Topic 1 : The NB8 visit to India focuses on cooperation and trust
Context
In this year’s Raisina Dialogue in New Delhi, the eight Nordic-Baltic countries, are participating in it together as representatives of the Nordic-Baltic cooperation, the NB8.
About
At times of turmoil and conflict, the world needs more trust, dialogue and cooperation. The aim is to protect and defend peace and stability, to oppose aggression, to maintain a rules-based world order, and to strengthen a world economy based on free trade, sustainability and long-term partnerships.
NB8 countries and India
- It comprises governments of eight countries of the north: Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden.
- They are linked geographically, and we share deep historical, social, economic and cultural ties.
- Their advanced economies are outward-looking, innovation-driven, complementary and fully integrated into the world’s largest single market area, the European Common Market.
- Taken together, the size of the Nordic-Baltic economies would qualify not only for the G-20 but also the G-10.
- The countries share a commitment to democracy and human rights and are all champions of an international order based on multilateralism and international law.
- They also have long-term and ever-closer ties with India and the Indo-Pacific region in common.
Diverse links with India
- The Nordic-Baltic cooperation with India spans fields as diverse as innovation, green transition, maritime, health, intellectual property rights, new technologies, space cooperation and artificial intelligence, student exchanges, culture and tourism.
- Trade and investment figures between our region and India are steadily increasing.
- Jointly, India and the Nordic-Baltic countries are coming together in pursuit of common goals.
- In a time of geopolitical shifts, the security of the Nordic-Baltic region and the Indo-Pacific is interlinked.
- Today, it is more essential than ever to work together to uphold international law, and to build capacity to tackle both traditional and non-traditional security threats, be it in India’s neighbourhood or in our own.
- The group recognise India’s increasingly important role in international politics.
- India has taken on important global responsibilities. Indian leadership, as illustrated not least through the successfully concluded G-20 presidency, is increasingly important for global security and prosperity.
- In recent years, the world has all experienced global health, climate-related and geopolitical shocks that have caused significant strain to our peoples, the international system and indeed on this common planet.
Peace formula
- Two years on, it is clear that Russia has totally underestimated Ukraine as well as the support and determination of the international community.
- The peace formula, which has received broad international support, includes issues of global concern such as energy and food security, environmental consequences and justice.
Conclusion
The message to the world continues to be partnership, trust and cooperation. A partnership for development and health; a partnership for green transition and digitalisation; and a partnership for peace and stability.
Topic 2 : Changing the growth paradigm
Context
India’s policymakers must free themselves from western-dominated theories of economics; in this, local solutions are the way to solve global systemic problems.
State of Indian economy
- India’s economy is not healthy, the Governor of the Reserve Bank of India has said in an open letter to the Union Finance Minister, Nirmala Sitharaman.
- More GDP does not improve the well-being of citizens if it does not put more income in their pockets.
- They need decent jobs, which the Indian economy has not provided despite impressive growth of GDP.
- The health of any complex system, whether the human body or a nation’s economy, cannot be determined by its size. What matters is the shape it is in.
- GDP growth has become the dominant measure of the health of all economies.
- India is becoming one of the most unequal countries in the world with this flawed model of economic progress.
- All Indian governments, since the liberalisation of the economy in 1991, have focused on GDP.
- GDP grew at 7.2% per year in the 10 years of United Progressive Alliance rule (excluding 2008-09, when the global financial crisis hit); and also at 7.2% in the National Democratic Alliance’s 10 years (excluding the 2020-21 global COVID-19 pandemic shock).
- There was no difference in growth. But, structural conditions that cause inequitable growth have also not changed. In fact, they have worsened.
Inclusive and sustainable development
- All economies in the world develop through similar stages, according to economists.
- First, populations move from agriculture to industry, and then to services.
- Simultaneously, they move from rural to urban. In this, “one path for all”, model of progress, villages are bad, and cities are good; and farms are bad, and factories are good.
- According to this theory of progress, India has not developed sufficiently because both industrialisation and urbanisation have been too slow.
- India must address the global climate crisis while growing its own economy to catch-up with developed countries.
- With the present model of progress, India must use more fossil fuels to propel economic growth.
- This has become a bone of contention in global climate negotiations, where all countries are expected to make equal sacrifices to save the global climate. Therefore, India must find a new paradigm of progress, for itself and for the world, for more inclusive and environmentally sustainable growth.
Fossil fuels and the modern economy
- They are used in the production and the distribution of four foundational materials for modern civilization: steel, concrete, plastics, and food.
- Steel and concrete are required for buildings, roads, and bridges, which provide the basic needs of habitation and transport. Steel is also the backbone of most machinery.
- Moreover, almost all mobile machinery used for transportation and farming runs on fossil fuels.
- Plastics in many compositions have become ubiquitous in the construction of machines, buildings, and appliances. They are light, easy to mould, and are durable.
- Plastics also enable hygienic storage and transportation of foods and are widely used for sanitary protection in hospitals and homes.
- Plastics are formed from fossil raw materials, and fossil fuels are also required in the production processes of plastics.
- Food is the most fundamental need for human survival: more fundamental than steel, concrete, and plastics. And more fundamental than digital communication services,
- Fossil fuel-based solutions have become integral for increasing the scale of food production and distribution systems in the last century, to meet the needs of the human population on the planet, which has increased in the last 100 years from two billion to eight billion (1.4 billion in India).
- Fertilizers are produced from fossil-fuel feedstock. Farm machinery is made of steel and runs on fossil fuels. Plastics are used for hygienic transportation of food in global supply chains.
Local solutions work
- Systems science reveals that local systems solutions, cooperatively developed by communities in their own villages and towns, are the way to solve global systemic problems of climate change and inequitable economic growth.
- This was the “Gandhian” solution for India’s economic and social progress, which was set aside to adopt modern, western solutions for development since the 1950s.
- Sixty-four per cent of Indian citizens live in rural areas (36% in China; 17% in the United States).
- A majority work on farms, and in small industries in rural India — not in large factories that use automated equipment.
- Rather than trying to catch up with rich countries on their historical development paths, India should take advantage of its present realities.
Conclusion
India’s policymakers must free themselves from western-dominated theories of economics. These are the cause of global problems, not their solution. The time has come to go back to old solutions to go to the future. Rural Bharat can be a university for the world, producing innovations in institutions and policies for inclusive and sustainable growth.