The disintegration of the Soviet Union and the collapse of its communist ideology led to optimistic pronouncements of a new world order, one with less conflict and greater global integration and harmony. The US was left as the sole global superpower, and many saw it as leading the way in spreading democracy throughout the world. Conflicts on the periphery of the old Soviet empire, including the Balkans and the Caucasus region, have provided continuing challenges, but as we know, it is West Asia that has so far proved the optimists wrong.

Resources and religion inevitably make West Asia a locus of global friction. Imperialist machinations carved up the region before the Cold War, and created some of the current problems. Cold War proxy battles contributed heavily to the current situations with respect to Iran (which had implications for what transpired with Iraq) and Afghanistan (at the fault lines of West Asia, Central Asia and South Asia). Afghanistan and West Asia’s problems have spilled over into Pakistan, and as a result, India faces its own severe challenge. The latest terror attack in Mumbai is worrisome in its sophistication and scope, as well as in its apparent motivation.

The attack, in addition to seeking to create fear and inflict mayhem among the populace, targeted symbols and persons connected with Westernization, global capital and Judaism. In the last of these targets, West Asia’s territorial conflict, which has also become one of religion, is evident as motivation. However, there is a more general angst at work. The turmoil of globalization transcends religion and is probably responsible for much of the anger and frustration that comes from those who see themselves as losers from the process. Latin America has struggled with this perspective for a long time. And the rolling, expanding global financial crisis has swelled the ranks of those who see the US and global capitalism as the root of the problems of their world. Even many in the US are disillusioned with the system, and in their presidential election swept a symbol of change into the most powerful position in the world.

It is unfortunate that a mixture of hubris and incompetence has undermined the US’ moral and political authority in the post-Cold War world, for democracy and capitalism, exemplified in the US, did win the Cold War. The collapse of the Soviet Union helped set India, already democratic, on a path of higher growth and eventual prosperity by its greater acceptance of capitalism. But political and economic turmoil is challenging this growth path. How is India to navigate this disorderly world, both politically and economically?

The latest terror attack, following on a string of previous atrocities, points to a significant failure of internal security. It is difficult to be perfectly in control without an authoritarian apparatus, but Indian laws and practice provide significantly more leeway to security agencies than those of, say, the US. Governance in India is generally of poor quality, but there is no excuse for the failures that allowed the Mumbai attack to occur. India literally has to first get its own house in order, without losing its democratic essence.

Second, it must be recognized that use of force or pressure against another nation state will not solve the security problem. In particular, Pakistan’s government is itself under siege and unable to control radical elements within its borders. Even its north-western borders are not secure. Pakistan’s economy, after a reasonably good run, has crumbled under the latest crisis, and this economic collapse will only add to its political woes. There is no easy answer, unfortunately, and Barack Obama’s advocacy of keeping lines of communication open may be all one can usefully do on the diplomatic front. Making the attacks an excuse for religious nationalism will do no good.

However, there has to be closer cooperation with likeminded nations, including the US, in intelligence gathering and security operations. This is my third point: India has to become a serious world player at several levels, including combating terror, but extending far beyond that to global issues of trade, financial regulation and sustainability. This will require a strategic approach to Indian positions on these issues that has often been lacking.

As the world’s largest democracy, India has the potential to match Obama’s America in global affairs. China is way ahead of India in its strategic positioning in world affairs.

Finally, India has to keep growing rapidly. This means more economic reform. It means having enough internal security to keep finance, trade and tourism humming as growth engines. Ultimately, it means a step-up in the quality of governance, and that will require some agreement on how to proceed to achieve that. Civil service reform, as well as reforms of political institutions such as campaign financing, must be kept on the policy agenda.

The 19th century’s period of rapid growth and globalization ended in massive conflicts and devastation. We have to avoid going down that path at all costs.

Nirvikar Singh is professor of economics at the University of California, Santa Cruz. Your comments are welcome at