Development Will Drive Economic Diplomacy

Published: 26th May 2014 06:00 AM  |   Last Updated: 26th May 2014 12:37 AM   |  A+A-

Pakistan prime minister Nawaz Sharif’s decision to attend the swearing-in ceremony of prime minister-elect Narendra Modi on Monday has ended all the speculations and uncertainties on this score. There were reports that the Pakistani establishment was divided on the question with the military and intelligence opposing the visit. Sharif has succeeded in building a consensus on the issue. However, it would be a misnomer to call the visit a game-changer. If anything, Modi’s gesture—the first time foreign dignitaries are invited to the swearing-in of the prime minister—should be seen as a symbol of his earnest desire to establish good-neighbourly relations.

It is a measure of the success of Modi’s initiative that all the members of the South Asian Association for Regional Cooperation (SAARC) have eagerly responded to it. The signal has clearly gone out that India is keen to have peace and stability in its neighbourhood. Modi has also set the stage for a clearer foreign policy with greater focus on economic diplomacy. This is one aspect he has been most positive about as can be inferred from his statement that “a strong economy is the driver of an effective foreign policy and India has to put its own house in order so that the world gets attracted to it”.

With development being Modi’s prime concern and commitment to the nation, economic diplomacy becomes the cornerstone of his foreign policy. For various reasons, trade among the SAARC nations has not been growing as desired, though sky is the limit for bilateral and multilateral trade. Building business with neighbours also helps strengthen political ties. Central to the policy is also the ability to attract investments from foreign and domestic sources. It is possible only if corrective steps are taken to speed up decision-making from the highest to the lowest level, make land acquisition easier and amend labour laws to ease investment. As Modi said, modernising the economy further is a precondition for attracting investment, which alone will put development on the fast track.


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