Narendra Modi is about to complete two years in office as the Prime Minister of India. In the past two years improving relations with other countries has been his primary focus area. Though during his pre-election speeches he didn’t make many references with regards to his foreign policy. It was going to be one of the most important spaces to be watched over by his opponents and others as well as he was considered inexperienced. But surprising all, he has been very successful in improving India’s foreign relations.

The start itself was very spectacular, he surprised all by inviting heads of states of SAARC countries for his swearing in ceremony, even before he formally took charge of office. He has taken care of India’s interests very well, particularly in the neighborhood though some challenges remain there, in Nepal and Pakistan. He has improved relations with Bangladesh and Sri Lanka. His visits to ASEAN, USA, France and UK have also been successful, though it is a little too early to comment but the trajectory that he has given to India’s ACT EAST LINK WEST policy is spectacular. His visits to BRICS and India-EU summits also yielded favorable start, a renewed push to India’s efforts to increase its influence in the world.

The third India-Africa summit at Delhi is also a step in positive direction, as China has done very well in Africa, this includes a naval base in Djibouti. His visits to Seychelles and Mauritius have further strengthened our position in the Indian Ocean region, a region where we cannot lose ground to China.

Diplomacy, in most crude terms, is the management of foreign relations of a country by art of negotiations. He has certainly given more substance to it. He has been using cultural diplomacy and Economic diplomacy very well. In this article we take a look at how he has been using Economic diplomacy to secure India’s interests.

Economic Policy as the hinge pin of Foreign Relation:

We live in a time where the need for placing greater focus on Economic policy is well recognized. Indian representatives posted abroad have so far concentrated more on political work. Modi, in way of sorts, has become the “Super Ambassador” for India. His Economic Policy has been a major underpinning of his foreign visits. Modi has attached sufficient importance to Economic interests and defense interests. For instance, India became the first country to purchase Uranium from Australia despite not being a signatory the International non-signatory treaty. This should bode well for India’s energy sector which is facing chronic shortage. India and Australia finalized a civil nuclear deal that would allow India to buy Uranium from Australia. This announcement came after Modi met Australian PM alongside G-20 meet in Antalya, Turkey.

Major objectives of Economic policy of a country is to influence commercial, economic and political policies of host country to make it conducive for our national interests. Also, working with international bodies like WTO, IMF, World Bank and other multilateral platforms for shaping their decisions in interests of our country.

Modi has taken a firm stand at WTO for protecting our interests. He has also been a big advocate of improving relations with European Union, ASEAN and its ASEAN Economic Community, RCEP. In this time when USA and China have been working with other countries for shaping trade treaties like TPP, FTAAP; we will have to watch every foot we put forward very carefully, as these may or may not always work in our interests.

We now take a look at two of the most important partnerships taking shape under Modi.

India and USA

It is India-USA relations where Modi has been able to turn around things pretty deftly. In December of 2013, during the Devyani Khobragade episode, things looked much worse, though even at that time it was certain that it would remain a temporary episode but Modi was quick to realize that if India has to ensure steady growth and flow of investments then USA has to be the major source of it.

Modi has already visited USA on multiple occasions and Obama became first USA president to visit India twice during his time in oval office. Modi’s efforts seem to be working well, USA expressed its support for India’s membership at Nuclear Supplier’s group, today only, as I am writing this article. Though China has been working with certain other countries to ensure that India doesn’t get to be a member of NSG but USA’s open support is very important to notice here.

India and Japan

India maintains close relations with Japan as a result of Economic diplomacy. The Japanese companies like Honda, Sony, and Toyota were in fact among the first to make investments in India. India is also a big market for Japanese companies. Japan will be investing 3.5 billion Dollars in India in next five years, both in Public and Private sectors. A large part of this money would be invested in Ganga Rejuvenation, Smart Cities, transport systems, next generation infrastructure and skill developments.


Narendra Modi is changing landscape of India’s Economic and Foreign Policy by merging the two deftly. It is difficult to say whether its Economic policy that turns around Political Policy or vice versa. It is heartening to see that Under Modi, the Foreign Office and the Finance ministry have realized the importance of Economic policy in securing India’s interests.

Contributor: Sachin Diwaker