India and the China Challenge in Leading the Global South

By – Ratish Mehta;

India’s recently concluded Voice of Global South summit as part of its G20 presidency involving more than 120 nations has brought about some much-needed attention to New Delhi’s role as a facilitator in bridging the gap between the Global South and the rest of the world. In the continued discourse of conducting itself as the leader of the South, India is not only claiming its position as a reformist nation but is also asserting itself as an alternative to the prevailing dominance of China in the same domain. New Delhi’s unique position in the global order due to its growing engagements with the Global North also presents it with the opportunity to put forth the concerns of the Global South in a manner that brings substantial changes in the existing order. However, in its endeavour of championing the agendas of the developing world, India’s approach is bound to face some challenging contradictions. By advocating for an equitable global forum that integrates the South, New Delhi will have to find the right balance in its leadership endeavour by seeking reforms within the existing mechanism as opposed to China’s leadership which is steadily promoting its own alternative model for global governance. An emerging question in such a projection then lies in outlining the fundamentals that differentiate both India’s and China’s leadership approaches in the developing world as well as understanding how India’s leadership could gain momentum against China’s revisionist tendencies that are taking shape in the Global South.

What is the Global South?

The idea of the Global South found prominence in the post-world war order that left an international system divided between the decolonising South including countries from Asia, Africa, South America and the industrialized North, led by the G7 powers including the United States (US), United Kingdom (U.K.), France, Canada among other western countries. The unequal distribution of economic power, post the decolonisation process in the 1940s had resulted in multilateral institutions being dominated by the developed world while unfavourable policies against the developing countries reinforced the pre-existing power imbalances. The economic disparity among countries as a consequence played a significant part in paving the way for the discourse on the Global divide. The first large-scale meeting of the Global South held in 1955 during the Bandung Conference between newly independent Asian and African countries was also a pivotal meeting in advancing the objectives of the South-South Cooperation.  India in specific played an important role in constructing the bridge among decolonized countries from the South by initiating the Non-Alignment Movement (NAM) in the early 1960s along with Egypt, Indonesia, Ghana, Yugoslavia and some others who more generally gained their liberation from western powers. On the other hand, China’s clearer focus towards the Global South was advocated in 1974 when Mao Zedong articulated the “three-world strategy”, stating that all of Africa, Latin America along with Asia (except Japan) composed the developing world.

A secondary but no less important motivator for the cooperation within the Global South had been the historical exclusion of emerging economies from multilateral institutions such as the United Nations (UN), along with the Multilateral Development Banks (MDBs) such as International Monetary Fund (IMF) and the World Bank. These international institutions since their inception post the Washington Consensus have inculcated the dominance of the Global North instead of an equitable forum mostly due to its colonial history over the South.

India and China which are more often considered the two fastest developing countries from within the Global South have in their respective capacities indicated that the prevailing world order has generated unfavourable policies against the developing economies. From seeking a greater say in multilateral institutions to accommodative trade practices in multilateral trading systems, Beijing and New Delhi have on various occasions voiced their discontent with the mechanisms that currently function in global governance. However, their convergence in fundamentally agreeing on the existing power imbalance between the North and South also brings to light the divergence in their paths of mitigating such global inequalities.

Varying Approaches to Leading the Global South

The differentiation of approach between the two in the developing world can be outlined through the norms and principles they project in their efforts to dispel the global divide. For instance, both countries advocate for a greater share of the developing world in the UN; both seek to alter the status quo prevailing in many of the multilateral institutions too, albeit, leaning with their own normative stands.

In China’s approach to leading the developing world, it has exerted significant agency towards altering the prevailing order far greater than any other of its contemporaries and has prioritised providing alternatives to the global financial institutions, while India in its own method has attempted to reform the existing order without confronting dominant forces in the global arena. However, given their shared history of exploitation by the West, both have also converged on various issues, or at least in the objective their respective initiatives have undertaken. A similar stand was illustrated in China’s official response to India’s Voice of the Global South initiative where it endorsed the objectives of the conference and called for greater global attention to the developing world’s aspirations. The same opportunity was also utilised to promote its own platform devised for the Global South- The Global Development Initiative (GDI). The GDI’s aim of setting in motion the UN 2030 Agenda for Sustainable Development as well as elevating the developing world in domains that have mostly been neglected by multilateral institutions, either due to inadequate funding or more generally due to opposition from host countries in re-evaluating local laws, is more or less similar to India’s agendas for the Global South — which is to develop and lead the transformation. Yet, their divergence as stated above is particularly in the ideals and norms that uphold their initiatives.

