The India Myth

http://nationalinterest.org/feature/the-india-myth-11517?page=show

The ubiquitous reports of India’s emergence as a great power are bogus. The road is long, the advance slow and the arrival date uncertain.

Rajan Menon

October 23, 2014

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.

But is India really ready for prime time? India has many of the prerequisites for becoming a center of global power, and, assuming China’s continued and unhindered ascent, it will play a part in transforming a world in which American power is peerless into one marked by multipolarity. India has a vast landmass and coastline and a population of more than one billion, faces East Asia, China and the Persian Gulf, and has a wealth of scientific and technological talent along with a prosperous and well-placed diaspora. But the elemental problems produced by poverty, an inadequate educational system and pervasive corruption remain, and India’s mix of cultural diversity and democracy hampers rapid reform. For now, therefore, the ubiquitous reports of India’s emergence as a great power are premature at best. There’s no denying India’s ambition and potential, but as for its quest to join the club of great powers, the road is long, the advance slow and the arrival date uncertain. Prime Minister Narendra Modi of the Hindu-nationalist Bharatiya Janata Party (BJP) may seek to be a reformer, and he enjoys a reputation as a charismatic leader and skilled manager. He is also a proponent of improving ties with the United States and Israel. But he will face daunting obstacles in his bid to push India into the front rank of nations.

DESPITE ITS many blemishes, India’s democracy has increased the country’s appeal in Europe and America and prevented quarrels over human rights from complicating the expansion of economic and security transactions with the West. This is in stark contrast to the intermittent skirmishes over human rights that have marred the West’s relationship with China and Vladimir Putin’s Russia. In defending the 2005 U.S.-Indian nuclear agreement, the George W. Bush administration (and American experts who backed the deal) noted that India is a fellow democracy. Barack Obama—who hosted Modi in September 2014—pledges to back India’s bid for a permanent seat on the UN Security Council and invariably invokes the country’s democratic record when he does so.

Yet in East and South Asia, two regions in which India has been most active on the diplomatic and strategic front, its democratic model hasn’t yielded it much influence, or even stature. If anything, the economic achievements of China and Singapore—and the other Asian “tigers” during their undemocratic decades—in delivering rapid growth and modernization and improving living standards have made a bigger impression. India, weighed down by the compromises, delays and half measures necessitated by its democratic structure, comes across as a lumbering, slow-motion behemoth that’s never quite able to sustain whatever momentum it manages to gain on occasion or to bridge the gap between proclaiming reforms and implementing them.

The Indian government, for its part, has crafted sundry soft-power slogans and strategies, among them “India Shining” and the even sappier “Incredible India.” The latter was not simply rhetorical excess—though it was that—or even solely a catchphrase to capture additional tourist revenue. It was also part of a larger effort to increase transactions between India and the West and to recast India’s image. Yet there’s scant evidence that India is seeking to use culture as a means to create a transnational bloc in Asia, or anywhere else. With all due respect to the late Samuel P. Huntington, who listed “Hindu civilization” among the cultural-religious blocs whose rivalry he believed would supplant the competition and conflict among states, there’s no sign that India plans to mobilize that form of soft power, or that it could if it tried. Hyping Hindu discourse in a multiconfessional country, one with more than one hundred million Muslims, would amount to jeopardizing internal security to road test a quixotic theory that emanated from Harvard Yard. Besides, Hinduism is too torn by divisions of class, caste, language and region to make such a strategy feasible; the Hindu diasporas in Asia and Africa, for their part, would have little to gain and much to lose by embracing it. Modi and the BJP will doubtless spice up their rallies with Hindu-nationalist verbiage, but they are likely to find that this tactic, far from mobilizing unity, sows disunity in what is a country of multiple faiths and provokes India’s neighbors, above all Pakistan, while yielding little of tangible value in return. Nor will the project of “Hindutva” help the BJP extend its base beyond northern India’s “Hindu heartland” and into the country’s southern regions, where its message has much less appeal.

