Wednesday, April 6, 2016

India Saudi Arabia

Prime Minister Narendra Modi’s visit to Saudi Arabia, arguably the leader of the Sunni Muslim countries in West Asia, clearly sets out the priorities of his government’s policy for the region. The Riyadh trip came eight months after Mr. Modi went to the United Arab Emirates, another Gulf nation and a member of the Saudi camp.

Historically, India’s West Asia policy has been multi-directional. During the Cold War years, India maintained close economic cooperation with both Saudi Arabia and Iran, the rival poles in regional geopolitics. Even when New Delhi warmed up to Israel in the 1990s as part of the country’s efforts to diversify its diplomatic engagement in the post-Soviet world, it was careful not to jeopardise the traditional relations with Muslim countries. The bi-directional approach has been expanded to a tri-directional foreign policy to accommodate the three key pillars of West Asia — Saudi Arabia, Iran and Israel.

Ties with Iran, however, took a beating during the sanctions years when New Delhi cut its energy cooperation significantly despite its vitality and huge energy potential. It was during the same time that India deepened cooperation with the Saudis. Mr. Modi’s visit to Riyadh should be seen against this background. His government appears to be following the regional policy set by its immediate predecessor. This approach, while not entirely giving up the tri-directional framework, is tilted more towards the Saudi camp and Israel. Mr. Modi is expected to travel to Israel this year, the first visit by an Indian Prime Minister to the Jewish nation. Many see the trip to Riyadh as part of New Delhi’s balancing act between the Saudis and the Israelis. On the other side, there appears to be a complete lack of interest on India’s part to reboot ties with Iran even after international sanctions on the country were removed following the nuclear deal.

The Saudi significance

To be sure, there’s a consensus in India’s foreign policy establishment that maintaining vibrant ties with Saudi Arabia is imperative to its national interest. Today, Saudi Arabia is India’s largest supplier of crude oil. That India is dependent on imports to meet around 70 per cent of the country’s energy demand itself makes Riyadh a vital player in the country’s quest for energy security. Besides, India is the largest recipient of foreign remittances from the kingdom. Of the 11 million Indians working in West Asia, nearly three million are in Saudi Arabia. Therefore, stability in the region, and particularly in Saudi Arabia, is high on India’s core agenda. But bilateral relations have gone beyond the economic realm in recent years, acquiring a strategic sense and pushing both countries to beef up their security partnership.

For decades, India was a passive player in West Asia — a beneficiary of good relationships with multiple actors. Despite the growing economic ties, political contacts between Saudi Arabia and India were at minimum till the Manmohan Singh government took office in 2004. West Asia acquired great significance in Dr. Singh’s world view; he even appointed a special envoy for the whole region. The January 2006 visit of the late King, Abdullah bin Abdulaziz, to Delhi set a new tone for bilateral ties. Dr. Singh reciprocated the visit in 2010 — the first Indian Prime Minister visiting Saudi Arabia in nearly 30 years — and signed the Riyadh Declaration, which set the framework for enhanced cooperation in the security, defence and economic spheres. Since then, there has been marked improvement in security cooperation and intelligence sharing between India and Saudi Arabia. Riyadh also extradited several terror suspects to India in a clear departure from its established policy towards New Delhi.

The broader framework for reactivating India’s Saudi ties was set in the post-9/11 world where counter-terror cooperation became a new diplomatic norm between terror-affected countries. Dr. Singh found it an opportunity to deepen security ties with Sunni Muslim countries, and Mr. Modi appears to be taking this policy a step forward. The main focus of his trips to both the UAE and Saudi Arabia was counter-terrorism. Both Abu Dhabi and Riyadh are Pakistan’s historical allies. The joint statements, issued in August with the UAE and this week with Riyadh, are unsurprisingly similar. And both have indirect references to Pakistan’s dual policy towards terrorism. It is clear that Mr. Modi is giving a Pakistan spin to the ‘Act West Asia’ policy of his predecessor. India’s objective appears to be to build a “counter-terror narrative” in diplomatic engagements with Pakistan’s close allies which could complicate the latter’s foreign policy. India would also not prefer to sit on the margins at a time when China is raising its profile in West Asia. Chinese President Xi Jinping recently visited Egypt, Saudi Arabia and Iran. The relationship between Beijing and Tehran is particularly going strong.

Enhanced ties with India are important for Saudi Arabia as well. The kingdom is facing economic strain in the wake of persistently weak oil prices. The U.S. is no longer as dependent on the region for energy as it used to be, thanks to the shale boom. Demand from China is also receding in the wake of a slowdown. Besides, competition in the oil market is expected to tighten with a sanctions-free Iran entering the global economic mainstream without any bars. In this context, India is a vital market for Saudi Arabia. There is believed to be friction between Islamabad and Riyadh over the former warming up to Tehran and their growing energy cooperation. Pakistan also refused to join Saudi Arabia’s war coalition that has been bombing Yemen for the past one year in the name of fighting the Iran-backed Shia rebels.

The sore points

But the question is how far both sides will go. Will Saudi Arabia abandon Pakistan and support India’s positions in multinational forums? The Saudis may like to use their growing relations with India to put pressure on Pakistan, but a structural overhaul of Riyadh’s South Asia policy is not on the cards. Pakistan, after all, is the country with an “Islamic bomb”, a “historic ally” of the Saudis. So if India, while reactivating its West Asia policy, looks only through the Pakistan prism, it might end up making strategic mistakes. Another sore point is the growing Saudi-Iran rivalry, which has always influenced West Asian geopolitics. By skewing its West Asia policy towards the Saudis, even though it might help meet its short-term goals, New Delhi also runs the risk of antagonising Iran at a time when the country is emerging a stronger player in West Asia post the removal of sanctions.

Then there’s the ideological problem. While Saudi Arabia denounces all forms of terrorism, Saudi money is funding Wahhabi Islamic groups around the world. Many extremist outfits are inspired by the Wahhabi branch of Islam. Saudi Arabia’s aggressive foreign policy in West Asia under King Salman bin Abdulaziz al Saud is doing great damage to regional stability, which is India’s most important goal in the region.

In Syria, the Saudi support for the rebels has played a key role in destabilising the regime, leading to the rise of the Islamic State. In Yemen, the war has unleashed chaos and a humanitarian catastrophe, creating conditions for radicalism to flourish.

So Saudi Arabia is not always a source of stability in West Asia, it is a disruptor too. India will have to factor these developments in its overall West Asia approach. The best way to do it is to restore the balance in its West Asia policy.

Panama Papers