For China, the mechanisms of a neoliberal global economy along with political/democratic liberalization does not find prominence in their discourse and actions for change in the world order. China’s philosophy of development has evolved significantly away from the Western-led model— the Belt and Road Initiative (BRI) among other endeavours in a specific way, is Beijing’s assertion that an alternative developmental method exists especially beyond the one implemented by west-dominated multilateral global institutions. The projected BRI model does not seek to interfere with domestic laws for the purpose of providing finances and credit lines that until recently were concentrated within traditional multilateral institutions of the Breton Woods system. Its critique of the western model is directed towards the structural conditionalities the Global North has attached historically in lieu of financial and developmental aid. Until the previous decade, global financial institutions had monopolized the disbursement of developmental funding to the Global South. Concerns against MDB’s conditionality in recipient countries influenced the space for an alternative financial mechanism that granted developmental funds without having to make long-term policy adjustments such as deregulation in specific sectors and privatisation policies. Beijing’s discontent with such a condition influenced the establishment of the Asian Infrastructural Investment Bank (AIIB) that functions with an operational method which is meant to disrupt the existing developmental financing mechanism. This endeavour not only provided it with a gateway into the Global South but has also enabled it to export its developmental models overseas. Although, Beijing has rhetorically projected its inclinations towards the ideals that uphold the rules-based order, its actions in altering the global financial system have more generally indicated otherwise.

Thus, China’s alternative is to propose and deliver a different developmental method altogether through its initiatives which not only advance its global footprint but also gains it influence in the developing world. Its normative stand, which is revolutionary in nature, is set under the construct of revising the existing system.

A fundamental differentiation in India’s position, as opposed to China’s, lies in the fact that New Delhi acknowledges the value systems and norms that uphold the rules-based world order while simultaneously differing in the implementational mechanisms that drive these institutional settings. It seeks to reform rather than revise the existing model with a consensus-driven approach which is also much in line with its internal democratic model as against China’s alternative methods.

For India’s agenda, integration of the Global South evolves out of principles based on unbiased rules, accountability and most importantly through a democratic process that enables an equitable voice in matters that impact the whole of the Global South. For instance, India’s position in not joining the price cap against Russian crude oil was based on the implications of doing so on the Global South along with its own domestic population. The G-7 and Australia’s unilateral decision (which comprises most of the Global North) to pose an embargo was particularly going to cost the developing world that were already dealing with the effects of the pandemic. The fact that the impact of the embargo on the developing countries was not even considered initially was also quite telling of how significantly the global divide exists even today.  

Yet, at the same time, India unlike China also finds itself much closer to the Global North in terms of bilateral engagements. This relationship between India and the West has importantly gained greater significance since China’s alternatives (such as the BRI) began taking shape. Its decision to join the Quadrilateral Security Dialogue (QUAD) along with three of the most developed countries (U.S., Japan and Australia) among other initiatives is a direct result of China’s growing influence in the region as well as internationally. These engagements also expand its ambit of opportunities where it can, through its unique position, call for reforms that can actually bring a meaningful change in the developing world’s global status by way of concessions that have long been awaited from the West.

Opportunity as Opposed to Challenge

Beijing’s growing influential approach is moreover not as much a challenge for India and the North as much as it is an opportunity for them to set the existing house in order. India, at present with its presidency of the G20 finds itself in the best position to seek the required reforms that it has been seeking for decades. Among these voices of reforming the multilateral institutional mechanism, is the call from India to reassess the functionality of lending to the developing world. Excessive debt burden sustained by the Global South due to unpaid debt during the pandemic has caused growth rates of the Global South to falter significantly.

New Delhi, which stands at the crossroads of the developing South and developed North is in the right position to utilise China’s advances to illustrate the strategic threat it poses not only for the north but also for regional powers that are concerned by China’s influence and thus seek the required reforms in the same domain. From debt restructuring for developing economies to financial lending by MDBs, reforms that integrate the developing world’s concerns need to be stressed and acted upon to showcase that India’s leadership actually inculcates substance.

Its leadership for the Global South should therefore begin from negotiating for debt restructuring under the G20’s Common Framework in order to aid countries in revising their debt repayment mechanism to bilateral creditors including to China which has become amongst the largest lender to the developing world. Apart from inviting countries from the Global South by providing them with a platform to seek debt restructuring, India’s presidency should also actively work towards enhancing the critical functions of the Common Framework such as convincing private lenders to join the process and delaying debt repayments for economically volatile countries. This is not only vital for countries that have induced a hefty debt burden over the past couple of years but is also an insight into how much the developing world has shifted to Chinese finances as an alternative to the existing unequal financial system.

These efforts would also aid in projecting New Delhi’s global vision as a leading power where integration into the existing order is possible through reforms for the Global South, unlike for China, where the developing world is an avenue for it to exhibit its alternatives that can possibly revise global governance.

India’s G20 presidency is therefore, more importantly an opportunity for New Delhi to project its role as a reformist power as well as put forth the Global South’s concerns in order to enhance the developing world’s global position. Its calls for pursuing a reform and action-oriented agenda as well as voicing the Global South is a step in the right direction which would also require concrete actions to be initiated in order to propose a better leadership role than that inculcated by Beijing at present.

Ratish Mehta is a post-graduate in Global Studies from Ambedkar University and holds a Bachelor’s degree in Political Science Hons from Delhi University. His research interests include understanding the role of narratives in geopolitical relations and deconstructing narratives in international affairs as well as in domestic politics within India. He was previously associated with the Pranab Mukherjee Foundation as a Research Associate and is currently a Research Associate at the Organisation for Research on China and Asia.

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