New Delhi: India’s declining global standing, according to the latest findings of the Lowy Institute, Australia’s most respected think tank, measured by its latest Asia Power Index [API], is a reality check for Indian intellectuals, media anchors and editors of print media.

Indian media has been gushing about our nation’s growing global power status after every visit of any foreign leader to India. But API rates India’s overall score in 2020 as lower [1.3 points] compared to the level in 2019. Hence, a wake-up call!

Lowy Institute ranks India as a “middle power” despite India being, by the purchasing power parity [PPP] index calculation of GDP, as the third largest in the world. Instead of GDP size, the institute ranks countries on eight indicators, by which India has lost in ranking in four soft power indices: (1) future and potential resources; (2) trans-national economic relationships; (3) diplomatic effectiveness; and (4) cultural influence.

Surprisingly the decline is sharpest in the cultural influence indicator.

It is significant that even though India has, in international comparison, done well in the handling of the Covid-19 pandemic, the economic toll of that pandemic has been held by the Institute as a cause of the slide in ranking.

Overall, the picture given of India is one of opportunities lost and underperformance due to incompetent economic stewardship. That picture fits with what I know to be the reality. The study however observes that: “India exerts less influence in the Asian region than expected, given its available resources.”

To be sure, all such rankings have an element of arbitrariness, but the point that stands out in the latest assessment is that China is gaining traction in Asia and India is losing it.

China’s overall score in the eight indicators aggregated remained unchanged over 2019-20, despite a dramatic fall in the score for diplomatic influence, principally the result of accusations of withholding information about the severity of the Wuhan outbreak.

India’s and China’s positions in the Asian Power rankings due to the relative economic performance are as follows:

First, economically China is the only major economy to chalk a positive GDP growth rate so far in 2020, whereas India’s GDP has shrunk, according to quarterly data, by the maximum amongst major economies.

Second, militarily in Ladakh, India has been losing territory to China, which has been nibbling since 2013 across the mutually agreed LAC, due to the PLA incursions and camping more or less permanently.

Third, India’s lack of sustained pro-active retaliatory action against Pakistan, not withstanding sporadic action such as “surgical strikes” for terrorist-enabled attacks on Indian soil, or to the audacious claim on Indian territory by its small and landlocked neighbour, Nepal, is a major factor for downgrading India’s global power status.

It appears to the world that despite innumerable highly publicised bilateral meetings at various levels perception-wise, India lacks the required concomitant military and diplomatic heft or nerve to regain its own territory that is been lost to aggressive neighbours.

What is more, the power gap of India with China is expected to grow judging by both hardware and software defence capability of the two nations. From being five times India’s economy in nominal exchange rate terms in recent years, China will become six times in a year hence, India’s global power decline is because the declining annual GDP growth rate of India from 8% in 2015-16 [FY16] to 3.1% annual equivalent in the fourth Quarter of FY20, and the Covid-19 pandemic caused globally largest negative growth rate of GDP in FY21.

Indeed, in foreign trade terms of economic relationships, the rankings reveal India has slipped to seventh position, on account of its inability to forge viable regional trade integration efforts.

Even in bilateral trade with China, Indian exports are mostly raw materials including the world’s best quality iron ore from Kudremukh hills of Karnataka or raw tobacco from Guntur in Andhra Pradesh. China exports to India were mostly manufactured products.

China has already replaced India as the largest investor in Nepal, and India’s withdrawal from the Regional Comprehensive Economic Partnership has proven damaging for the country’s trade outlook.

On the economy, India has now chosen to play defensive, focusing on import substitution rather than exports emanating from the Atmanirbharta call of the Prime Minister to the nation.

This autarky mindset is self defeating. Even the most dictatorial North Korea has failed in this venture. China’s rapid progress during the three decades of Four Modernisations—1980-2010—came through a smart “foreign switch trade” policy, which entailed importing liberally from East Asian nations semi-process goods and adding value to it with Chinese cheap and disciplined labour and exporting the final products to USA and Western Europe. We cannot replicate that switch trade strategy because the necessary economic, infrastructural, and land laws reforms have not been carried out yet for it.

The China and India defence technology gap is also rapidly increasing because China effectively spends 6% of its GDP, while India spends just about 2% of GDP and that too largely on pensions and administrative expenses.