The difficulty with “soft power,” a concept now embedded in the lexicon thanks to another Harvard professor, Joseph Nye, is that it’s hard to determine its effectiveness, or even to figure out quite how it works. Few would deny that a country’s political system, cultural achievements and image can, in theory, add to its allure. What’s much less clear, though, is how this amorphous advantage goes beyond evoking warm feelings and yields actual influence, defined as the capacity to shape the policies of other countries.

Did Americans (or Europeans or Japanese) gain a greater understanding and appreciation of India and begin to take it seriously because of India’s soft power? Unlikely, given how little the outside world interests the citizens of the United States, never mind that their country is engaged in every corner of the globe on a host of issues and in ways that affect the lives of millions. Did the greater coverage of India, in part perhaps because of New Delhi’s endeavors on the soft-power front, increase the attention it received from America’s well educated, well heeled and politically powerful? Possibly, based on the data on tourism, the increased number of courses on India-related topics at universities, and the growing popularity of Indian prose-fiction writers and attire bearing traces of Indian culture. But one can yearn to see the Ajanta Caves, read R. K. Narayan or Arundhati Roy, sport a kurta, or be able to tell one genre of Indian classical music or dance from another without giving so much as a thought to the pros and cons of developing military ties with India, championing its quest for a spot on the UN Security Council, or expanding trade and investment ties with it. Soft power, apart from being a slippery principle, can only do so much in practice. It simply cannot compensate for the deficit India has in other, tangible forms of power, which remains the greatest impediment to India’s becoming a global power.

THE HEYDAY of central planning and import-substitution-based economic policy, which had extraordinary influence in India, is over. The BJP’s thumping victory over the Congress Party, which itself initiated economic reforms in the 1990s, betokens an even stronger push toward privatization and foreign direct investment (FDI). While the principal aims of India’s economic strategy will naturally be growth and prosperity, the country’s leaders understand the strategic benefits that are to be gained from having the business community of important democratic countries (the United States, Britain, Japan, Germany, France, South Korea and Brazil, for example) acquire a strong stake in India’s market.

Still, to gain substantial economic influence, India’s leaders will have to implement many politically unpopular reforms that are required to restore and maintain high rates of growth, boost trade and attract greater sums of FDI. These include cutting subsidies for basic commodities, revamping entrenched and rigid labor laws, opening protected sectors—such as retail, agriculture and services—to foreign competition, and stamping out tax evasion, which in India is both ubiquitous and an art form. These aren’t the only steps needed to make the economy grow faster and more sustainably so that the increased resources required to bolster India’s bid for great-power status become available.

Take education. While India’s progress in educating what fifty years ago was a largely illiterate society has been impressive, there’s much more that needs doing on this front to boost Indian economic power. The countries that are already front-rank economic powers achieved near-universal literacy long ago, while in China, Indonesia and Malaysia more than 90 percent of the population is literate. In India, the figure is 74 percent. While that’s a massive increase compared to the proportion in 1947, the quality of Indian schools is uneven because problems such as moribund curricula, substandard classrooms and widespread absenteeism among teachers abound. The success of states like Kerala, Tamil Nadu and Himachal Pradesh contrasts starkly with the failures of the educational system in others, such as Bihar, Uttar Pradesh and Madhya Pradesh. What might be called the “effective literacy rate” is thus lower than suggested by the national average, especially in rural areas (where about 70 percent of the population still lives) and among females. Moreover, India’s schools are not producing the skilled labor needed by local and foreign firms at anywhere near the required rate, and too many of those with degrees in science and engineering are not readily employable on account of the poor quality of their training. Indian higher education has a proud history that spans centuries and boasts some venerable institutions, but according to economists Jagdish Bhagwati and Arvind Panagariya, even its elite engineering and management schools don’t make the “top 200” list in global surveys; by contrast, the best universities of other major Asian economic powers have cracked the top 100.

