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Summiting with Purpose

Published: 03rd April 2015 06:00 AM  |   Last Updated: 03rd April 2015 12:08 AM   |  A+A-

After the fiasco of the “Savile Row” suit at his “chai pe charcha” with president Barack Obama, prime minister Narendra Modi learned, at some cost to his personal reputation, the need to dress austerely. As regards the more serious side of summiting, his attempt to explain frequent travels abroad as pro forma, necessitated by foreign policy imperatives, however, suggests that in accepting a “continuity” agenda set by the vested interests in government led by leading sections within the ministry of external affairs (MEA), he has yet to fully grasp the fact that the value of high-level meets lies in the substantive benefits extracted from host countries, not in lavish Indian giveaways to win short-term goodwill, which is the Dummy’s way to make a personal splash at the nation’s expense, and has been the norm since the turn of the century.

Too often in the last decade, nationalist-minded Indians have had their fingers crossed and hearts in their mouths every time Indian prime ministers sallied forth to foreign lands, or entertained their counterparts in Delhi, because the outcomes invariably involved the commitment of scarce national resources to securing wrong things, and/or the compromising of national interest by surrendering foreign, economic, and military policy options. Hopefully, Modi will not, in his upcoming trips starting April 9 to France, Germany, and Canada, deepen the mistakes already made.

A contract for the unaffordable French Rafale, entirely superfluous to the Indian Air Force’s requirements, for instance, will stifle the Indian Tejas and advanced combat aircraft projects, and an agreement for Areva nuclear reactors, facilitated by the 2008 nuclear deal with the US, as with other such purchases, by confirming the nuclear testing moratorium freeze Indian thermonuclear weapons at the failed-design stage, and create an energy dependency by denying funds for the Indian breeder and thorium reactor development promising energy self-sufficiency just so exorbitantly-priced imported reactors run on imported fuel, the supply of which can be terminated at any time, can be bought.

Modi had the opportunity to seriously rethink the issues involved and chart a new course. Instead, if the nuclear “breakthrough” with Obama is any guide, he chose to follow the MEA line hewing to the supplier country dictates. Thus relations with France, for instance, is thought of as depending on the Rafale contract being signed and on the approval of the sale of Areva reactors, which are plagued by problems of enormous cost and time over-runs wherever these are being erected (such as in Olkiluoto in Finland). Besides, astonishingly, inverting the traditional buyer-seller relationship where the buyer has the upper hand, it puts the onus of failure on India for not meeting relationship benchmarks set by Paris that is desperate to sell!

It makes one wonder how India got to this pass. Why it is that New Delhi seems determined to expend scarce monies on high-value foreign products of doubtful utility amounting to a criminal waste of national resources? And, more importantly, whether the Indian government even knows what’s good for the country?

If, as Modi has tweeted, this trip is centred on boosting the Indian economy and “creating jobs” for the youth, he cannot do better than ask especially the Angela Merkel dispensation in Germany, and secondarily France, to materially assist in establishing the “mittelstand” here. Mittelstand is the network of small and medium-sized, often family-owned, engineering enterprises and workshops that prosper by continually producing specialised, high-quality engineering goods, and are the bedrock of the high-technology sectors (aerospace, automobile, etc.) in these countries. New technologies thus produced are incorporated by big corporations into their designs for major hardware. Mittelstand also has been the engine of the German economy 1900 onwards, employing over 70 per cent of the workforce, responsible for over 82 per cent of the country’s vaunted apprenticeship programme for skill-building, and accounting for over 60 per cent of its economic output. It has proved so successful France copied it. If mittelstand is not on his list of “talking points” provided him by MEA, the prime minister should put it there.

He should explore in Berlin how the mittelstand concept can be replicated in this country and what programmes and projects Germany can get underway to achieve this aim. And, rather than sign fly-blown contracts for the Rafale aircraft of dubious merit and for the equally suspect nuclear reactors that will deprive the indigenous aerospace and nuclear programmes of much needed funding, Modi must ask Paris for pointers on how it converted the German mittelstand to fit French conditions, and what lessons India can draw from that experience. Modi ought to make support for rooting this economic-industrial set-up in India the metric for judging future relations with these two countries.

Indians, man for skilled man, are as inventive and productive as their US and European counterparts, as the record of Western companies in Bangalore, Hyderabad, Chennai, and elsewhere using Indian talent to produce exceptional technological innovations, patents, and profit for these companies, shows. The trouble is the traditionally statist-oriented Indian government has shied away from providing its own people and industry the enabling environment that puts a premium on growing technology. The same results can be obtained here by trusting in and incentivising Indian engineering and entrepreneurial talent. But first, it will require the BJP government to renounce the easy import option. As the Israeli defence minister Moshe Ya’álon said in Delhi recently apropos of his country’s success in the military technology sphere, “Having no choice is the best incentive.”

Modi should focus on the ways and means by which small and medium enterprises can be technology germinators and innovators, and generate wealth and employment with or without direct German and French inputs. And, whilst in Canada, rather than get hung up on a “nuclear deal”, he should prod the Bombardier Company, say, into setting up production line and R&D unit here to produce technologically advanced rolling stock for export and to meet the elevated/underground metrorail needs of prodigiously growing Indian cities.

Modi can talk up India alright. Time is nigh he ensured his jaunts abroad helped root an Indian mittelstand as the cutting edge of an “innovation economy” at home.



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