Modi’s Middle Way

How many acronyms can one invent to signal a country’s foreign policy interests? Many, if you are Narendra Modi. The Indian prime minister recently spoke about an India-France “In-Fra” alliance. Last year he reportedly coined or popularized the JAI (Japan, America, India) and RIC (Russia, India, China) trilaterals. There’s also his SAGAR concept (Security and Growth for All in the Region). Modi’s schedule at the nineteenth G20 summit in Osaka reflected not only his personal passion for acronyms but also his country’s policy to diversify options and craft a fine balance between the United States, China, and several other regional powers. As noted by one of India’s leading strategic affairs editors, Suhasini Haider, “rarely have meetings on the sidelines around one summit carried as much import on India’s future policies as the G-20 summit in Osaka.”¹

During his 48 hours in Japan, the Indian prime minister held nine bilateral meetings with the leaders of the United States, Japan, Saudi Arabia, South Korea, Germany, Indonesia, Brazil, Turkey, and Australia and also six pull-aside meetings with his counterparts from Thailand, Vietnam, France, Italy, Singapore, and Chile. Most importantly, he engaged two rather contrasting geostrategic trilaterals with equal excitement. The JAI meeting with President Trump and Prime Minister Abe discussed the “Indo-Pacific region and how the three countries can work together in terms of connectivity, infrastructure, and ensuring that peace and security is maintained.”² In contrast, in an allusion to the American hegemon, at the RIC meeting with presidents Putin and Xi, Modi professed to “promote a multi-polar world, a world in which there are many centers of influence and stability.”³

Modi’s “delicate” balancing act is not a radical departure but more of a reworking of India’s classic non-aligned posture. Most recently defined in the words of a retired Indian diplomat who served as foreign secretary, Shyam Saran, “the stronger and more diversified relations India has with all the major powers, [the more it] helps us deal with our challenges. […] Whether it is the US, China or Russia, each one will try to push India in a direction it likes and it is for us to make our decision on how to balance these contrary pressures.”⁴

The Modi version of India’s balancing act is focused on pursuing a middle way: limiting Indian exposure to the increasingly conflictual Sino-American dynamics by keeping decent relations with both Washington and Beijing, giving minimally necessary love to Russia, and also deepen partnerships with other middle powers such as Japan, Australia or France and the European Union. In parallel to pursuing this geostrategic equilibrium, India will also have to work hard at home, since Modi’s maneuvering ground for external acrobatics hinges on his domestic ability to increase his country’s limited economic and military capabilities.

In this article, rather than a mere explanation of Modi’s middle way, I also identify the blind spots ahead: India’s non-aligned and dual strategy is not without dangers because it often boils down to a lazy attempt to just muddle through. Can India, as so many times in the past, afford to ignore strategic forks in the road and instead of pursuing bold alignments, continue to thread its middle path through an increasingly dark jungle?

Keeping balance on the global tightrope

Modi’s balancing act in search of a diplomatic middle path reflects India’s tradition of strategic diversification: the more you spread your risk, the greater your decision-making autonomy. But this strategic mantra comes with two important caveats. First, the terms of diversification depend on a subjective self-assessment about Indian capabilities and its attractiveness to other, more capable powers. Delhi still remembers the trauma of 1998, when its decision to go nuclear was greeted with diplomatic hostility and sanctions that then almost crippled its embryonic market economy. The second caveat to India’s diversification strategy relates to the domestic debates on how best to spread India’s eggs into different baskets. Unlike with China, in India’s democratic system, with several competing bureaucratic, partisan, and ideological worldviews, rambunctious geostrategic discussions are generally the norm. Both within the decision-making system and a civil society animated by 900 million registered voters, the government’s strategic realignments often comes under popular pressure, as during negotiations toward the civil nuclear deal with the United States (2005-08).

