India and the World: A look at the 'global context' in Nirmala Sitharaman's Budget speech

Finance Minister Nirmala Sitharaman, presenting her sixth Union Budget on Thursday, sought to place India’s budget in a global context. Sitharaman referred to global affairs becoming more challenging and the concept of globalisation being redefined. She also said a new world order was emerging post-COVID-19. But what did she say exactly? And what is the ‘global context’ she spoke of? Let’s take a closer look: Sitharaman, making her record sixth Budget speech, said, “Geopolitically, global affairs are becoming more complex and challenging with wars and conflicts.” This of course, was a reference to the two wars that have dominated the headlines – the Russia-Ukraine conflict and Israel-Hamas war. “Globalisation is being redefined with reshoring and friend-shoring, disruption and fragmentation of supply chains, and competition for critical minerals and technologies,” Sitharaman added. This comes in the backdrop of New Delhi signing multiple Free Trade Agreements (FTAs) over the past few years including with Japan, South Korea, UAE, Australia and Mauritius. India is also looking forward to signing FTAs with the United Kingdom and with the EU. The finance minister previously said that India is not seeking to reverse the benefits of globalisation, but is asking that it be made more transparent. [caption id=“attachment_13110982” align=“alignnone” width=“640”] India is hoping to sign an FTA with the United Kingdom.[/caption] “…I don’t think India’s alone in doing this, particularly after, let’s say the global view of China after, let’s say the pandemic after also this changing perspective of what indeed is globalisation, how far globalisation, to what extent globalisation. So, when all these questions are happening and being discussed all over the world, India cannot be in isolation,” Sitharaman earlier said. Sitharaman in her speech added that a new world order is emerging after the COVID-19 pandemic.

She said India assumed the G20 presidency during trying times for the world.

New Delhi had assumed the presidency of the Group of 20 – an intergovernmental forum of the world’s major developed and developing economies that comprises Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, the Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the UK, the US, and the European Union (EU) – from 1 December 2022 to 30 November 2023. The G20 accounts for 85 per cent of the global GDP, 75 per cent of international trade, and two-thirds of the world population, making it the premier forum for international economic cooperation. “The global economy was going through high inflation, high interest rates, low growth, very high public debt, low trade growth, and climate challenges. The pandemic had led to a crisis of food, fertiliser, fuel and finances for the world, while India successfully navigated its way. The country showed the way  forward and built consensus on solutions for those global problems,” Sitharaman said. Indeed, UN secretary-general Antonio Guterres had praised India’s Presidency of the G20. He said New Delhi did its best to have the voice of the Global South represented and put the development agenda at the centre of discussion during its year-long leadership of the grouping. “I’d like to say and I believe I should pay tribute to the Indian presidency. The Indian presidency did its best in order to have the South’s voice represented and did its best to put the development agenda in the center of the discussions of the G20,” Guterres said. The G20 outcome document released in August 2023 stated that the nations arrived at a consensus to build more resilient, equitable, sustainable and inclusive health systems equipped to address ongoing global health challenges and future public health emergencies with equitable access to safe, effective, quality-assured and affordable vaccines, therapeutics, diagnostics, and other medical countermeasures, especially in Low and Middle-income Countries (LMICs) and Small Island Developing States (SIDS). [caption id=“attachment_13095102” align=“alignnone” width=“640”] India’s recent G-20 presidency centred around the theme of Vasudeva Kutumbakam. File Photo.[/caption] “The recently announced India-Middle East-Europe Economic Corridor is a strategic and economic game changer for India and others,” Sitharaman said. India, the US and several major economies in August announced an ambitious India-Middle East-Europe Economic Corridor. The corridor, which many view as an alternative to China’s Belt and Road Initiative, was jointly announced by the leaders of the US, India, Saudi Arabia, the United Arab Emirates, France, Germany, Italy and the European Union on the sidelines of the G20 summit in New Delhi. It comprises an eastern corridor connecting India to the Gulf region and a northern corridor connecting the Gulf region to Europe. It will also include a railway and ship-rail transit network and road transport routes. It is expected to stimulate economic development through enhanced connectivity and economic integration between Asia, the Arabian Gulf, and Europe. Sitharaman said, “In the words of Hon’ble Prime Minister, the corridor ‘will become the basis of world trade for hundreds of years to come, and history will remember that this corridor was initiated on Indian soil.’” Modi, at the time of the announcement, had emphasised respect for sovereignty and territorial integrity of all nations while promoting connectivity initiatives. He also stressed on promoting financial viability rather than debt-burden. Both remarks were clearly aimed at China – which has been criticised for its debt trap strategy. Modi also said India does not limit connectivity to regional borders as it believes that connectivity can play a key role in strengthening mutual trust. With inputs from agencies