What India’s State Elections Mean for the West

By pressing the ruling Congress party on Iran, Western countries have hurt their ties with India.

India’s ruling Congress party was trounced in recent state elections especially in the all-important province of Uttar Pradesh. The trends reinforced by the results portent trouble for both India and the West.

First, chances of India joining the Iran embargo have ended — the dynamics explained earlier at the Atlantic Sentinel.

Almost on cue as news of the Congress defeat started filtering in, the Indian embassy in Washington went on an unusually aggressive defense of its Iranian oil imports. It claimed a “distorted picture of New Delhi’s foreign policy objectives and energy security needs” was being projected.”

India’s relationship with Iran is neither inconsistent with nonproliferation objectives, nor do we seek to contradict the relationships we have with our friends in West Asia or with the United States and Europe.

But the sting was in the tail. “Given the imperative of meeting the energy needs of millions of Indians, an automatic replacement of all Iranian oil imports, is not a simple matter of selection, or a realistic option.”

There was some number juggling there to show India’s consumption of Iranian oil had decreased of late. The reality is that the decline was due to the inability to pay Iran electronically (as is the norm) because of international sanctions.

Now that a rupee trade agreement with Iran has come into force, expect the graph to skyrocket again. No amount of innovative statistical interpretations is going to be able to explain it away. In fact, given the consolidation of Muslim votes (long seen as a captive Congress vote bank) away from the Congress in Uttar Pradesh, any Indian moves against Iran are a nonstarter.

If this were not bad enough, the policy paralysis that has gripped Delhi since 2009 will continue since the Congress’ bargaining position with its own left-wing allies has reduced dramatically.

The return of India to the notorious 6 percent “Hindu rate of growth” coincided with a London School of Economics study on “Why India Will Not Become a Superpower.” In short, if the Western alliance was hoping for a demographic, democratic and economic bulwark against China, India will not be it.

With prolonged policy paralysis and a looming water and food crisis on the horizon, expect the “rise of India” to turn into something of a nightmare.

Forget also the American-Indian nuclear accord hailed by President George W. Bush as “India’s passport to the world,” which is now not expected to move forward due to opposition to the liability clause.

Forget also the implementation of the Walmart direct purchase model, that was set to break the baneful influence of middlemen (a prime cause of inflation) and provide a much needed stimulus to agriculture as the Congress is expected to want to keep these middlemen in its good grace. They can, after all, engineer a “strategic” preelection price spike to wreck what little hope the Congress has left. Basically India is in soup and the West bet on the wrong horse.

To be fair, all these trends existed well before these elections. The problem is that the behavior that produced these trends are expected to be reinforced now rather than producing the predicted corrective reforms a Congress victory was to have heralded.

Two more important states go to the polls of which Gujarat may be the key. By all predictions Gujarat will stay with the conservative Bharatiya Janata Party under the leadership of Narendra Modi, a no nonsense development man who has maintained the state’s growth rate even under trying circumstances at a stellar 11.6 percent.

Should the conservatives elect Modi as their leader for the 2014 elections, he will be pitted against the severely underperforming Rahul Gandhi, the Congress’ crown prince.

The problem is that Modi is weighed down by allegations (nothing yet proven) of his complicity in the 2002 Gujarat riots. Modi, chief minister of Gujarat, the West could snub and name call publicly. But as the possible claimant to the largest democratic mandate on Earth, the West will face a very different problem if he is elected. India will never be Austria and Narendra Modi will never be Kurt Waldheim. Any criticism of him has thus far been painted by his campaign as an insult to all Gujarat and the focus of this demagoguery will presumably shift as he moved to the national stage to focus on external enemies.

In many ways, if India is repainting itself into geostrategic and economic irrelevance, the wWst has blundered badly. Continuing to pressure India on Iran will only lead to further political paralysis in Delhi with significant long-term strategic consequences.

At any rate, come 2014, the West will either have created a passively noncooperative left-wing India or a passively hostile right-wing one.