Modi's choice
Narendra Modi has just been re-elected as Prime Minister of India, despite Profit margins are far below expectationsWith his third consecutive term, the charismatic strongman has cemented his status as the country's most outstanding leader in generations.
Even though Modi has led India for a decade, his vision remains elusive to some extent. On major issues such as India's diplomacy, economy, society and government, it is still unclear what kind of country Modi wants India to be.
In today’s newsletter, I’ll explain four big questions.
Where can I find friends in India?
India has been deepening its ties with the United States in recent years. It has moved closer to U.S. allies, including Japan and Australia, and has ordered high-end American weapons systems — weapons systems that will create future dependence. And it is unlikely to side with China. In 2020, Chinese troops crossed into Indian-controlled territory, killing 20 soldiers in a skirmish. Since then, Modi has distanced himself from Beijing.
But Modi, 73, has said he does not want to be an ally of the United States. Some officials in his inner circle remain wary of the United States. American diplomats complain about New Delhi’s apparent attempts to erode democratic norms and minority rights. So India is keeping its options open. After Russia invaded Ukraine, the United States tried in vain to persuade India to oppose war. India still processes Russian oil (making up for the gap created by international sanctions). It still buys weapons from Russia.
During the Cold War, India sought to position itself as a non-aligned country. Old habits die hard.
What type of economy?
India recently overtook China as the most populous country and the fastest-growing large economy. Yet much of the country remains poor. Some 800 million people need help feeding themselves. Modi’s ideas about how to help them can be paradoxical, both globally minded and protectionist.
One way is to emulate East Asian countries, which have escaped poverty by producing goods for export. To that end, Modi launched the “Make in India” program in 2014, aimed at replacing China as the world’s factory. But even as Modi has showered India with new subsidies, exports have barely grown. Some Indian economists say it would be better to focus on exporting services, such as IT and remote professional work.
Another of Modi’s visions is a “self-reliant India” that would reduce India’s exposure to global supply chains. Protecting Indian companies from foreign competition is contradictory to preparing them.
Modi has sometimes been equivocal about major economic decisions. Like Reagan and Thatcher, he came to power promising to streamline government. But in reality, the government has broad powers in most areas — imposing radical, sometimes premature, reforms by decree.
Protect minorities?
India’s founding fathers drew up a constitution that was a pluralistic, secular republic. Modi has been remaking India as an explicitly Hindu nation. He turned Jammu and Kashmir, India’s only Muslim-majority state, into a heavily policed union territory. He built a massive Hindu temple on a disputed site where mobs had demolished a mosque. On the campaign trail this year, he called Muslims, who make up 14% of India’s population, “infiltrators.” India’s Muslims say they have become Second-class citizens.
Modi’s third term will be a test: Has the Hindu nationalist project been fulfilled, or can he do more to assert the supremacy of one faith? Appealing to Muslims to take their place is the lifeblood of Modi’s party, which has won a majority among the extremely diverse and caste-divided Hindu population. In a third term, Modi could choose new goals, perhaps agitating to replace historic mosques with more Hindu temples. However, he may be constrained by new political partners who are not bound by his party’s Hindu-first agenda.
How authoritarian is that?
One reason for Modi's enduring success is his efficiency. Modi often implements reforms suddenly, relying on bold and even unexpected means to cut through bureaucracy. He streamlined the tax system and even created the semiconductor industry from scratch. He has no patience for any obstacles.
One result is that the world's largest democracy has jettisoned many democratic norms. Police have thrown opposition leaders into jail, and the number of political prisoners has surged. The Election Commission is packed with pro-Modi appointees. The judiciary has rarely stood in the way of government priorities.
Modi appears to have retained his job but lost his parliamentary majority. Now he needs to appease his coalition partners and consult with them on major changes, perhaps protecting some of the institutions created to maintain a level playing field.
Another possibility is that Modi will crack down harder than before, making full use of the institutions that report directly to him to ensure that his party stays ahead in a tight race. Modi has achieved so much despite complaints about repression. If there is anything that can stop him now, it must come from within his new ruling coalition.
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