Beyond cricket and curry: India could be the next big thing

Australia has been talking about the huge potential of India for decades now. It still is. "It's a classic case of underperformance – high on potential, low on delivery," says Shaurya Doval, the head of the India Foundation, a think tank aligned with the ruling Bharatiya Janata Party, during a visit to Melbourne on Monday.

India, already the world's fifth biggest economy, is expected to be No. 3 within 15 years. And also the most populous, overtaking a fast-ageing China around the same time. "The sky is the limit," says Shaurya.

The founder of London-based investment company Greater Pacific Capital, Ketan Patel, says India is on an unstoppable trajectory, despite a recent growth slowdown: "It took India over 50 years to become a $US1 trillion economy, it took seven years to become a $US2 trillion economy, and five years to get to three trillion", which it's projected to reach this year. India's government has now declared that it plans to hit $US5 trillion in another five years.

"The maths of it are going in the right direction but it's not a planned economy, it's a democracy of 1.3 billion people so it's going to be volatile along the curve." Australia's Future Fund apparently believes in the maths, too – it recently committed money to one one of Patel's funds as a long-term investment.

And the bilateral relationship hasn't been a total anticlimax. India has grown to become Australia's fifth biggest trading partner; India is the biggest source of new Australian immigrants at the moment. But, as Penny Wong put it in a speech on Monday, Australia needs "the conversation about our ties to go beyond the three C’s — cricket, curry and the Commonwealth".

Scott Morrison is taking up the challenge of turning some of the potential into reality. The timing is good. He's due to visit in a few weeks for talks with the freshly re-elected Indian strongman-type prime minister Narendra Modi. Modi increased his majority in the parliament for the next five years while the leader of the once-dominant Congress Party, Rahul Gandhi, lost not only the election but also his own seat.

With a flurry of Australian conferences, delegations, strategies and political interest centring on India just now, it's high season. And beyond the activity, there's a new Australian hopefulness, too.
With Donald Trump's America angrily self-absorbed, China rampant and Australia feeling vulnerable, there's fond hope that India could help Australia with new markets as well as perhaps a touch of mateship.

You could sense the wistful as well as the wishful in Tony Abbott's speech to the India Foundation a few weeks ago: "A partnership between two democracies such as India and Australia should be far easier to build than one between Australia and a one-party communist state like China.

"Perhaps this is why the relationship between Australian and India, until recently, has largely been taken for granted; while that with China has been carefully cultivated by all governments and assiduously fostered by all prime ministers since Bob Hawke."

There are other reasons the India relationship has been a bit stuck. India has seen Australia as a second-rate Britain. Australia has seen India as second-rate China. Each country has to get past its stereotype of the other.

Patel says it's happening, slowly, from the Indian viewpoint, helped by the fact that Brexit Britain and Trump's America have been losing appeal in recent years: "You had a bunch of people coming to Australia that traditionally would have gone to Britain or the US. So your appeal is that not only have you built a great society, you are the beneficiary of other people's issues." And these students coming to Australia generally like what they find, he says. Changing perceptions of Australia one family at a time.

One serious blockage to more Indian interest is the Adani mine. It's a bit of a paradox – Australia's resources are supposed to be a key drawcard for foreign countries' interest, but in India's case we have seen a decade where resources are a serious obstacle.

First was the Rudd government's decision to deny India access to Australian uranium, and now it's the political controversy of the Adani coal mine. The delays and difficulties of developing the mine have sent a troubling signal to Indian investors, according to the chair of the India-Australia Strategic Alliance think tank, Sydney-based businessman and doctor Jagvinder Virk: "The way they see it, 'Australia doesn't respect someone who invested $3 billion, I'm thinking of investing a few hundred million dollars, how will they respect me?"

On the Australian side, the federal government commissioned the chancellor of Queensland University, former secretary of the Department of Foreign Affairs and Trade, Peter Varghese to write a blueprint for long-term engagement. Varghese says the Morrison government has set up the bureaucratic and ministerial machinery necessary to implement his plan, but he doesn't see big firms taking India seriously yet: "The big end of town still doesn't buy the India story," he told a recent conference. "There are some people who have dealt with India that are still in therapy. It's a case of a once bitten, twice shy corporate view on India." But, he said, India had changed and Australian firms needed to pay "sustained attention".

Australia should take advantage of its 700,000-strong Indian population, says Dr Virk, who organised Tony Abbott's recent program of high-level meetings all the way to and including Prime Minister Modi based on his personal contacts alone. "Australia should use us – we have the connections, we have the knowledge."

He says that Australia, unlike Britain, Canada or the US, has failed to accept its Indian population into its power and political structures. Canada has 19 ethnic Indian MPs and five federal ministers, he points out, where Australia has none.

For the India Foundation's Shaurya, what's most needed now is for Morrison and Modi to put in place the frameworks that only governments can provide: a trade and investment agreement is essential to deep and sustained growth, he says.

India can't be another China. But it can be a serious source of economic growth and opportunity as well as a diplomatic and political partner for Australia. One that isn't trying covertly to "take over" our political system, as Beijing is trying to do, in the words of former ASIO boss Duncan Lewis. Could India be the next big thing? Potentially.

Peter Hartcher is international editor.