The world order’s current volatility has naturally, once again, animated this eternal Indian debate about the tactical terms of strategic diversification. For Samir Saran, the president of the influential Observer Research Foundation, India is now “walking the tightrope between Eurasia and the Indo-Pacific” and must carefully define its interests between “competing initiatives” such as the Belt and Road Initiative (BRI) and the Free and Open Indo-Pacific (FOIP).⁵ Suhasini Haider, in turn, is even more explicit: India now faces “a fork (in the road) where the US holds one prong and the Russia-China axis holds the other.”⁶

Few Indian observers question the importance of strong relations with the United States. Most would also concur that China is a rising competitor and also a possible challenger or even threat to Indian interests. Many analysts will point to the renewed importance of Russia as a time-tested Indian partner. There is also a large consensus around Japan as an indispensable friend and quasi-ally. The great differences, however, reside in the small detail of how exactly India should balance all these—often competing and conflicting—friends, partners, and allies into a bundle that enhances India’s strategic autonomy. Nowhere else is this debate more apparent than whether and how to engage with the emerging “Indo-Pacific” construct. Is it an American ploy to rope in India as a junior ally in a containment strategy against China? Or is it also an Indian concept, giving Delhi the chance to step up and take the leadership in its own region?

Shivshankar Menon, India’s former national security adviser, reflects these concerns while cautioning that the Indo-Pacific should not be a “rigid security architecture” but instead based on building “habits of cooperation” with like-minded states, especially on economic and non-traditional security issues.⁷ Indicating India’s traditional reluctance about alliances and preoccupation to keep all doors open, Modi’s most recent vision of the Indo-Pacific accordingly emphasized the principle of “inclusiveness,” reassuring both his debating co-citizens at home as well as his counterparts in Beijing and across Asia, that India will keep pursuing a middle way. This posture is reflected in India’s relations with the United States, China, Russia, and other middle powers.

Decreasing trust in Trump

In relation to the United States, the key question hinges on the terms of what former Indian prime minister Atal B. Vajpayee once called a “natural alliance.”⁸ Beyond beautiful speeches about democracy as a shared value, only few have cared to explicitly call out China as the elephant in the room that made Indo-American convergence since the 2000s feel so “natural.” Today, almost twenty years later, however, the relationship is under stress and unlikely to be described as an alliance by any leaders.

This is mainly but not only because of Trump and his erratic utterances about India. As my Brookings colleague Tanvi Madan cautions, India and the United States will face bilateral crises and structural divergence unless they “get off their respective high horses and show a willingness to make concessions, find compromises, and strike deals across sectors.”⁹ This also serves as a lesson to those who complacently bank on China as the natural propeller of U.S.-India convergence: China is a factor “that can’t be ignored” but, as Madan notes, it “is not the only factor shaping the U.S.-Indian relationship” (emphasis added).¹⁰

Since the mid-2000s, India and the United States achieved revolutionary progress on the security track, with a series of nuclear, weapons transfers, and defense logistic deals that drove an unprecedented geostrategic alignment. Mostly focused on the maritime domain and the Indian Ocean region, this culminated in the US declaring India a “major defense partner” in 2016. However, contrasting with such security convergence, as Shivshankar Menon would note two years later, “it is actually the economic issues that are proving much more contentious and require greater attention than the politics and the strategic part of the bilateral relationship.”

Indeed, Trump, the trade warrior, has recently brought to the surface several latent differences that were simmering between both countries for long, from trade liberalization and market access to intellectual property rights and immigration policies. Not sparing Delhi, he has called India a protectionist “tariff king,” among other accusations and tirades.¹¹ So it was not surprising when, earlier this year, the United States removed India from the Generalized System of Preferences program. Trump’s subsequent comments about wishing to mediate between India and Pakistan, and his acerbic reference to India having to step up and fight ISIS in Afghanistan, have further aggravated the bilateral relationship.¹²

The long US-India honeymoon of the last fifteen years is now coming under stress. Two of the architects of this convergence, Ashley J. Tellis and Robert D. Blackwill, thus recognize that India now suffers from a “crisis of faith in Trump’s America as a security partner.”¹³ This is best reflected, they note, in Delhi’s increased investment in repairing relations with China and Russia, which had been relatively neglected in the recent past.

