The just-concluded India visit of Abu Dhabi crown prince Sheikh Mohammed Bin Zayed Al Nahyan is undoubtedly a powerful way forward for India’s “Look West” policy and marks the beginning of a new chapter in India’s ties with the Arab world. Yet, all isn’t hunky dory. Here are the many hits and misses.
Sheikh Mohammed came on a second state visit to India in less than a year and on both times Prime Minister Narendra Modi breached protocol and received the dignitary at the airport, something that an Indian prime minister has done only with respect to the US presidents or the king of Saudi Arabia. Moreover, the crown prince was made the chief guest at India’s Republic Day parade even though he is neither a head of state nor the head of a government.
Add to this the fact that Abu Dhabi’s crown prince was considered over two important leaders for attending Republic Day parade as chief guest – Justin Trudeau, prime minister of Canada, a G8 nation, and Sheikh Hasina, prime minister of Bangladesh, an important neighbour India shares the longest land border of 4096km with.
This puts in perspective the importance of Sheikh Mohammed as well as of the United Arab Emirates (UAE) for India – which is our third largest trade partner in the world after the United States and China with an annual bilateral trade of more than $50 billion.
PM Modi’s reasons for wooing Sheikh Mohammed are not far to seek as the Abu Dhabi Investment Authority boasts of more than $750 billion sovereign funds of which the crown prince pledged to park $75 billion in India’s infrastructure sector about 18 months ago.
Now come the challenges. Not a dime of the promised $75 billion has come to India in the past 18 months. After the delegation-level talks between PM Modi and the crown prince in New Delhi’s Hyderabad House on January 25, the Indian government is in no position to divulge when exactly the $75 billion investment would start flowing into the country.
But India has only itself, its business-unfriendly atmosphere and lack of due preparations to blame for not getting even the first tranche of the $75 billion pie because the chief vehicle which is to drive this ambitious investment from Abu Dhabi – National Infrastructure Investment Fund (NIIF) – is still busy in fastening its nuts and bolts.
At this rate it may well take at least one more year, if not more, before the Abu Dhabi investment materialises. PM Modi is believed to be highly upset over the tardy progress achieved in this context with the UAE.
He is restive but realises that cracking the UAE nut is not as easy as he had thought when he paid a historic visit to the UAE in August 2015 when the offer was first made to India.
Since then, the UAE has made $4 billion worth investment in India through the FDI route but faced major issues within the country. It feels the Indian investment climate is not as good as in China and many other foreign destinations.
The hard fact is that though India and the UAE successfully portrayed a fast-galloping bilateral strategic partnership, the two sides continue to have major sticking points.
On the strategic side, though the Abu Dhabi crown prince put his weight behind a 62-point India-UAE joint statement, which emphasises counterterrorism issues, supposedly sending a tough message to Pakistan. But fact remains that the UAE and Pakistan have strong ties.
Despite the high-octane rhetoric, it won’t be easy for India to wean the UAE away from Pakistan’s influence. Obviously, the UAE is being very clever.
It had militarily supported Pakistan in the 1971 war and is unlikely to disengage Islamabad and indulge in a please-all relationship with India.
The UAE strategy has been to find out what exactly it can extract from India and only then will it decide on making good its pledge of the $75-billion investment.
From the UAE’s perspective, India can help in a big way if New Delhi could do at a faction of the cost what the US has been doing for years for billions of dollar per annum: safeguarding the UAE’s oil and other strategic establishments.
It knows that the Donald Trump administration could soon put an end to the US practice of subsidising the costs of its secure umbrella over the UAE’s oil installations and other strategic assets. India can play the same role at a fraction of the cost.
This, however, may not come into the public domain for quite some time. The question that arises is, if Indian military can fill in the shoes of American forces, can’t Pakistan do so at an even lesser cost? After all, its former army chief General Raheel Sharif has recently been appointed by Saudi Arabia to head its international coalition to take on the threat of militant forces represented by the Islamic State. However, the UAE is apprehensive of Pakistan’s nexus with non-state actors, which the former learnt the hard way recently with the twin terror attacks in Afghanistan’s Kabul and Kandahar in which five of its diplomats and many other UAE nationals were killed.
The UAE has suddenly become aware of Pakistan’s potential of exporting fulminant Islam into its own country. That’s why it chose to make the remarks it did for the first time in the India-UAE joint statement, swearing allegiance to zero tolerance to terrorism – and sustained opposition to “terrorism in all its forms and manifestations”.
However, India must guard itself against the possibility of the UAE playing on both sides of the fence on India-Pakistan issues.