South Asia Center Nonresident Senior Fellow Rajan Menon writes for the National Interest on why reports of India’s emergence as a great power are incorrect:
OVER THE last two decades, numerous books, articles and press commentaries have hailed India as the next global power. This flush of enthusiasm results partly from the marked acceleration in India’s economic growth rate following reforms initiated in 1991. India’s gross domestic product (GDP) grew at 6 percent per year for most of the 1990s, 5.5 percent from 1998 to 2002, and soared to nearly 9 percent from 2003 to 2007, before settling at an average of 6.5 percent until 2012. The upswing offered a contrast to what the Indian economist Raj Krishna dubbed “the Hindu rate of growth”: an average of 2.5 percent for the first twenty-five years following India’s independence in 1947. The brisker pace pulled millions from poverty, put Indian companies (such as Indian Oil, Tata Motors, Tata Steel, Infosys, Mahindra, Reliance Industries and Wipro) even more prominently on the global map, and spawned giddy headlines about India’s prowess in IT, even though that sector accounts for a tiny proportion of the country’s output and workforce. India also beckoned as a market for exports and a site for foreign investment.
The attention to India has endured even though its economic boom has been stymied, partly by the 2008 global financial crisis, with growth remaining below 5 percent for eight consecutive quarters from early 2012 to early 2014. In the quarter lasting from April to June 2014, growth ticked back up to 5.7 percent, but it is too soon to tell whether or not this represents the beginning of a more sustained expansion. The persistent interest also stems from analyses that portray India’s and China’s resurgence as part of a shift that is ineluctably returning the center of global economic power to Asia, its home for centuries before the West’s economic and military ascent some five hundred years ago. Yet even those who dismiss the proponents of this perspective as “declinists” are drawn to the “India rising” thesis, in part because of the transformation in U.S.-Indian relations during the last two decades and the allure of democratic India as a counterweight to authoritarian China. For much of the Cold War, the relationship between Washington and New Delhi ranged from “correct” to “chilly.” Nowadays, in contrast, predictions that China’s ascendency will produce an Indo-American entente, if not an alliance, are commonplace.