Making a case for eliminating rifts and differences to build a new world order, Prime Minister Narendra Modi Tuesday flagged the rising threat of protectionism, saying that a new layer of tariff and non-tariff barriers were being erected with countries increasingly focusing inward.
Speaking at the World Economic Forum on his first visit to Davos, the first by an Indian Prime Minister in 20 years, Modi also pitched for India as an investment destination, emphasising on efforts to improve the ease of doing business. “We have made it so easy to invest in India, manufacture in India and work in India. We have decided to uproot licence and permit Raj. We are replacing red tape with red carpet,” he said in his keynote address on the opening day of the WEF.
Highlighting how technology was influencing the way we work and live today, the Prime Minister said, “He who is able to control data will control the world.”
In the global context, Modi said that bilateral negotiations have virtually come to a standstill because of new trade barriers.
“We have to accept that globalisation is losing lustre with the intention being to reverse the natural flow of globalisation, and forces of protectionism are raising their heads again,” he said, while addressing the audience of global CEOs and other leaders, including the President of Switzerland.
Modi’s remarks come just a couple of days before President Donald Trump’s scheduled appearance here, with the US pushing hard for its America First economic and foreign policies.
Opting to speak in Hindi, in a speech that lasted over 40 minutes, Modi referred to fractures in the global scenario. “Is our global order widening these fault lines and increasing differences? What are the powers which give preference to conflicts over co-operation and what are the paths we can follow to eliminate rifts and differences,” he said, underlying the need to realise the dream of a shared future, which is one of the themes at this WEF edition.
Peppering his speech with quotes from Mahatma Gandhi, Rabindranath Tagore and the Upanishads, Modi said that as a representative of India, he could say that the country believed in “linking people and not dividing them”.
Highlighting the concept of “Vasudhaiva Kudumbakam (world is one family)”, Modi said that resolution of conflict was a way of life in India
“The essence of a family is that everyone comes together in solidarity. It is a matter of concern that strife among nations has made the challenges complex and harder… The challenge we face is daunting,” he said.
Like Chinese President Xi Jinping, who pushed for more open trade last year, Modi said the answer was not isolationism but formulating flexible policies in times of need.
The Prime Minister went on to list three major challenges for the world: climate change, terrorism and a growing number of countries now looking inwards.
“Everyone talks of reducing carbon emissions but few countries back it with words in terms of helping developing countries, citing the growing move towards greed-based consumption rather than need-based consumption. India is working on fighting climate change with the government now planning to push for the production of more renewable power by 2022,” Modi said.
On the threat posed by terrorism, Modi pointing out that it was dangerous to have an “artificial distinction” between “good terrorists and bad terrorists”. Another concern, he said, was “educated and well-to-do youth getting involved in terrorism…”
The third challenge, said the Prime Minister, was that a growing number of countries were now looking inwards and focussing on themselves, which was the opposite of globalisation. “It is time to review whether global organisations which were promoted years ago now represent the aspirations of many developing countries given that there has been no structural changes in these organisations,” he said.
In his pitch for investment in India, Modi said that the country’s vision for progress was inclusive. “Development is when all can participate and it is for everyone,” he said, referring to the opening of 30 crore new bank accounts and use of technology to ensure direct transfer of benefits or subsidies.
Saying that radical changes were underway with the mantra of “reform, perform or perish” and with an improvement in global rankings, it was far more easier and attractive to invest in India. “India’s youth was capable of building a $5 trillion economy by 2025 with innovation and entrepreneurship transforming them from job-seekers to job-creators…. Compared to a $400 billion economy in 1997, India has grown six-fold,” he said.
To many looking for reform signals or cues on the upcoming budget, Modi’s speech may not have yielded much but for many CEOs who attended sessions with the Indian delegation, the message was clear at Monday’s dinner meeting.
At the dinner, Modi spoke on the need to empower more people economically at the “bottom of the pyramid”, which could transform into opportunities in the local market and over time create demand globally.
As he wrapped up a day’s trip to the WEF, Modi also held two bilateral meetings with his counterparts from Canada and Switzerland.
Modi met Canadian Prime Minister Justin Trudeau who is visiting India next month with his family members and a business delegation. Vijay Gokhale, Secretary, External Relations, said that the two leaders referred to synergies in many areas and discussed trade ties. There was also a brief discussion on terrorism and how to combat it.
Substantial progress was made in talks with Switzerland, too, with negotiations underway on automatic exchange of information, specifically related to financial transactions. The agreement related to this exchange aimed at combating black money was ratified by the two countries last year.
Modi also met Queen Maxima of the Netherlands on the sidelines of the forum.
On Monday night, Modi attended a dinner with top CEOs, global and Indian, where he pitched for investment. Forty CEOs of firms based globally with a market capitalisation of $3.6 trillion and 24 CEOs from India attended the meeting, including the chiefs of Unilever, Pepsico, IBM and ABB.
Modi also had a brief interaction with some of India’s top CEOs after his Tuesday session. Those who attended included Lakshmi N Mittal, Mukesh Ambani, Anand Mahindra, Sajjan Jindal, G M Rao, N Chandrasekharan and bankers Rajnish Kumar, Chanda Kochhar, Uday Kotak and Rana Kapoor.