China between cooperation and conflict

The middle kingdom remains the most significant player in Modi’s attempts to craft an Indian middle way to fend off competing pressures. His objective is to reset relations after one of the most hostile periods in the bilateral relationship, marked by a tense military standoff in Bhutan, in 2017. India also opposed Beijing’s Belt and Road Initiative (BRI) right from the beginning. As American, European, and Japanese envoys joined the first BRI Forum, in Beijing in mid-2017, India took a firm stance—not only on legal grounds related to BRI projects in Pakistan-occupied Kashmir, but also on level-playing field concerns that would soon also become apparent to others.¹⁴

Two years later, the India-China “reset” has been one of the most significant outcomes of Trump’s aggressive and erratic posturing. Nobody in India is under the illusion that China is an ally, but most would probably concur that India’s diversification strategy now demands a tactical engagement, even if only to make the most of rising US-China tensions.¹⁵ In the assessment of Shyam Saran, who also served as ambassador to Beijing, “whenever there is a rise in US-China tensions, we have seen a lowering of tensions between India and China.”¹⁶

Modi may be aware that India is now stuck somewhere between two contrasting scenarios in the larger US-China-India triangle. The rosiest constellation sees India benefitting from a rising conflict between the United States and China, which puts Delhi in a sweet spot as an indispensable pivot for both Washington and Beijing. The darkest “G-2” scenario, on the other hand, is one where Trump and Xi agree to a temporary power settlement, and the United States concedes parts of Asia, as well as Indian core interest areas and issues, to an enlarged Chinese sphere of influence. While neither of these extreme scenarios is likely in the short run, they inform Indian assessments and shape its incentives to manage an increasingly complex relationship with China: 1) through a mode of cooperation based on rising economic interdependence, with China now being India’s major trade partner; 2) through a mode of coexistence, where both giants agree to work in parallel towards similar objectives, including on connectivity; 3) through an approach to China also marked by rising levels of competition, reflected in Delhi’s renewed engagement with its own neighborhood and its outreach to Southeast Asia under the Act East policy; and 4) finally, through an occasional dynamic of conflict, when Chinese and Indian interests clash as during the Doklam crisis in Bhutan.

Modi has come a long way since he was first elected to office, in 2014, and experimented with all four modes of interaction on China. His initial approach was marked by his business instincts, focused on the belief that he would be able to engage Beijing transactionally and through economic interdependence. This rather naive belief collapsed rather rapidly, as well as dramatically, in September 2014, barely a few months after taking office: just as Modi welcomed Xi with open arms for a summit in his home state, the Indian Army faced PLA incursions across the disputed border in the Himalayas.

This then slowly gave way to the hostile period of 2016-2017, where Modi tasted first blood and embraced the realist Indian maxim that you must play hardball to get China’s attention. Naturally, this conflict mode was not sustainable for either side, eventually leading to the 2018 Modi-Xi meeting at Wuhan, in China, and an agreement to lower temperatures. Since then, the focus has been, once again, on transactional relations, but Indian levels of trust remain atypically low. Xi’s visit to Varanasi for a return meeting with Modi, later this year, is thus unlikely to move the Indian needle from tactical engagement to strategic normalization.

The bad experience explains why Modi remains hesitant about China, and the debate in Delhi rages on. For Srinath Raghavan, India should have avoided the hostile posture of 2016-17 and must instead learn to play a game of “diplomatic patience” with China, nudging rather than confronting.¹⁷ For strategic analyst C. Raja Mohan, on the other hand, India should be under no illusion that China will understand any other language than that of crude, brute force. Dismissing the nostalgic ideas of Asian solidarity, he cautions, “Delhi can no longer make light of the implications of the emerging Sino-Russian alliance for India’s engagement with other powers.”¹⁸