Likewise, vast sums will have to be mobilized (from tax revenues or government-backed, dollar-denominated bonds) to modernize and expand India’s antediluvian infrastructure. The list of pressing needs is long. It includes building or revamping water-management and sanitation systems; bridges, railways and roads; harbors and airports; and power plants (to end chronic electricity shortages and even blackouts). Fixing India’s infrastructure by building more rail and air networks, bridges and ports won’t be cheap: the price tag is estimated to be $1 trillion. But absent a colossal effort, the drag on India’s growth could amount to 2 percent a year. Access to computers and the Internet must also be scaled up dramatically if India is to compete successfully in the global marketplace. Despite the publicity India’s prowess in IT receives, society-wide access to information technologies remains unimpressive. In 2008, according to the World Bank, India had 7.9 Internet users per 100 people. That number had grown to 15.1 by 2013. But by then Guatemala had 19.7, Haiti 10.6, Kyrgyzstan 23.4 and the Dominican Republic 45.9. The figure for China was 45.8, in Germany and France and the United States it was over 80, and in Denmark it was 94.6. Even allowing for India’s mammoth size and population, this dismal comparison speaks for itself.

India faces an even more fundamental problem—one that makes prognostications about its impending ascent to great-power status sound surreal. Simply put, the country still lacks the human capital required for acquiring the power and influence commensurate with its leaders’ aspirations. Consider some pertinent numbers. India’s per capita income in 2013 was $5,350. By comparison, China’s was $11,850, Japan’s was $37,630 and—tellingly—South Korea’s, which was comparable to India’s in the early 1950s, was $33,440. Nearly one-third of Indians still subsist on $1.25 a day or less. India places 135th out of 187 on the UNDP’s Human Development Index, a composite measure of access to basic necessities. Similarly, it ranks 102nd out of 132 on the Social Progress Index, which assesses countries’ records in meeting people’s essential social and economic needs. In UNICEF’s rankings, India (with 48 percent) places fourth in the proportion of children who are stunted and second (43 percent) in the percentage of those who are underweight (“severe” or “moderate”). The handful of Asian countries with worse records includes Afghanistan, Pakistan, Myanmar and Papua New Guinea—not good company for a country that yearns to be global power. As Jean Drèze and Amartya Sen demonstrate in a recent book, despite its robust economic growth during much of the last two decades, India lags far behind the other “BRICS” in such measures as citizens’ access to potable water and basic health and sanitation services, the immunization of children and nutrition. Worse, its performance is poor even relative to some of the world’s poorest countries. In India’s own neighborhood, Bangladesh and Nepal, despite having smaller per capita incomes and slower growth rates, have done better on several key quality-of-life measures.

Among the consequences of having shopworn infrastructure, relatively low literacy rates and a substandard educational system, along with an industrial manufacturing sector that’s small relative to that of its competitors—all problems that the Asian “tigers,” and China thereafter, overcame—is that, as wages in China have risen, multinational corporations haven’t relocated to India to the degree one would expect given the size of the Indian market and the low cost of Indian labor. Instead, they have gone elsewhere—not just because of India’s inadequate human capital and infrastructure, but also because of bureaucratic barriers that hinder business and investment and persist despite the reforms of the past two decades. These problems help explain why India places 134th out of 189—just below Yemen—in the World Bank’s “Ease of Doing Business Index.” Not surprisingly, India attracts far less FDI than it needs to boost growth and productivity. From 2010 to 2012, FDI inflows to India averaged $27 billion a year, compared to $119.5 billion for gargantuan China, $55 billion for tiny Singapore and $60 billion for Brazil, a member of the BRICS coalition to which India belongs. Malaysia attracted $10.3 billion and Thailand $8.3 billion—both far more than India in per capita terms. Yet the former has a population of thirty million (2.3 percent of India’s) and the latter sixty-seven million (5 percent of India’s).

