Paradiplomacy

GS 2 – Effect of Policies and Politics of Developed and Developing Countries on India’s interests, Indian Diaspora.

Source :  The Hindustan Times https://www.hindustantimes.com/opinion/paradiplomacy-the-possibilities-and-challenges-of-assam-bangladesh-relations-101624019605196.html

Context Recently, Assam chief minister Himanta Biswa Sarma has emphasised the need to explore areas of cooperation with Bangladesh.
Foreign policy is conventionally seen as the exclusive domain of the sovereign State, while paradiplomacy is gaining traction these days.

What is paradiplomacy?
  • The concept of paradiplomacy was first proposed in 1990 by John Kincaid, an American scholar who outlined a foreign policy role for local governments within a democratic federal system. 
  • Paradiplomacy as it is conducted by sub-state governments introduces the idea of decentralisation of political power to make regional governments prominent actors in the international sphere.
  • In more ways than one, paradiplomacy owes its origins to globalisation. As the world economy has become increasingly global and increasingly integrated in a variety of ways, sub-national units (regions, states, provinces and even cities) find their functions and activities circumscribed by the global system.
  • Federalism is also a key contributor to the growth of paradiplomacy.

Global examples

  1. Canada is a textbook example of paradiplomacy
    • provinces like Quebec and British Columbia constitutionally empowered to drive their economic diplomacy independently
  2. CASE STUDY – SAO PAULO
    • City diplomacy
      • With support from Brazil’s Ministry of Foreign Affairs, the São Paulo state government passed a decree in 2012 adopting its own plan for conducting international relations.
      • The plan’s 54 goals included foreign investment and loan targets and ways to boost foreign-language education.
      • The state has become one of the few federated states in the world to establish clear guidelines on how to act externally.
      • In 2013, the State of São Paulo became the first subnational government in the Southern Hemisphere to sign direct bilateral agreements with the United States and Britain.
Paradiplomacy in India

The distribution of legislative powers between the Union and states in India is quite explicit.

  • Article 246 of the Indian Constitution envisages a threefold distribution of legislative powers between the Centre and states, “with foreign affairs, diplomatic, consular and trade representation, participation in international conferences, entering into treaties, agreements and conventions with foreign countries, foreign jurisdiction and trade and commerce with foreign countries, import and export being the areas where only the Union government is considered competent to legislate.

Importance of paradiplomacy in India

  1. As globalisation has eroded traditional boundaries, the Central government by itself is not well-equipped to meet the challenges posed by new political, economic and social forces.
  2. It can be argued that states are often better equipped than the Central government to undertake diplomatic measures in areas of trade, commerce, foreign direct investment, education, cultural exchanges and also outsourcing of business.
  3. There might be cases where the Central government will differ with state governments on ideological and political grounds, which makes it likely that some judgments of New Delhi may not be viewed in the best interest of states and vice versa.
  4. Given India’s size, provincial governments are often better placed to enhance diplomatic relations with other governments in their neighbourhood because of geographical, cultural, historical and economic reasons.
    • For instance, West Bengal can have more successful paradiplomatic relations with Bangladesh and Bhutan than an MEA official stationed at the country’s capital. 
    • Kerala has vested interests in engaging in diplomatic relations with the Gulf countries as a large number of the state’s residents find jobs in those countries.
Some examples of paradiplomacy gaining traction
  • The role of Tamil Nadu’s political parties in India-Sri Lanka relations
  • Gujarat’s economic outreach to the international community
  • The increasing push from the Northeastern states to be involved in India’s Act East policy
  • The establishment of a states division in the ministry of external affairs (MEA).
CASE STUDY – ASSAM AND BANGLADESH
  • Importance of Bangladesh for India
    • Bangladesh is India’s most important trade partner in the South Asian region.
    • Its Gross Domestic Product (GDP) per capita and ranking in Sustainable Development Goals have surpassed those of India’s. 
    • Under Prime Minister (PM) Sheikh Hasina, Bangladesh has initiated action against Indian insurgents taking shelter in the country and settled the boundary issue via the Land Boundary Agreement (LBA) signed in 2015.
Assam – Bangladesh relations – A brief history
  • In the post-2001 period – surrender of a major faction of the United Liberation Front of Asom (ULFA) led by Arabinda Rajkhowa, after Sheikh Hasina became PM, brought relative peace back to the state.
  • 2011 – chief minister (CM) Tarun Gogoi and Dr Manmohan Singh went to Bangladesh when India had signed the protocol for the LBA
    • Both the governments of Dr Singh and PM Narendra Modi involved the Assam government in a proactive way while finalising the deal.
  • Recently – Assam has enhanced economic cooperation with Bangladesh at the insistence of the Union government. 
    • Bangladesh Assistant High Commission has been opened in Guwahati and Bangladesh has opened Chattogram and Mangla port for shipment of goods from the Northeast.
    • The state can push for greater connectivity with Bangladesh via rail, road and air along with a focus on organic food, silk, crude oil, fisheries, tourism and work-permits for skilled youth.
Challenge to the relations?
  • Assam’s struggle to protect its identity and culture against so-called “illegal immigrants from Bangladesh”
  • The Bangladesh government was highly uncomfortable with both the National Register of Citizens (NRC) and the Citizenship (Amendment) Act (CAA)
Way Forward
  • Institutional mechanism
    • The Centre needs to come up with effective institutional mechanisms to introduce paradiplomacy in the country.
    • While one way of doing this is through the creation of consulates or consular offices in individual states, another way of bringing paradiplomacy to see the day’s light is through the setting up of federal foreign affairs offices under the supervision of the MEA.
  • Formal legislations
    • The Centre could also take steps to introduce formal legislations acknowledging the essence of paradiplomacy and its implementation in various states. 
    • The Union government could then ormalize the legislations post overall monitoring in order to push forward India’s stand on key issues of global importance.
Economic paradiplomacy
  • In the area of promoting and attracting investment.
  • FDI policy, certain caps on tax, and environmental benefits would be formulated centrally, but the states would be empowered to liaise with and appeal to foreign investors through trade mission offices, consulate representatives, delegations and other forums.
  • Apart from creating healthy competition for investment, this could also lead to allocative efficiency, where states are able to accelerate the process of attracting investment and technical know-how into sectors where they enjoy a comparative advantage.
Conclusion

Paradiplomacy is still in its nascent stages in India. However, it is clear that the current administration is keen to encourage state governments to develop paradiplomatic relations. It will take some time and may require the emergence of dynamic leaderships at the state level to imitate the success story of Sao Paulo and others.
While the MEA has established a ‘States Division’, the government must engage in better policy formulation and institute clearer guidelines in order to see the fruits of pursuing subnational diplomacy.

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