To Russia with love

Every analysis of India-Russia relations must begin with due reference to the fact that Moscow remains Delhi’s principal defense supplier. Putin’s assertive anti-American policy has now added to Russia’s relative importance on India’s strategic radar. Besides the permanent utility of its veto at the United Nations Security Council, Russia is seen as a pivot power between the West (read the United States and NATO) and the East (read China). At the same time, Russia’s proximity to China and its openings to Pakistan have forced India to no longer take Putin for granted and put in the effort to sustain a more transactional relationship.¹⁹

Even those in Delhi who argue that India remains too emotionally attached to the Russia of yesteryears recognize that Putin has been able to slow down his country’s structural decline and it continues to punch above its weight.²⁰ Most Indian decision-makers would probably concur that the United States and Europe are wasting precious time confronting Russia when everyone’s eyes should, instead, be on the main ball—China. Even if only for the Russian “spoiler power,” India has thus been forced to give some love to Moscow, often landing it in trouble with the United States and European powers. This was, most recently, the case with India’s insistence to purchase Russia’s S-400 air defense system despite the US threat of sanctions. But India’s incentives to “hang on” to Russia also reflect how many in Delhi see the health of the Delhi-Moscow partnership as an indicator of India’s overall strategic autonomy. For former diplomat P. S. Raghavan, who served as Indian ambassador to Moscow, “India should not have to choose between one strategic partnership and another (…) The India-Russia dialogue should not get inextricably entangled in the India-US dialogue.”²¹

Bottom line, Modi’s middle way diplomacy is seeking to re-engage Russia to slow down Moscow’s convergence with Beijing and, at the same time, fend off American and European pressures. This fine balance has translated into a succession of Modi-Putin summits, as well as multilateral initiatives such as the RIC meeting at the G20 and engagement via BRICS and the Shanghai Cooperation Organization (SCO). However, rather than a revival of Yevgeni Primakov’s famed Asian strategic triangle of the 1990s, as some Americans or Japanese sometimes fear, this remains a rather traditional Indian marriage of convenience, forced by circumstances and all but passionate.

The power of many: Japan and the middle powers

As the first among these equal middle powers, India has taken on a special responsibility to collectively craft a third way that mitigates exposure to rising Sino-American tensions. Modi’s balancing thus hinges on a new “middle power” diplomacy by engaging Japan and other regional actors to create an alternative architecture that facilitates coordination and cooperation.²²

Japan is the key unit in this “plan b” to reduce reliance on either the United States or China. Free from any irritants, no other Indian bilateral relationship today is as strong as the one personified by the Modi-Abe link. Delhi’s strategic flavor of the day, the land of the rising sun keeps delivering on many fronts since Abe set out his grand vision of the Indo-Pacific, back in 2007, before the Indian parliament.²³ From that definition of the “confluence of the two seas” we now have moved on to a robust Indo-Japanese partnership towards a “Free and Open Indo-Pacific” (FOIP).²⁴

Modi and Abe’s long meetings at the G20 in Osaka illustrate the depth and scope of the relationship, on which many smaller Asian states now rest hopes when they speak about the need for an alternative to China. As with the US-India relationship, China plays an important but not predominant role in the convergence between Delhi and Tokyo. Cognizant of their respective economic interdependencies with China, both India and Japan realize that the FOIP cannot succeed as a classic security alliance, nor as a containment strategy.

Instead, the India-Japan middle power partnership seeks to raise the costs for Chinese unilateral action and, at the same time, lower the costs of collective action among like-minded Asian partners concerned about rising China’s hegemonic preponderance. Hopes used to be higher about China’s responsiveness to institutional incentives, but Modi’s emphasis on “inclusiveness” shows that the door remains open. Besides this cardinal incentive to shape the changing Asian order, the Indo-Japanese relationship is also facilitated by a normative alignment of shared democratic values and a joint commitment to a variety of other values, from transparent infrastructure financing to the rule of law, whether on international freedom of navigation or domestic privacy concerns for its citizens. No other Indian relationship today is so broad: Japan plays a critical role in infrastructure modernization, there is a functioning free trade agreement, and both bureaucracies have overcome myriad obstacles to cooperate on infrastructure and capacity-building in third countries, most recently in Sri Lanka.²⁵

