Day 48 Mains Questions – Ace Answer Writing Program

Question 1: Analyze the impact of protectionist policies adopted by developed countries on India’s economic interests, particularly in the context of trade and immigration. How should India navigate these challenges to safeguard its interests? (10 Marks, 150 words)

Introduction

Protectionist policies, such as tariffs and immigration restrictions adopted by developed countries, challenge India’s economic interests, particularly in trade and the mobility of skilled labor, affecting growth and global competitiveness.

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Impact on India’s Economic Interests –

1. Tariff Barriers: Increased tariffs by the US on Indian goods, such as steel and aluminum, reduce export competitiveness, impacting India’s trade balance.
2. Non-Tariff Barriers: Stringent standards and regulations in the EU restrict access to Indian agricultural products, limiting market opportunities.
3. Visa Restrictions: H-1B visa constraints in the US affect the Indian IT sector, reducing job opportunities for skilled professionals abroad.
4. Investment Barriers: Protectionist measures discourage foreign investment in India, particularly in the manufacturing sector, slowing economic growth.
5. Supply Chain Disruptions: Protectionism in developed countries leads to global supply chain disruptions, affecting Indian industries like pharmaceuticals.

Navigating the Challenges –

1. Diversifying Markets: Expanding trade relations with ASEAN and African nations can reduce dependency on Western markets, enhancing economic resilience.
2. Strengthening Domestic Manufacturing: Initiatives like ‘Make in India’ can boost local production, reducing the impact of import restrictions by developed countries.
3. Bilateral Trade Agreements: Negotiating favorable trade deals with countries like the UK and Japan can secure market access and mitigate protectionist impacts.
4. Promoting Service Exports: Enhancing competitiveness in service exports, such as IT and healthcare, can offset losses from restricted goods exports.
5. Skill Development Programs: Upskilling the workforce to meet global standards can mitigate the impact of immigration restrictions on India’s labor market.

Conclusion

Protectionist policies by developed countries pose significant challenges to India’s economic interests. By diversifying markets, strengthening domestic capabilities, and negotiating strategic trade agreements, India can safeguard its economic growth and maintain global competitiveness.

Additional Data and Committees for Value Addition –

1. WTO Negotiations: India’s stance in WTO discussions emphasizes the need to resist protectionism and promote free trade, crucial for its export-driven growth.
2. RCEP Withdrawal: India’s decision to withdraw from RCEP reflects its strategic approach to protecting domestic industries from potential adverse impacts.
3. Economic Survey 2021-22: Highlighted the importance of expanding trade partnerships and domestic manufacturing to navigate global trade challenges.

Question 2: Discuss the role of the Indian diaspora in shaping India’s foreign policy, particularly with respect to developed countries like the United States and the United Kingdom. How does the diaspora contribute to India’s global influence? (10 Marks, 150 words)

Introduction

The Indian diaspora, consisting of over 32 million people globally, plays a pivotal role in shaping India’s foreign policy, particularly with developed countries like the United States and the United Kingdom, by leveraging their economic, cultural, and political influence.

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Role of the Indian Diaspora in Shaping Foreign Policy –

1. Economic Contributions: The diaspora’s significant remittances, particularly from the US and UK, strengthen India’s economy and bolster bilateral ties.
2. Political Lobbying: Indian-Americans in the US and British Indians in the UK influence policy decisions through lobbying, evident in favorable immigration policies.
3. Cultural Diplomacy: The diaspora promotes Indian culture and values, enhancing India’s soft power globally, as seen in events like the International Yoga Day.
4. Strategic Partnerships: Diaspora-led businesses foster economic ties, facilitating trade and investment, exemplified by Indian tech professionals in Silicon Valley.
5. Crisis Diplomacy: The diaspora plays a crucial role during crises, such as mobilizing support for India during the COVID-19 pandemic through fundraising and advocacy.

Diaspora’s Contribution to India’s Global Influence –

1. Political Representation: Diaspora members holding key positions in foreign governments, like Rishi Sunak in the UK, enhance India’s diplomatic outreach.
2. Global Advocacy: The diaspora advocates for India’s interests on global platforms, influencing policy debates on issues like climate change and trade.
3. Innovation and Technology: Indian professionals in leading global companies contribute to technological advancements, reinforcing India’s image as a hub for innovation.
4. Educational Ties: The diaspora strengthens educational exchanges, leading to collaborations between Indian and global universities, enhancing knowledge sharing.
5. Public Diplomacy: The diaspora’s integration into host societies promotes a positive image of India, facilitating people-to-people connections and enhancing bilateral relations.