It’s often said that India, unlike China, has the advantage of a relatively young population and will therefore not face labor shortages. What often goes unmentioned is that the largest population increases are occurring in some of India’s poorest states (Madhya Pradesh, Uttar Pradesh and Bihar), not in those (such as Kerala and Tamil Nadu) that have been the best at meeting basic economic needs and in increasing literacy.

These same deficiencies have prevented India from establishing a significant position in global trade. While it does rank fifteenth on a list of the top twenty economies in the dollar value of merchandise trade, its exports and imports combined in 2012 totaled $784 billion. Several countries with smaller GDPs and much smaller populations outranked it, including Singapore, Belgium and the Netherlands. China’s trade, valued at nearly $4 trillion and about on par with that of the United States, accounted for 10.5 percent of the value of all international trade in 2012. The dollar value of India’s trade amounted to one-fifth of China’s and to 2 percent of the global total, even though India has roughly 17.5 percent of the world’s population, about the same proportion China does. India does fare better in trade in commercial services: in 2012, it ranked seventh in a list of the top exporting countries; but its share was still only 74 percent of China’s (which still lacks a powerful service sector) and 4.4 percent of the world total, comparable to that of Spain and the Netherlands.

Apart from the quantity and complexity of the problems that have to be addressed, India’s democratic system is not conducive to enacting controversial economic changes quickly. Because of their authoritarian political systems, China, as well as Taiwan and South Korea in their nondemocratic phases, could push through sweeping reforms that helped establish the foundation for rapid industrialization and economic growth. India’s raucous, vibrant democracy is rightly admired, but it impedes the implementation of deep economic reform. Creaky coalition governments are common at the center, and headstrong local power brokers (the chief ministers of its twenty-nine states) can be veritable kingmakers. Labor unions are powerful, and militant and caste-based political alliances are impenetrable yet influential. Then there’s an electorate that’s not shy about registering its displeasure at the ballot box when economic reforms bring pain or when the increased competition from abroad threatens traditional sectors, such as small retail shops, agriculture or industries long shielded by various forms of protectionism. In principle, Modi, who faces the challenge of overcoming such obstacles, is well placed to do so given his economic track record, his popularity and the BJP’s massive electoral mandate. Modi may style himself as a no-nonsense, business-friendly, results-oriented manager, but he won’t be able to demolish these deeply rooted impediments to reform without a tough struggle. Running Gujarat was one thing. Acting as India’s CEO will be quite another.

DURING THE past two decades in particular, Indian leaders have looked beyond their immediate neighborhood and adopted a more ambitious strategy. The “Look East” policy, a case in point, seeks to expand and deepen India’s presence in East Asia so that China does not have a free hand in shaping the strategic and institutional landscape there. More to the point, it is designed to strengthen security ties with the Asian countries located around China’s perimeter, particularly those unnerved by the prospect of a Pax Sinica and anxious about America’s staying power and the narrowing gap in power between the United States and China.

India has been active on a variety of fronts in East Asia. It has been training Myanmar’s naval officers and selling the country maritime surveillance aircraft. It has provided Vietnam loans for buying Indian arms and has signed a deal, despite profuse Chinese protests, to tap Vietnamese oil deposits in the South China Sea, adjacent to islands claimed by Beijing. It has been engaged in regular security consultations with Japan, Israel, Australia, Indonesia and the United States, and has participated in naval exercises in the Pacific alongside America, Japan, Singapore and Australia. It also signed a free-trade agreement with the Association of Southeast Asian Nations in 2009. While specialists on Indian foreign policy tally these and other triumphs with care, what’s sometimes missing from their analyses is a comparative perspective, which would show that China’s presence in East Asia, and the resources it has deployed to gain influence there, far exceed India’s on every dimension that matters, and by a wide margin.