The Indian and Japanese navies are now also exercising towards creating a new constabulary force by also flexibly bringing in Australia and other counterparts, when possible. From infrastructure to capacity-building and maritime security, India and Japan are slowly fleshing out the most serious alternative to China’s BRI across the Indo-Pacific, whether through the Asian Development Bank, the Asia-Africa Growth Corridor (AAGC), or the annual JIMEX naval exercises.

Simultaneously, Modi’s middle power diplomacy has tried to replicate this dynamic with a variety of other regional peers. India has come out strong in support of ASEAN centrality in its Indo-Pacific vision, reserving a special place for Singapore. After years of neglect, India has also adopted an aggressive Europe engagement policy, restarting summits with the European Union and crafting an “alliance” with France, including a defense logistics agreement. Towards the West, Modi has privileged Israel as a technological partner even as he deepens relations with the Gulf economies and manages to sustain a fine balance with Saudi Arabia and the United Arab Emirates. The best illustration (and result) of Modi’s middle power diplomacy is found in India’s new trilateral maritime security dialogue with France and Australia. Focused on the Indian Ocean region, this consultative mechanism reflects Delhi’s investment in crafting a middle way that hinges on a flexible architecture of regional powers that refuse to wait for Washington or Beijing to get along because, as history often reminds us, hope is not a policy.

Doing “the needful” at home

Modi’s external balancing game is either shrewd and ambitious or naive and dangerous, depending on whom in Delhi you speak to. The debate will rage on, for example on the ideal degree of proximity to the United States. But to a large extent, this is a philosophical debate, as so many other Indian geostrategic discussions of the past: was India’s 1971 security treaty with the Soviet Union, an alliance or a non-aligned partnership? Bottom line, India’s maneuvering ground for external balancing hinges mostly on its economic and military capabilities and, to that extent, on Modi’s political willingness to pursue critical reforms at home. In a recent interview, Shivshankar Menon thus strikes a cautious note: “it might be very good for our ego to hear that India is rising and [that it] needs to play a bigger role. It’s flattering but it’s irrelevant to our real needs…. the temptations are always there [abroad], but we have to keep our eye on what’s important—transforming India.”²⁶

In strictly political terms, Modi is in an enviable position compared to many of his democratic peers worldwide. His party is in almost total control of both houses of parliament and most Indian regional state assemblies. His leadership is uncontested and his party’s re-election campaign succeeded mostly due to his personal charisma, despite mounting economic concerns. In the first two months of his second mandate, such political power has even allowed his government to implement bold decisions with international ramifications such as the withdrawal of Jammu and Kashmir’s statehood.

On the governance front, however, many feel disappointed. In their analysis of Modi’s first mandate (2014-2019), Rahul Sagar and Abhijnan Rej argue that despite his revisionist ambition, Modi “failed to significantly enhance India’s capabilities in terms of increasing the country’s latent power by advancing substantive economic reforms or channeling that power toward bolstering India’s defense capabilities.”²⁷ Others point to incremental changes as examples of success, but among analysts the confidence seems to be evaporating quickly. 
In any case, India’s external balancing game will rely on Modi’s ability to address three urgent reformist requirements at home. In the parlance of Indian English, this requires him to “do the needful,” however costly in terms of political capital, to liberalize the economy, reform the military, and expand bureaucratic capacity.

