildup. By November, the new prime minister had approved $19 billion of arms procurement proposals. Within six months, he had approved 41 deals from heavy guns to submarines to build up the Indian military. India had never before undergone a buildup on that scale.

In 2015, India became the world’s top arms importer, and the bulk of those imports came from Russia. From 2009 to 2013, Russia provided roughly 75 percent of India’s military imports. “Russia has been India’s foremost defense partner through the decades,” Modi said on December 11, 2014. “Even as India’s options have increased today, Russia will remain our most important defense partner.” The two countries have also agreed on joint development and production of future, cutting-edge weapons systems.

Analysts estimate that by 2020, India will have spent around $100 billion on new military hardware and will possess no fewer than 1,600 Russian T-90 tanks.

India’s Future

In an article titled “America’s New Nightmare: India, China Plus Russia,” Russia’s Svobodnaya Pressa wrote about the congealing bond between Russia, India and China: “For Russia, the rapprochement between India and China is an issue of paramount importance. For a long time, the concept of a strategic triangle between Russia, China and India has existed, but until recently it has not appeared particularly viable. The ric [Russia, India, China], as the group is known, has been largely an economic forum, without much to show in strategic terms” (May 14, 2015).

But somewhat suddenly, things are different. The three are the top shareholders in China’s aiib, all are part of brics bank, and all are members of the sco. All of these massive institutions are designed to diminish and eventually end the era of Western dominance. In February of 2015, ric held its 13th meeting during which members called for a new world order and vowed to “build a more just, fair and stable international political and economic order.”

Many signs today show that global power is shifting from West to East. India has been a key part of that shift, and if it continues to cooperate with Russia and China, it is likely to take on an even greater role.

Continue Reading: Chapter 5: Japan’s Place in the Future