Another part of India’s strategy has been expanding the power and reach of its armed forces. Much has been accomplished, and the balance between India and China is a far cry from what it was in 1962, when a military rout that revealed Indian troops’ lack of basic equipment created a political firestorm at home. The Chinese would find it considerably harder now to prevail swiftly in a war along the border. Still, India trails China in military power, and a quick comparison makes the disparity evident. Though the two countries have populations of comparable size, India’s GDP is a mere 22.5 percent of China’s. This gap gives Beijing a big advantage in mobilizing and applying various power-relevant resources—and one that is likely to widen given that China’s rate of growth, though it has slowed of late, still exceeds India’s. India and China have devoted a comparable proportion of GDP to defense in recent years: about 2.5 percent and 2.0 percent between 2008 and 2013, respectively. Yet because of the GDP disparity China can, with a smaller burden on its economy, spend far more on its military machine than India: $188 billion compared to $47 billion in 2013. The actual gap is likely even larger, as China’s official figures probably understate its true level of defense spending.

Nor is it just a matter of the spending mismatch: whether it’s armor, airpower, cyberwarfare, air-defense systems or power-projection capacity, China retains a significant advantage over India, in qualitative and quantitative terms. Some numerical comparisons of major categories of armament make this evident. In combat aircraft, attack helicopters, submarines and destroyers, China’s lead ranges from 2:1 to 4:1. Some strategists, Indian and Western, aver that the Indian navy now has the wherewithal to establish dominance over its Chinese counterpart and to block the lifeblood of the Chinese economy by controlling maritime passageways that provide China egress from East Asia. Leaving aside the fact that this scenario assumes a full-blown war in which the naval balance would be but one factor, the difficulty New Delhi faces is that China has far more economic resources than India to devote to seapower in the coming years. Besides, in 2013, the Indian navy received only 18 percent of the military budget, compared to 49 percent for the army and 28 percent for the air force, and a reallocation of resources, certain to be contentious, would be required to ensure maritime dominance over China. That’s possible in principle—leaving aside the inevitable interservice budget battles—but not easily accomplished given the threats India faces from the land and air forces of China and Pakistan, who continue to be aligned. Even if one concedes the claim about Indian naval superiority, Beijing can apply counterpressure in various ways, particularly by bolstering Pakistani military capabilities, using its well-developed strengths in cyberwarfare and striking across the Sino-Indian border. Even with India’s recent move to further strengthen its border defenses by creating a “mountain strike corps” of fifty thousand troops, the Chinese are likely to retain the advantage in numbers, mobility and firepower—and thus the wherewithal to mount offensive operations across the three main sections of the border: Ladakh-Xinjiang, Tibet-Uttarakhand and Arunachal Pradesh-Sikkim.

Modi has his work cut out for him. He will doubtless seek to reform India’s defense industries but will have to continue relying mainly on external suppliers. Russia, whose armaments dominate India’s army, navy and air force, will retain a natural advantage. But in recent years India has been dissatisfied by cost overruns in Russian armaments, the unreliability in the supply and quality of spare parts, and accidents aboard Russian-built submarines, and so it has sought to reduce its dependence on Moscow. Modi won’t burn bridges with Russia, but he will open the door more widely to American, European and Israeli suppliers. While Israel will remain a niche supplier for India, since the establishment of diplomatic relations in 1992, trade between the two countries has grown (it totaled $6 billion in 2012); so have Israel’s military sales, which cover radars, missiles of various sorts and reconnaissance aircraft. India has become Israel’s leading market for its arms exports, the annual worldwide total value of which is $7.5 billion, with India accounting for as much as $1.5 billion. Such transactions, which include intelligence sharing related to counterterrorism, are no longer controversial within India; Modi, who visited Israel while running Gujarat and attracted billions of dollars of Israeli investment in his state, has voiced his admiration of Israel’s economic and technological achievements and his desire to boost cooperation.

