India-Mauritius: An Evolving “Special Relationship”

While cultural, historical and linguistic considerations remain important, economic as well as geo-political issues have taken a substantially more important weight in the equation

As India celebrates its 70th Independence anniversary and Mauritius prepares to mark its 50thone, it is only fitting that the relations between the two countries should be evolving into a more solid and mature affair.

Starting from the time of the accession of Mauritius to the status of an independent nation in 1968 to the present day, the contours of the “special relationship” between the two sovereign states have been defined by the changing socio-economic and political developments in the two countries as well as in the global politico-diplomatic arena. This is not to say that there have been any significant changes every time an alternative political regime has been elected to power in the two democracies. Indeed it is quite remarkable how changes in governments in India, accommodating either the Congress or the BJP, have had very little impact on the relationship between the two countries.

Special relationship

While the two countries have maintained their “special relationship” through thick and thin, it is the content of this relationship which has really been conditioned by the evolving nature of their internal socio-political progress as well as the fundamental and epoch-marking changes in the global environment.

The latter part of the twentieth century has witnessed huge evolution from the bipolar world of the Cold War era and the unleashing of globalization and its neo-liberal agenda which has completely transformed the global geo-political setting. These have necessarily impacted on the way the two nations have re-defined their respective roles in the global economy.

While Mauritius as a Small Island Developing State (SIDS) has forcibly agreed to adapt to the new rules of the game, India has to a large extent chosen to integrate further into the new global configuration, often on its own terms and at its own pace. It is true that liberalization and opening up of the economy in the early 1990s under the impulse of Prime Minister Narasimha Rao and Finance Minister Manmohan Singh was undertaken under excruciating conditions when the foreign exchange reserves of the country had reached unacceptably low levels.

This first “economic shock therapy” though has proven to be hugely positive as it unlocked the entrepreneurship drive and allowed the country to maximize on its comparative advantage – an army of young literate engineers and computer geeks contributed to the first wave of the Information and Communications Technology revolution. This in turn provided an open platform for international business networking and communication which served as a platform for the economic take-off of India and its integration into the global economy.

Thus in a span of only about two decades India had moved from the status of a “paria” nation into a world player – even if it remains a developing country with tremendous challenges especially with regard to the distribution of wealth and the eradication of poverty.

Economic cocoon of protection

During that same lapse of time and after years of living in its economic cocoon of protection and preferential trade agreements, Mauritius also had to wake up to confront the test of a more competitive and challenging global economic landscape. The prevailing “rent seeking” culture, which had been perfected into an art form by both international trade negotiators and the local capitalist class, was manifestly unresponsive to the new environment.

Unlike India then there is a general sense that Mauritius has “missed the boat” through lack of leadership and its inability to develop the vision and accompanying set of policies for the much needed structural transformations that could rid it of the shackles of past. The illustration of this failure is clearly visible in the inverse trends of economic growth in the two countries. While India shed its undeserved and offensive reputation of being afflicted by what very serious economic textbooks used to call the “Hindu rate of growth” (less than 2%), Mauritius which had enjoyed an average rate of growth of 5-6 per cent for a long time is now having to live with a rather meagre 3-3.5% annual growth over the past almost a decade.

The latest issue between the two countries has been the quasi abolition of the Double Tax Avoidance Agreement. Unsurprisingly, in line with the new situation which results from the above developments, the “technocratic” (led by the Indian tax authorities) lobby has finally prevailed over the “political” argumentation. Thanks also it must be said, to say the least, to the cavalier manner in which the Mauritian side approached these negotiations.

The lesson to be drawn is that we have moved a far distance from the “tabla” diplomacy of yesteryears.

Homage must also be paid here to what is perhaps one of the most underrated phases of the relationship which saw the presence of a large number of Indian engineers and other professionals in various government institutions in the years immediately following the independence of Mauritius. Under a special scheme of technical support of the government of India these engineers and other professionals contributed to the construction of public infrastructure and filled the gaping lack of such technical “capacity” which afflicted the country in those days.

Finally the maturing of the relationship can be characterized by the widening circle of interests which needs to be balanced in the relationship between the two countries. These include economic as well as geo-political issues which have taken a substantially more important weight in the equation. While cultural, historical and linguistic considerations remain important they are now less critical factors. It must be said that in this new ball game Mauritius has many assets especially when it comes to the geo-political issues. Its standing as the Star and Key of the Indian Ocean and its status as a full-fledged African nation surely constitutes solid arguments for Mauritius which we should have no qualms to leverage in our negotiations to safeguard our interests.

 

 

* Published in print edition on 18 August 2017

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