Protecting the economy from the business of strategy

Successive Indian diplomats have defined the best Indian foreign policy as one that keeps India’s economy growing at 7-10 per cent. A 2012 report on the strategic future of the country, with contributions from several former decision-makers, observed that “if India can maintain high growth rates, leverage that growth to enhance the capabilities of all its citizens, and maintain robust democratic traditions and institutions, there are few limits to India’s global role and influence.”²⁸ In 2014, Modi’s prior economic governance record in his home state of Gujarat, and his campaign promises to modernize the economy were widely interpreted as a harbinger of reforms and, most importantly, openness. Such high expectations were soon replaced by a sense of disappointment among some observers.²⁹ The economy has been doing well overall, growing at 6-8 per cent rates, but on reforms the picture is, at best, mixed. A detailed analysis by Richard Rossow, from the Centre for Strategic and International Studies, showed that towards the end of 2018, Modi’s government had achieved less than a third of the thirty critical reforms to modernize the economy.³⁰

There are now worrisome signs of the economy tanking for good.³¹ The ambitious target of a five-trillion-dollar economy by 2024 seems farther than ever, just three months into Modi 2.0. Left to his political instincts and advisers, Modi has put increasing emphasis on both populist and protectionist measures. This included a largely ineffectual shock demonetization, withdrawing most high-value currency bills from circulation in late 2018, and a progressive hike in import tariffs during 2019. Decision-making processes have also exposed institutional frailties that further affected investor’s confidence. 2018 and 2019 were rocked by a succession of political moves that reportedly impinged on the central bank’s independence and also a governmental embargo on the release of critical employment statistics before the elections. At best, Modi’s supporters will argue that his political activism reflects a much-needed leadership and can-do approach that is forcing traditional institutions out of stagnation. At worst, on the other extreme, critics will see his moves as reflecting a mix of anti-intellectualism and aversion to evidence and dissent in economic policy debates.

For an economy that may be tanking and which requires millions of new jobs to be created every month over the next few years, all these developments do not augur well. Economically speaking, India continues to punch well below its weight in the changing Asian order: the asymmetry with China, in particular, keeps growing. More protectionism and insulation, whether on trade or data, is unlikely to be the right solution. However, there seems to be hardly any appetite for economic openness.

Having stayed away from the failed Trans-Pacific Partnership under Obama, India today remains a reluctant actor in the China-driven negotiations for the Regional Comprehensive Economic Partnership (RCEP). Even worse, it has begun to review some of its existing free trade arrangements.³² In the meantime, the “Make in India” manufacturing revolution promised by Modi five years ago has stalled, and foreign direct investment has been falling steadily.

It is thus no coincidence that when India plays its balancing game abroad, it tends to focus disproportionally on security and defense cooperation, whether it is counter-terrorism or joint military exercises. At least from India’s perspective, the FOIP strategy, therefore, has no meaningful economic dimension. And trade and investments hardly find a mention when Indian, American, Japanese, and Australian officials meet for their Quadrilateral talks, leading American analyst Alyssa Ayres to speak about the dangers of its “over-militarization.”³³ India’s security-centric foreign policy seeking to compensate for economic protectionism at home is simply unsustainable. It may also be counter-productive by inviting China’s wrath and raising alarm bells in other Asian capitals, which are already under Beijing’s scanner for allegedly bandwagoning with the Indo-American “alliance” to “contain” the middle kingdom.

Modi has been so far unwilling to recognize that India’s geostrategic interests rely on its economic openness and regional interdependence. In fact, he is trying to reverse the Chinese success story of the last forty years, assuming that India can achieve its security interests first, before integrating economically with privileged partners like the United States, the European Union, or Southeast Asia.

Dilly-dallying on defense and diplomacy

Modi’s domestic economic problem is aggravated by two additional reformist challenges at home. First, in terms of defense policies, India’s military modernization plans have stalled, exposing critical capability and doctrinal gaps. Faced with two neighboring and sometimes hostile nuclear powers, a variety of domestic insurgencies and cross-border terror threats, and a rapidly changing security context marked by new technologies and artificial intelligence, Delhi has been surprisingly complacent.

