India: The next global superpower

India, the world’s largest democracy, is poised to rise to superpower status. This was the gist of an article published on Fortune magazine in 2015, prior to the visit of American President Barack Obama to India. The question of the country becoming a superpower is not a matter of how but when. From being a fledging economy, it rocketed into attaining an economic powerhouse status as the world entered the new century. 

After years of timid growth, the world is now expecting India to enter a higher rate of development and lead global economic growth.

This renewed optimism and dynamism can be attributed to the country’s pro-business and no-nonsense Prime Minister, Narendra Modi. Since coming to power, he has kickstarted a series of bold reforms which promise to transform the country and align it with its superpower ambitions. “The promise of a brighter future for India still holds firm,” said Fortune mag. There are three reasons for this:

The first is economic. Modi’s initiatives aimed at revamping India’s restrictive business regulations and creating a real free market seem to be working. Even though GDP growth in the third quarter of 2014 slowed slightly from the summer to 5.3%, it was still much higher than that of the last several years. India’s $1.9 trillion economy is projected to expand by 6.4% this year, according to the International Monetary Fund, and the country has already outpaced Japan as the world’s third largest economy in terms of purchasing price parity, a measure that adjusts for price differences between economies, according to the World Bank.

In addition, falling oil prices have reduced the risk of inflation and will enable the country to cut its costly fuel subsidies. Every a $10-a-barrel decline could increase GDP by 0.1%, lower inflation by 0.5%, and narrow the current account deficit. Further bolstering the economy is the billions of dollars in increased foreign investments, including $33 billion from private and public sources in Japan, aided by the raising of investment caps by the government and a stable interest rate environment.

The second part of Modi’s plan is to improve India’s national infrastructure. This includes a proposed increase in infrastructure spending of $800 billion to reach targeted economic growth of 7% as well as enabling banks to buy infrastructure bonds to spur trading activity in the debt markets. Late last year, Modi also secured a $20 billion infrastructure investment from China. Collectively, these initiatives could enable India to upgrade its overtaxed transport system, bring stable water supply and electricity to more areas, and expand the use of technology throughout the country.

But the most important aspect of India’s infrastructure is its human capital. What makes India’s population so valuable is its large pool of young workers – 65% of India’s population is 35 or under, giving the country a strong competitive edge in the coming decades. To realize the potential of this human capital, the government has launched several initiatives aimed at improving education, retraining rural workers for skilled jobs in other sectors, providing bank accounts to all Indians to teach personal financial planning, offering free life insurance, encouraging the wider use of computers and the Internet, and generally modernizing the workforce for the big jobs boom coming up in the fast-growing healthcare, information technology, telecom, and retail sectors.

The final factor that could position India as a superpower is its geopolitical advantage. Since his election, Modi has made a concerted effort to strengthen ties with Russia, Japan, and the U.S. For each of them, India is a valuable trading partner with a vast consumer base and labour pool waiting to be tapped. But even more significant is the strategic importance of its alliance with all those nations.

“India may not reach its desired destination in a straight line or in the timeframe that Modi has set for it, but odds are pretty good that it will become a leading player in the economic and geopolitical spheres fairly soon.”

India-Mauritius relations: An enduring friendship

Relations between Mauritius and India are very different from the established practice of international diplomacy. During his State visit to Mauritius, the Indian Prime Minister, Shri Narendra Modi, said: “We always stand in solidarity and support for each other. It comes naturally to us from our friendship and shared values.”

This quote sums well the fraternal relationship between the two countries, which dates back to the early 1730s, when artisans were brought from Pondicherry and Tamil Nadu. Diplomatic relations between India and Mauritius were established in 1948 before the island became independent.

There are nearly 11,000 Indian nationals in Mauritius. There are around 750 OCI Card holders and about 3500 PIO Card holders. To increase tourism inflow from India, Mauritian government had introduced a visa-free regime for Indian tourists in October 2004, wherein Indian tourists visiting Mauritius for a period up to 60 days do not require a visa, provided they can show sufficient funds to cover their stay.

Commercial Relations

India is Mauritius’ largest trading partner and has been the largest exporter of goods and services to Mauritius since 2007. In FY 2014-2015 India exported goods worth US$ 1.9 billion to Mauritius and imported goods worth US$ 21.19 million from Mauritius. India’s exports to Mauritius comprise largely of petroleum products. Besides petroleum products, main items of India’s exports to Mauritius are pharmaceuticals, cereals, cotton, electrical machinery, apparel and clothing accessories. Main items of Mauritius’ exports to India are iron and steel, pearls, precious/semi-precious stones and optical, photographic and precision instruments.

Eight Indian Public Sector Enterprises are currently functioning in Mauritius. The Bank of Baroda (BoB), Life Insurance Corporation (LIC), and New India Assurance Corporation (NIAC) were the first to establish operations, followed by other PSUs including India Handloom House, Telecommunications Consultant India Ltd (TCIL), IndianOil (Mauritius) Limited (IOML), Mahanagar Telephone (Mauritius) Ltd. and State Bank of India (Mauritius) Limited. Besides their core activities, the PSUs have also contributed to various activities in Mauritius under the Corporate Social Responsibility (CSR) schemes.

Some high-visibility Indian-assisted projects in Mauritius include the Mahatma Gandhi Institute, the Upadhyay Training Centre, the Jawaharlal Nehru Hospital, the Subramania Bharati Eye Centre, the Rajiv Gandhi Science Centre and the Rabindranath Tagore Institute. Prestigious symbols of recent Indian assistance include the Cyber Tower at Ebene and the Swami Vivekananda International Conference Centre (SVICC).