It is time that, as was earlier with the Railway Budget till three years ago, the Defence Budget, be prepared by the Defence Ministry without the veto of the antediluvian minds in the Ministry of Finance, and be directly presented to the Parliament by the Defence Minister and voted on by Lok Sabha.

As a Member of the Standing Committee of Parliament for Defence I had been witness to Army Generals deposing before the Committee almost in tears, on the cuts of essential capital expenditure by the Finance Ministry for new proposed weapons systems. I believe Manohar Parrikar, one of our best Defence Ministers, quit and went back to be Chief Minister of Goa again for this harassment and humiliation by the Finance Ministry.

The military gap in naval and missile capability as of now is expanding very slowly. The display of missile tests recently is unlikely to impress defence strategists since it is known the tests were for weapons systems that are a long way from becoming operational.

The question today confronting India therefore is how to and what to do to recover our position in weapons modernity and in the international gamesmanship with China, stemming the loss to that country on ground realities in both dimensions—soft and hard. As a start India must get pro-active to evict the PLA from Ladakh, which is a pre-requisite for recovering India’s due status in global ranking.

It is clear that cannot however be by media spin on television channels showing four Rafale jets taking off from France landing in Dubai, and then taking off from there to land in Ambala and being received by rose petals strewn on the runway, which was a sickening spin for those who know better.

The most fruitful option, one by which India can get the best and most sophisticated weapons from the most advanced weapons producer of the globe is the United States.

We have a large enough foreign exchange reserve to be able to buy all that we need for the next ten years from the US today.

But doing serious business with the United States, with Donald Trump or Joe Biden as President during 2021-2025 has an invariable bottom line: What is in it for US for selling such weapons to us?

One clear requirement that US would want is that India must do for US what US is tired of doing by itself. For example, ensure that neither China nor ISIS takes over Afghanistan after US troops [stationed there since 2001] leave that country.

India can do that and must do by sending two divisions of the Army and three squadrons armed with US-donated most modern fighter jets, bombers and stealth aircraft and surface to air and air to surface missiles. India would also need two aircraft carriers and five submarines to be deployed in Arabian Sea and Indian Ocean to deter some rogue nations. India can no more be “touch me not” type if it wants to play a global role especially in the challenging Chinese attempted hegemony.

But for US and India’s solid national security, that is not enough. India must retire all Russian military equipment that we have purchased since 2005. This is because Russia since 2005 has become a “junior” partner of China, and is using Chinese software and electronics in Russian military equipment such as S-400.

Russia now spies and fronts for China due to its heavy financial debt owed to China. Moscow Times in its 23 October 2020 edition has reported Vladimir Putin telling a prominent think tank in Moscow that “a future military alliance of Russia with China is quite possible. Already Russia is sharing with China sensitive military technologies [such as S-400 air to surface missiles?]”.

Studies such as of the Warsaw Institute, Poland on 2 November 2019 published an opinion piece titled “Russia: China’s Junior Partner”; Carnegie Endowment for International Peace, Washington D.C.. USA published in 2020 a piece titled “Russia in the Asia-Pacific: Less Than Meets The Eye”; and a recent and stimulating op-ed in the Hindu by our former Foreign Secretary Vijay Gokhale, have cogently documented and argued that Russia is now a junior partner of China [I shall elaborate the arguments made in these studies, in my next article in The Sunday Guardian].

Until we become prepared to evict the Chinese from our territory, India must work for Indian Ocean nations’ alignments. In this context, the formal extension of an invitation by India to Australia to join the other “Quad” powers—Japan and the US—for the Malabar naval exercise is a good move and soon we should have bilateral arrangements with Sri Lanka, Indonesia, and Maldives if these countries do not want to expand the Quad by their participation. The 2+2 meet between US and India later this month is another occasion to give teeth and effect to this Quad. India must not waste this opportunity. If India cannot keep its territory intact, it cannot be a global power for which the nation has the potential to be. The leadership has the opportunity today for it, and not fritter it away as Jawaharlal Nehru and some other Prime Ministers did.

Dr Subramanian Swamy is a sixth term MP. He has taught economics at Harvard and at IIT Delhi, and has been senior Union Cabinet Minister of Commerce and Law & Justice.