Editorial Simplified: Realizing Grand Objectives | GS – II

Relevance :  GS Paper II

Theme of the Article

Many regional policy challenges can be addressed with three major fixes.


While the broad directions of India’s foreign relations — with the neighborhood, Afghanistan, the U.S., China, Indo-Pacific, Russia, and Europe — have been set over the past several years, the main factors inhibiting India’s performance are ultimately domestic in nature.

Three Main Aspects

  • TRADE: Much of India’s commerce involves raw materials and low value-added goods, and is still insufficiently integrated into global supply chains..
  • DEFENCE: India has the world’s fifth largest defence budget but is also the world’s second largest arms importer. Not only does this compromise national security, it means that India cannot offer an alternative as a defence supplier to countries in its region.
  • OVERSEAS CREDIT: India’s outgoing aid budget has been relatively flat, reflecting a scepticism of grant aid from India’s own experience as a recipient. Instead, it has now started to explore other financing options.

Way forward

  • TRADE: With global trade stagnant and the World Trade Organization at a standstill, the only way for India to seize a larger share of exports is through well-negotiated preferential trade agreements. A smarter trade agenda will not only create jobs and drive reforms at home, it could become a potent strategic tool in international affairs.
  • DEFENCE: Defence indigenization will require financing for defence capital expenditure; assessments of costs, technology transfer capabilities, and export potential early in the procurement process; and fair competition between the Indian private and public sectors.
  • OVERSEAS CREDIT: Indian overseas credit has increased significantly, with over $24 billion extended primarily to South Asia, Southeast Asia, and Africa. But building on several recent steps will significantly increase the country’s delivery and regional credibility. These include better project planning, more attractive and competitive financing terms, more reliable disbursal of funds, and enhanced coordination and communication with the private sector for implementation.


Key policy interventions in these three areas will now be necessary for India to realise its grander objectives. Many regional policy challenges would be addressed with these three major fixes.