Conclusion

The Indian diaspora significantly shapes India’s foreign policy, especially with developed nations like the US and UK, by enhancing economic ties, cultural exchange, and political influence. Strengthening these diaspora links is crucial for expanding India’s global footprint and achieving its foreign policy objectives.

Additional Data and Committees for Value Addition –

1. MEA’s Diaspora Engagement: The Ministry of External Affairs (MEA) actively engages with the diaspora through initiatives like Pravasi Bharatiya Divas to strengthen ties.
2. High-Level Visits: Diaspora communities often influence high-level visits and bilateral summits, enhancing diplomatic outcomes, such as Modi’s visits to the US and UK.
3. India-UK Living Bridge: The concept emphasizes the role of the Indian diaspora in the UK in fostering deeper India-UK ties across various sectors.

Question 3: Examine the role of the World Trade Organization (WTO) in global trade governance. How has India’s engagement with the WTO shaped its trade policies, and what challenges does India face within this multilateral institution? (15 Marks, 250 words)

Introduction

The World Trade Organization (WTO), established in 1995, is a global institution that regulates international trade, ensuring that trade flows smoothly, predictably, and freely. India, as a founding member, has engaged with the WTO to shape its trade policies and advance its economic interests.

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Role of WTO in Global Trade Governance –

1. Trade Liberalization: The WTO promotes trade liberalization by reducing tariffs and non-tariff barriers, fostering global trade, as seen in the reduction of tariffs on industrial goods.
2. Dispute Resolution: The WTO’s Dispute Settlement Mechanism resolves trade disputes between member countries, ensuring fairness, as observed in the US-India poultry case.
3. Rule-based System: It establishes a rule-based trading system, providing predictability and stability, crucial for global trade investments.
4. Trade Negotiations: WTO facilitates multilateral trade negotiations, such as the Doha Round, aiming to create a fairer global trading system.
5. Technical Assistance: The WTO provides technical assistance to developing countries, helping them integrate into the global trading system.

India’s Engagement with WTO –

1. Agricultural Subsidies: India has actively defended its agricultural subsidies at the WTO, crucial for food security and rural livelihoods, as seen in the Food Security Act discussions.
2. Intellectual Property Rights (IPR): India’s stance in WTO negotiations has influenced its IPR policies, balancing innovation with access to medicines, exemplified by the TRIPS agreement.
3. Service Sector Negotiations: India advocates for liberalizing trade in services, reflecting its strength in IT and outsourcing, as seen in GATS negotiations.
4. Trade Disputes: India has successfully used the WTO’s dispute resolution mechanism to challenge unfair trade practices, such as the solar panel dispute with the US.
5. Export Policies: WTO rules have shaped India’s export policies, leading to diversification and adherence to global standards, evident in textile and pharmaceutical exports.

Challenges India Faces within the WTO –

1. Agricultural Subsidy Caps: Developed countries push for stricter limits on agricultural subsidies, challenging India’s ability to support its farmers.
2. Special and Differential Treatment (S&DT): India faces pressure to give up S&DT benefits, which protect its interests as a developing country in trade negotiations.
3. Dispute Settlement Delays: Increasing delays in the WTO’s Dispute Settlement Mechanism affect India’s ability to resolve trade conflicts swiftly.
4. E-commerce Regulations: India’s concerns about digital sovereignty and data protection clash with developed countries’ push for liberalizing e-commerce at the WTO.
5. Fragmentation of Multilateralism: The rise of bilateral and regional trade agreements undermines the WTO’s role, affecting India’s influence in global trade negotiations.

Conclusion

The WTO plays a crucial role in global trade governance, and India’s active engagement has significantly shaped its trade policies. However, challenges such as agricultural subsidy caps and e-commerce regulations require strategic navigation to protect India’s economic interests. Strengthening multilateralism remains key to India’s broader trade and economic objectives.

Additional Data and Committees for Value Addition –

1. Doha Development Agenda: India has consistently advocated for the conclusion of the Doha Round, emphasizing development issues.
2. Shanta Kumar Committee Report: Recommended reforms in India’s agricultural policies to comply with WTO norms while supporting farmers.