What impedes Australia-India bilateral ties?


what impedes Australia

By Rekha Bhattacharjee

While there has been a flurry of visits to India by the high-power Australian trade delegations and politicians, the observers are baffled by the slow pace at which the bilateral ties are growing.

The Australian analysts blame India’s political culture for not only the stunted Australian-Indian ties but also for the slowing economic growth of that South Asian country.

Australia’s trading links with India will not increase substantially and sustainably until India recognises the importance to economic growth and development of big business,” Len Perry Associate Professor Economics at University of Technology Sydney (UTS) wrote recently in his blog.

“Big business magnifies the benefits of economies of scale and lowers prices for the poor, among other things. It thereby contributes to the wellbeing of all of its stakeholders, as well as the economy as a whole,” he further opined.

The Sydney academic has blamed Nehruvian economic policies for converting India into a massive under-achiever and also for ingrained “distrust” of private businesses.

“The economic policies pursued by India’s long-serving first Prime Minister, Jawaharlal Nehru, whose leadership from 1947 until his death in 1964, was marked by central planning and government ownership of major industrial organizations,” Len Perry writes.

“Such was the impact of this policy that businesses were pressured to remain small so as to avoid being answerable to a powerful bureaucracy renowned for its lethargy, incompetence and corruption,” he adds.

India may have shrugged of such ”˜anti-business’ policies to some extent but the distrust of anything to do with western world would still take long to go away. The leaders of the developed economies are doing their best to overcome such stifling levels of distrust.

It would be correct to say that not all of the political commentators share skeptics’ pessimism about Indo-Australia ties.

“Australia and India are poised at an historic moment in their relationship,” Rory Mecalf and C Raja Mohan said in The 2012 Australia-India Roundtable: Co-Chairs’ Statement released by Australia’s well-respected Think tank Lowy Institute recently.

“Building on recent positive steps, the links between the two democracies now need sustained creative thinking and efforts on the part of government, business and society to strengthen them further,” the statement read.

“This will ensure the relationship attains the vast potential offered by the two nations’ exceptional economic and societal complementarities and their convergent strategic interests in the Indo-Pacific region during this Asian Century,” the Co-Chairs further stated.

The Australian political leaders from both sides of the spectrum have been busy to realize the potential to optimum level but for some irritants which refuse to go away.

When the Australian Prime Minister Julia Gillard gave her nod to uranium exports to India in spite of all the opposition (even from within the Labor party ranks) late last year, it was expected that the bilateral trade and political ties would grow at an exponential growth.

“We have changed our party policy so that there is now no fetter for us on selling uranium to India,” Julia Gillard said on her maiden visit to India as Prime Minister few months back.

With the constraint like uranium export gone, the analysts believe there is no hurdle to stop Australia from seeking a greater economic, political and strategic links with the rising Asian economy. Inarguably, there has been an increase in the bilateral trade and societal links but it is the slow pace which worries the Australian policy architects who are wagering on India to cushion any adverse impact from the slowing Chinese economy.

Julia Gillard has no doubt performed well to harness the synergies of India and Australia bonds. Besides visiting the South Asian country and giving prominent place to India in the recently-released White Paper on Australia’s place in the Asian Century, Julia Gillard also indulged in the so-called cricket diplomacy as she honoured Indian cricket maestro Sachin Tendulkar with Order of Australia award.

The links between Australia and India, analysts point out, are not restricted to the clichéd troika of cricket, Commonwealth and curry. There is much more the two ”˜natural partners’ can achieve by working together.

“In a century of growth and change, our interests are closer than they have ever been. We share a region of the world and we share an ocean,” Julia Gillard said in her keynote speech on her October visit to India.

Unlike the Indian policymakers shackled by India’s notorious bureaucracy, Julia Gillard is in a better position to bring in swift changes to facilitate better links with New Delhi.

There is an unmistaken optimism in Canberra, and other political corridors down under, that the only way relations with India can go is northwards.

“I think the exciting thing about it is that our interests are converging and when your interests converge, you have more room to work with. So we have certainly not reached the end of what we can achieve, far from it. I think our best days are ahead,” Australia’s former High Commissioner to India Peter Varghese said last month.

Rekha Bhattacharjee can be contacted at vijay@hotkey.net.au


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