As noted by Abhijnan Rej, at 1.6 percent, the defense budget as share of Indian GDP is now the lowest of the last twenty years, with decreasing investments in critical acquisitions and a bloated army enlisting 1.3 million people.³⁴ Modi has struck the right chords in terms of doctrinal and institutional discussions, including the announcement of new apex decision-making bodies and a new chief of defense staff, but implementation has been slow at best. Most recommendations from a 2001 high-level committee on defense and security reforms remain on paper.³⁵ The promises of defense indigenization are still contradicted by an extraordinary reliance on foreign military purchases.³⁶

India’s ambition abroad is also hobbled by a growing gap between Modi’s extraordinary diplomatic ambition and India’s small, over-stressed bureaucratic cadre, and institutional coordination deficiencies. In his first term, the prime minister travelled to almost hundred countries, an extraordinary and possibly also unprecedented amount of time dedicated by an Indian prime minister to external affairs.

Modi’s pursuit of the middle way abroad reflects his commitment to enhance his country’s international reputation and has, to a wide extent, achieved impressive results. Just in India’s traditional sphere of influence, for example, in 2015 he became the first prime minister to pay a state visit to neighboring Sri Lanka since the late 1970s. This political outreach revived many other bilateral relationships that remained stagnant for decades. At the same time, however, India’s bureaucratic body was not always able to cope with the hyperactivism of Modi’s mind. The gap between India’s external commitments and its capacity to follow up and implement them thus widened over the last years. Never was this more apparent than in 2016, when the prime minister identified a regional organization in the Bay of Bengal (BIMSTEC) as a top regional priority even while it took two years to appoint the Indian representative to its headquarters, in neighboring Bangladesh.

With little more than nine hundred officials, the Indian Foreign Service, in particular, has been overstretched to represent the increasingly complex interests of 1.3 billion Indians. Coordination problems with several other line ministries and also regional states, whether on defense or trade issues, are frequently responsible for further delays in fulfilling international commitments. This has naturally led to a mix of frustration and disappointment among many small and middle powers that were initially keen to finally get on Delhi’s geostrategic radar.

Conclusion: Many paths towards the middle way

Modi’s ability to reach the geostrategic middle way will rest on his government’s willingness to craft external balances while not losing sight of domestic capacity gaps. In the age of interdependence and rapid technological change, India is unlikely to sustain its rise on the cheap by relying on the financial capital or strategic interests of others.

Abroad, the China challenge will continue to loom large. As emphasized by Shivshankar Menon, the propensity for conflict between the two Asian giants “depends on whether we can work out a new way of dealing with each other.”³⁷ While a Sino-Indian “modus vivendi” through coexistence remains a possibility, Modi’s foreign policy suggests that the probability is unlikely. Instead, the fine balance reflected in his G20 balancing act between the JAI (Japan-America-India) and RIC (Russia-India-China) trilaterals, indicates that he will try to keep all options open through strategic diversification with several middle powers.

Even if it performs the most sophisticated balancing act abroad, India’s interests will boil down to chimeras unless Modi is able to implement a reformist agenda at home by opening the economy, modernizing the military, and empowering the bureaucracy. In the words of one observer, China’s BRI has dramatically changed India’s “operating environment,” and it will continue to do so by financing infrastructure in India’s backyard, using Pakistan as its security proxy to tie India down, or luring Indian companies to advocate for its 5G network.³⁸

For South Korea, Thailand, and other traditional treaty allies of the United States, the rapid rise of a more assertive China and Trump’s relatively quick Asian disengagement policies may have come as a bad surprise. Forced into a strategic shock therapy after decades of American dependence, their consequent uncertainty is perhaps most appropriately manifested in Japan’s military “normalization.” But for a seasoned practitioner of non-alignment like India, used to crafting difficult balances in constantly changing orders, the current fluidity may bring some concern but does not pose a dramatic challenge.

Modi’s G20 balancing act between JAI and RIC at Osaka shows that, as with his predecessors, he refuses to make tough choices and tilt India either into the Indo-Pacific or Eurasian camp. Time will tell whether refusing to see the geostrategic fork in the road is wise or if Modi’s middle way is bound to collapse under a dramatically changing world order, where being friends with everybody is also being friends with nobody.