An opinion born of frustration that is dead on arrival

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Long-established and widely accepted comparative advantage principles encourage nations to trade. Most nations actively participate in international trade. Further, the World Trade Organisation (WTO), since its institutionalisation in 1995, has ensured basic economic dignity for its 168 members. Therefore, there are no nations under ‘dead economies’ category although warring countries (like Ukraine) or long-term sanctioned countries (like Iran and North Korea) are as good as stagnant economies.

However, when India is called ‘dead economy’ without suffering war atmospherics, sanctions regime, or growth-related stagnation, western leaders ignore India’s recent economic achievements and do not adequately acknowledge the ‘great India story’.   

Far from being a dead economy, India is happily walking, talking and charting out its upward growth story. In 2025, India is forecast to emerge as the fourth largest economy. If present growth rates continue, it should become the third largest by 2028. India would most likely retain this lead position in near future. After the pandemic period, very few countries have managed high growth rates in sustained manner as India has done.

Presently, no great power is anywhere close to India in terms of GDP growth rate. All futuristic projections predict India to surpass the US and become the second largest economy after China by 2050. Perhaps, the western elites do not believe in net assessments and futuristic projections.

Surprisingly, the dead economy allegation comes at a time when India is held in favourable esteem in western ‘public perceptions’. For instance, the Pew Research Centre conducted a survey of 23 countries in 2023 that included the US, UK, Canada and other western countries, wherein 46 per cent of people held a favourable opinion about India and only 34 per cent people had an unfavourable opinion.

 Part of the reason is India’s long-standing democratic tradition and its political conception of tolerance towards conflicting ideologies dividing the world into rival groups during the Cold War and even after that. Another reason is visible presence of Indian emigrant community that is hard working, prosperous and powerful in many western countries. Irrespective of what is said by few western leaders, there is ubiquitous support for forging greater partnership between the western countries and India. India’s economic prospects and big emerging market (BEM) potential work as pull factors for these countries.

The recent ‘dead economy’ euphemism is not the first instance when some leaders in West have misjudged India. During the 1971 War, US President Richard Nixon influenced by Henry Kissinger’s wrong and biased advice, ridiculed the Indian leadership, in particular, Prime Minister Indira Gandhi. The duo supported Pakistan in every possible manner, most notably, by sending the USS Enterprise. This despite the fact that the vast majority of American State Department and its diplomatic fraternity was sympathetic to India’s cause.

In 1998, President Clinton committed the folly of sanctioning India over nuclear explosions. Within few years, he was on back foot and visited India. Most recently, one set of Canadian leadership was at loggerheads with India only to be replaced by another set that believed in reconciling with the ‘great India story’ factor.

Even when the great India story is being heard out all over the world, many western leaders assume that (only) they would facilitate India’s rise to great power status. There are no historical examples of one great power facilitating other great power’s rise. Theoretically, it is an impossible proposition!

And yet, American journals like the Foreign Affairs have the guts, courage and conviction to say (in its most recent edition) that India simply does not have the ‘right grand strategies’ to achieve its great power ambition with ‘America’s facilitation’. The great India story does not adequately figure in western academic discourse, rather deliberately. Instead, India is often portrayed as a nation with divisive issues.

It is also debatable if caustic comments about ‘dead economy’ will dampen the great India story spirit or even damage India’s relations with the US or any other western country in the long-term. For instance, in the case of the US, there are simply too many variables shaping Indo – US ties. Leadership factors, even if occasionally not healthy, are peripheral in shaping the bilateral relations.

Rising India has increasing international acceptance, finding resonance in diplomatic platforms in the Indo – Pacific and elsewhere where the US and other friendly countries are members. Additionally, like previous leaderships in the West that put a premium on human rights in their foreign policies, the Trump-led US leadership puts a premium on tariffs as the edifice of foreign relationships that includes India.

India’s own bilateral trade negotiations with the US have been intensive and inconclusive. Continuous engagement may yield mutually agreed tariffs at some stage in future and take the wind out of ‘dead economy’ allegation. Unlike the US, China, Germany, Japan or the UK, India does not have its own camp and maintains relations with all. Western leaders do realise India’s ‘swing state opportunity’ and would like to have India on their side in shaping the new financial order.

The dead economy comments against India were made less out of conviction and more out of discomfort and frustration arising out of the latter’s constructive, issue-based partnership with all countries, including an oil deal with Russia. However, the US is no more the economic hegemon in international trade. Therefore, pax Americana may not work with India that has the long-term capabilities of re-routing exports meant for American markets to elsewhere. India must, therefore, ignore such momentary comments and quietly work for economic growth, empowerment and placement in the new financial order.

(The author is in the Indian Defence Accounts Service.)

Views are personal and do not represent the stand of this publication.