PremiumIndia under Prime Minister Narendra Modi has been listed as the fifth biggest geo-political risk of 2020, by the political risk consultancy – the Eurasia Group – in a list that is topped by elections in the US and followed by events and developments like the US-China technology tug of war on 5G as well as the trade war between Beijing and Washington.
According to Ian Bremmer (Eurasia Group president) and Cliff Kupchan (Eurasia Group chairman), Modi has spent much of his second term--since winning the April-May poll--promoting controversial social policies at the expense of an economic agenda.
“The impacts will be felt in 2020, with intensified communal and sectarian instability, as well as foreign policy and economic setbacks," the two said in their assessment report released on Monday.
The recent changes brought in by Modi in his second term include the revocation of the special status for Jammu and Kashmir through an Act that was passed by Parliament. There was also the start of the process to identify illegal immigrants in Assam, which has left 1.9 million people out of a National Registry of Citizens. “The government also passed a law that, for the first time, makes religion a criterion for migrants from neighboring countries to formally acquire Indian citizenship," Bremmer and Kupchan said – referring to a law passed by India’s Parliament in December which the government says provides fastracking of citizenship to minorities like Buddhists, Christians, Sikhs, Jains and Parsis from Afghanistan, Bangladesh and Pakistan.
“Behind these moves is Amit Shah, the former head of Modi's Bharatiya Janata Party (BJP), now home minister," the assessment authored by the two said.
“Sectarian and religious conflict will grow accordingly. Kashmir is a powder keg, with political leaders still under arrest and internet access cut off. Protests have already spread around India as many citizens fear the loss of India's secular identity. The government's harsh response, in turn, will provoke still more demonstrations. But Modi will not back down, and as the government pursues its new agenda, state-level opposition leaders will directly challenge the central government," the report warned. In August, the government revoked a temporary provision in its Constitution and removed the special status bestowed on Kashmir. It also bifurcated Kashmir into two union territories. Ahead of the moves, the government placed Kashmiri politicians in preventive detention and cut communications like internet and mobile phone service. Some of the communication services have now been gradually restored.
“This focus on the social agenda will also have harmful effects for India's foreign policy. Its actions on human rights will be under closer scrutiny by many nations, and its reputation will take a hit. India's relations with the US, which have been a bright spot under Modi, will face a challenge in 2020. Some members of the US Congress are concerned with India's policies generally, and in particular with its plans to buy the S-400 missile defence system from Russia. Congress could impose sanctions. At the least, the anti-missile system purchase will impede further sales of US military equipment to India, the strongest plank of the bilateral relationship," the report said.
“The economic spillover is also noteworthy. The social agenda has empowered a key part of Modi's base, the Rashtriya Swayamsevak Sangh (RSS)—Hindu nationalists who oppose market opening and support economic nationalism," it said of the BJP’s ideological parent.
“An empowered RSS means that Modi has less room to maneuver on structural reforms, just as the economy is starting to sputter, with quarterly growth falling to a six-year low of 4.5% and forward-looking indicators looking softer still. The RSS influence was evident in Modi's decision to drop out of the Regional Comprehensive Economic Partnership negotiations last year and will be a big reason why India is unlikely to rejoin in 2020," it warned.
“India's fiscal situation is also precarious, as the government faces a widening fiscal deficit, marked by the underperformance of the goods and services tax. A weakened economy will in turn feed further economic nationalism and protectionism, weighing on India's troubled course in 2020," it said.