New Delhi’s strategy toward China goes beyond strengthening India’s armed forces. Since the bilateral military balance heavily favors Beijing, India has turned to a classic coalition strategy aimed at dispersing China’s military strength across what, given the size of the Chinese landmass, are far-flung fronts. This gambit, already well under way, will gain momentum. For reasons rooted in history and geography, India’s natural partners will be Australia, Indonesia, Japan, Vietnam and the United States, countries with which India’s military ties have grown during the last two decades. The increasing security cooperation between New Delhi and Tokyo in recent years is particularly significant and will increase because of their shared apprehensions about China. Given Japan’s economic and technological prowess, it could—if the increasing threat from China trumps domestic opposition—boost its military strength in fairly short order. With a GDP approaching $5 trillion, barely 1 percent of which it devotes to defense, this would only require a minimal increase in the defense burden. While East Asian states have been rattled by Prime Minister Shinzo Abe’s efforts to revise Japan’s “peace constitution” and to increase its military capabilities, India has welcomed them and embraces Japan as a strategic partner. In 2014, Japan and India decided to begin regular consultations between the two countries’ national-security leaders. This decision followed the initiation of yearly trilateral meetings among India, Japan and the United States in 2011. There is more involved in this than talk. Japan has participated in three—in 2007, 2009 and 2014—of the annual U.S.-Indian “Malabar” naval exercises, which were initiated in 1992 (they were suspended following India’s nuclear test in 1998). What bears watching is whether Japan’s 2014 decision to lift the ban—which dates back to 1967—on the export of military technology and arms leads to purchases by India as part of its push for military modernization and diversification. Tokyo’s 2013 offer to sell India the ShinMaywa US-2 amphibious aircraft, and India’s interest in buying fifteen of them, may represent a harbinger. Already, Japan and Australia have been in discussions over the latter’s purchase of ten Soryu-class Japanese submarines (worth $20 billion), a development that points to the potential for larger arms sales by Japan to India, especially given their shared concern about China’s expanding power.

USING DIPLOMATIC and economic means, India is also establishing a presence on China’s western and southwestern flank, in Afghanistan and Central Asia. It has positioned itself to play a major role in post-American Afghanistan by training Afghan security forces, building road networks and acquiring natural-resource deposits. But China has also been purchasing economic assets in Afghanistan, notably in energy and mining, and once the United States and its allies depart, Beijing will have to develop a strategy to defend these gains, which means that its presence in that country will grow, adding a new front to Sino-Indian competition.

China has overshadowed India in Central Asia, despite the emphasis the region receives from Indian strategists and New Delhi’s efforts to strengthen its position. India remains an observer rather than a full member in the Shanghai Cooperation Organization, among the many sources of Chinese influence in Central Asia. Indian energy companies have been bested by their Chinese counterparts in bids for shares in Kazakh companies and energy fields, most recently in the giant Kashagan offshore field, among the largest in the world. Pipelines recently built by China are drawing increasing volumes of Kazakh and Turkmen energy eastward. Trade and investment trends show that Beijing’s economic presence is fast overshadowing Russia’s, to say nothing of India’s, in what has been a Russian sphere of influence since the nineteenth century. India’s position is even weaker in the military sphere. Unlike China and Russia, it lacks direct access to the region. Its quest for access to the Ayni air base in Tajikistan, its first attempt to gain a military toehold, ran into Russian opposition—no matter that New Delhi had spent some $70 million to renovate it—and so Ayni’s operational value to India as a combat-aircraft platform remains uncertain.

The United States will be the key partner in India’s coalition strategy because it has more power to bring to the grouping than any other country and because Sino-American competition seems likely to intensify. Developments such as the 2005 U.S.-Indian nuclear deal—which effectively marked Washington’s recognition of India as a nuclear-weapons state and an abandonment of its punitive antiproliferation approach to New Delhi—have produced predictions of an alliance in the making. This forecast is faulty. For one thing, it makes light of the political obstacles within India, which are a legacy of Cold War frictions and the abiding suspicion, even animus, toward the United States within India’s left wing and on the nationalist right. It also underestimates India’s apprehensions about the loss of autonomy that could follow an alliance with the United States, a sentiment that persists in a country that has prided itself on hewing to nonalignment. These are among the reasons New Delhi has opted for a flexible, ambiguous position, one that’s unlikely to change under Modi, even as he expands the security cooperation with the United States that’s already in place. India has forged multiple ties with the United States and Europe, but it also has continued high-level political exchanges with China and is seeking to increase Sino-Indian trade. (China has become India’s biggest trade partner.) Moreover, during Chinese president Xi Jinping’s September 2014 visit to India—the first by a Chinese president in eight years—the two leaders signed a deal providing for $20 billion in Chinese investment in India’s infrastructure, especially railways, over five years. This was despite the controversy created by Chinese soldiers’ encroachment across the (still undemarcated) border, which coincided with Xi’s trip.

