We analysed the data on how India’s ties with the countries of the last five Republic Day Chief Guests have evolved after their visits, especially in terms of the economic and strategic partnerships between the countries.
India has been hosting leaders of other countries as Chief Guests for its Republic Day parades since 1950. This is in essence a foreign policy tool, as the guest country is chosen after carefully considering the need to forge and renew economic and strategic ties.
We analysed the data on how India’s ties with the countries of the last five Republic Day Chief Guests have evolved after their visits, especially in terms of the economic and strategic partnerships between the countries.
France and improved defence ties
The then President of France François Hollande was the Chief Guest of the 2016 Republic Day parade. This was the fifth time France was invited to be the guest country. The French army also became the first foreign contingent to participate in India’s Republic Day parade. This followed Prime Minister Narendra Modi’s visit to France in 2015 and the announcement to buy 36 Rafale fighter jets — the inter-government agreement for the same was eventually signed in 2016, months after Hollande’s visit to India.
Official data shows that India’s trade with France, which stood at $8.36 billion overall in FY16, jumped 31.02 percent to reach $10.96 billion in FY17. The partnership between India and France in the defence sector has especially bolstered since then.
According to data from the Stockholm International Peace Research Institute (SIPRI), the share of France in the overall trend indicator value (TIV) of India’s defence imports stood at just 3.85 percent in 2016. By 2017, a year after Hollande became the Chief Guest at the Republic Day parade, it had jumped to 13.79 percent.
This has only gone up since then to reach 48.35 percent in 2021. The TIV is derived from known unit production costs of a core set of weapons and is used to measure trends in the flow of arms between particular countries and regions over time.
Rising imports from UAE
The President of UAE Mohammed bin Zayed Al Nahyan was the Chief Guest during the 2017 Republic Day Parade. He was then the Crown Prince of the country and became the first non-head of state or government to be given the honour of being invited as the Chief Guest. The UAE is home to around 3.4 lakh Indian expatriates and accounted for 26.9 percent of remittances to India at the time. However, its share in remittances to India has fallen since then to reach 18 percent, mainly due to a rapid rise in the share of remittances from the US.
When it comes to overall trade with the country since the 2017 Republic Day, the figures have been fluctuating. It saw a 5.31 percent decline in FY18, only to improve by 20.1 percent the year after.
The fluctuations in overall trade data were largely due to the change in India’s exports to the country. However, on the contrary, since FY17 imports from the UAE to India have grown consistently, with just a decline during the pandemic in FY21. Imports from the UAE to India grew 108.43 percent to reach $44.83 billion in FY22, from $21.51 in FY17.
ASEAN and Act East
The 2018 Republic Day saw the leaders of the 10 ASEAN countries thronging Delhi as the guests of honour. This was in line with India’s attempts to foster closer relations with the bloc and was in sync with its larger ‘Act East’ policy. This was also a part of the celebration of 25 years of the India-ASEAN relationship.
In FY18, the trade between India and ASEAN countries rose 13.63 percent to reach $81.34 billion from $71.58 billion in FY17. Moreover, it further jumped up 19 percent to hit $96.8 billion in FY19. In fact, despite seeing a decline during both FY20 and FY21, between FY18 and FY22, trade between India and the bloc has grown by 35.74 percent to reach $110.41 billion.
South Africa and Brazil
South Africa’s President Cyril Ramaphosa was the Chief Guest of the 2019 Republic Day, while in 2020 it was Brazil’s then President Jair Bolsonaro. India’s trade with both of them seems to have grown since their leaders visited the country as Chief Guests, despite the disruptions in international trade caused by the pandemic.
No international leaders were invited as Chief Guests during both 2021 and 2022, due to Covid-19.
Strengthening ties with Egypt
This year’s Chief Guest, Abdel Fattah el-Sisi, is the President of Egypt, a country with which India has a long history of friendship. The trade between both countries has grown more than five times in the past 10 years, reaching $4.56 billion in FY19. Even during the pandemic, there was only a marginal decline in trade between both countries. Moreover, the trade between the countries rose 74.77 percent to reach $7.26 billion in FY22.
Agriculture will be a key area of cooperation as Egypt is facing a food shortage, amid the Russia-Ukraine war. Defence will also be another area of focus, as Egypt has shown interest in various Indian armaments.
Checkout Budget Highlights 2023