This multifaceted strategy is New Delhi’s likely course for the future. It gives India greater flexibility than would an alliance with the United States and provides two attendant advantages. First, India can expand ties with the United States on all fronts, calculating that Beijing will be forced to take account of America’s likely reaction should China contemplate coercive action against it. Second, India can improve its bargaining position against China, which will want to forestall the tightening of military bonds between India and the United States. A definitive alliance with America would deprive New Delhi of that strategic flexibility. As his predecessors did, Modi will continue to see China as India’s main security threat, but it’s simplistic to see him as a mere Sinophobe. He has expressed admiration on several occasions for China’s economic achievements and, while governing Gujarat, visited China and succeeded in attracting more Chinese investment than the chief minister of any other Indian state.

IF CHINA presents problems for India, then Pakistan remains an even more acute one. The nature of India’s Pakistan predicament has changed in three fundamental and unprecedented ways. First, India’s conventional military advantage will be harder to use to good effect, because threats of war will be less credible now that the specter of nuclear escalation looms. This risk will be present in any war in which Pakistan suffers heavy losses, and will even constrain what India can do in response to another major terrorist attack that it traces to Pakistan. Stated differently, the greater the conventional military advantage India acquires over Pakistan, the more dangerous it may be to employ it. That’s something that Modi will have to reckon with, even as his tough-guy image will put him under pressure to respond forcefully to Pakistan-based terrorism.

Second, Pakistan’s weakness is also starting to worry Indian strategists. Should Pakistan, which is beset by internal violence, fragment, India will face serious problems. Refugees will flow east. Jihadist groups will be able to operate with greater leeway in Kashmir, and even the rest of India, in the absence of a robust Pakistani state that can be pressured to hold them in harness. It’s not clear how such threats can be managed by utilizing India’s economic and military superiority.

Third, nuclear weapons, by raising the risks involved in waging conventional war, provide Pakistan more opportunities to support extremist Islamist groups whose targets now extend beyond Indian-controlled Kashmir and include, as the 2001 attack on the Indian parliament and the 2008 attack on Mumbai showed, the Indian heartland. India has about as many Muslims as Pakistan does, and the repression of Indian Muslims, or a popular backlash against them following terrorist attacks inside India, could generate domestic violence and upheaval that alienate an important and substantial segment of Indian society while empowering India’s radical nationalist forces. The result would be a vicious circle of violence that begets more violence and proves disastrous for India’s future.

It’s unclear whether Modi will be able to overcome these problems. Despite his smashing electoral victory, his success in office is anything but assured. The BJP, while generally seen as more favorable to private enterprise than the Congress Party (notwithstanding that it was on the latter’s watch that many of India’s market-friendly economic reforms were adopted), still contains constituencies committed to economic nationalism. They view globalization as a recipe for deindustrialization, foreign domination over key economic sectors, and impoverishment for small businesses and farmers. Their views, though sidelined in the 2014 campaign, could regain influence if Modi’s economic policies falter or cause pain without producing visible gains for ordinary Indians. India the superpower? Don’t bet on it.

Rajan Menon is Anne and Bernard Spitzer Professor of Political Science at the Colin Powell School of the City College of New York/City University of New York, a nonresident senior fellow at the Atlantic Council, and a senior research scholar at the Saltzman Institute of War and Peace at Columbia University.