Foreign policy has topped the agenda of the Narendra Modi government in its first few months. Soon after taking charge, Prime Minister Modi completed a strategic engagement with the world’s three largest economies – Japan, China and the US – which together account for approximately 40% of the global GDP. This was part of a larger international reach-out that included neighbouring countries. The government’s foreign policy accentuates three elements: economic engagement, security cooperation and energy security. The latest edition of MSLGROUP in India’s ‘Public Affairs Round-up’ (PAR) newsletter analyses the significant progress of the policy. A rejuvenation of the economy cannot be achieved without reforms that are in keeping with the business environment and needs. These include achieving a critical balance between ecological conservation and industrial expansion, as well as more efficient public sector governance. This edition of PAR includes an infographic on the key reforms required. For all of the above, a digital ecosystem could prove to be the game-changer. India has flagged off the Rs 1,13,000 crore ‘e-Kranti’, or ‘Digital India’, initiative – the world’s most ambitious broadband project. MSLGROUP in India puts the initiative under the microscope. We hope you enjoy reading it. For more information or feedback connect with our India team @MSLGROUP_India or reach out to us on Twitter @msl_group.

1. Public A Round-up1
03 Foreign solutions for
Indian problems?
08 Needed: Key legal and
governance reforms 10 The key to growth:
A digital ecosystem
07 Why India is upping regional
engagement
inside
February 2015 | Vol 2 | Issue 5

2. Public A Round-up2
Viewpoint
Love thy neighbours
Prime Minister Narendra Modi has made his foreign
policy the showcase of his first months in office. The
strategy seems to have two centres of gravity: energy
security for the country and the need to balance China’s
regional ambitions.
Already energy-hungry, if India is to recover its economic
mojo, it will need even more energy. Unfortunately, India
manages to generate only 160 GW of electricity out of its
installed capacity of 254 GW. This is largely because India
is dependent on coal-fired thermal plants, but coal is in
short supply. So short that stockpiles are at a 25-year low.
Hydro and nuclear power are critical to India’s future.
Both, Bhutan and Nepal, have huge hydropower
potential. Bhutan’s untapped hydropower potential of
24 GW makes it key to India’s energy security. Nepal,
meanwhile, has tried but failed at implementing large
hydropower projects despite great access to water
resources. An agreement with India’s Satluj Jal Vidyut
Nigam to develop the 900 MW Arun III hydropower
project at a cost of $1.04 billion has been inked. The
plant, expected to start generation by 2020, will export
three-fourths of its output to India.
Finally, the visit to Australia had uranium supplies at the
top of the agenda.
As for China, India is keeping a wary eye on it. Modi’s visit
to Tokyo before China’s President Xi Jinping’s visit to India
upgraded the relationship with Japan. In the pipeline are
technology transfers and defence cooperation. What’s
more, Japan has committed $35 billion to building
manufacturing skills, creating smart cities, building high-
speed rail and cleaning of the Ganga, among other things.
This edition of ‘Public Affairs Round-up’ analyses what
India’s rejuvenated foreign policy will mean for the
economy and the Asian power equilibrium.
The economy, however, needs more than regional
cooperation. There are key legal and governance reforms
crying out to be implemented. That’s what we look at
through an infographic that explains why they are critical.
What’s critical also is a digital roadmap for the country. To
that end, the unveiling of the Rs 1,13,000 crore ‘e-Kranti’,
or ‘Digital India’, initiative is important. The world’s most
ambitious broadband project, it envisages broadband
highways connecting 2.5 lakh villages by 2017. More
than 2,50,000 government schools will get wi-fi and
broadband, with textbooks and other academic material
delivered electronically.
Read on to know what it means for the country as well as
the challenges it faces.
Ashraf Engineer,
Vice-President – Content & Insights, MSLGROUP, India
ashraf.engineer@mslgroup.com
MSLGROUP is Publicis Groupe’s strategic
communications and engagement company.
We advise clients on all aspects of their multi-
stakeholder communication strategies. Our
100+ offices span 22 countries today. Add
our affiliates into the equation, and our reach
expands to 46 countries.
MSLGROUP India is the nation’s
largest PR and Social Media network.
Comprising two leading brands–MSL
INDIA and 20:20 MSL–MSLGROUP India
combined includes 14 offices across 8
key-cities, 550+ professionals partnering
with 220+ clients, national and global.

3. Public A Round-up3
Focus
Soon after taking charge, Prime Minister Narendra Modi
completed his strategic engagement with the world’s
three largest economies – Japan, China and the US –
which collectively account for approximately 40% of the
global GDP. This was part of a larger international reach-
out that included neighbouring countries.
Beginning with Bhutan, his first foreign visit, and then
Nepal, Modi underscored his ‘neighbours first’ policy.
Clearly, this was Modi’s way of projecting strength in
India’s backyard since China does not carry the strategic
weight that India does with smaller countries in the
region.
The foreign policy of the new government accentuates
three actionable elements: economic engagement,
security cooperation to hedge against China’s intentions,
and energy security
Eye on China
China is trying to reshape the geopolitics of the Indian
Ocean through increased naval presence in island states,
especially Sri Lanka and the Maldives.
Foreign solutions for
Indian problems?
Nirav Khatri,
manager – research,
MSLGROUP in India
Global engagement could well be the foundation of
Narendra Modi’s national economic programme
Raising concerns over this, R Hariharan, a retired
Indian army colonel and an associate at the Chennai
Centre for China Studies, told Reuters: “For the first
time, Chinese submarines are being made part of the
People’s Liberation Army in the Indian Ocean region fleet
operation.”
A Chinese media report said that Beijing is planning 18
naval bases across Sri Lanka, Pakistan, Myanmar and
other places in the western and southern Indian Ocean.
The Senkaku Islands dispute between Japan and China
in the East China Sea, resulting in hostile encounters
and heated diplomatic exchanges, was the outcome of
Chinese projection of naval power.
Energy security
India generates only 160 GW of electricity out of its
total installed capacity of 254 GW. A little over half
of its energy needs are met by coal-fired thermal
plants. However, inadequate supply of coal means that
generation falls short of capacity and the energy shortfall
worsens.
A power ministry official, expressing concern at India’s
low coal stockpile of 7.2 million tons, told the UK’s ‘Daily
Mail’: “This is the lowest in 25 years.”
Modi is seriously considering alternatives such as hydro
and nuclear power to reduce paralysing shortages.
With an installed nuclear power capacity of 5.3 GW, an
ambitious plan to reach 63 GW by 2032 is being drawn
up. For this, the supply of uranium is critical.
Raising concerns over this, R Hariharan, a retired Indian army colonel and an associate
at the Chennai Centre for China Studies, told Reuters: “For the first time, Chinese
submarines are being made part of the People’s Liberation Army in the Indian Ocean
region fleet operation.”

4. Public A Round-up4
Asian collaboration
The choice of Modi’s first port of call, Bhutan, was guided
by its strong relations with New Delhi and worries about
China intensifying efforts to win over Thimphu.
India wants to counter this through support for hydro
power projects that would benefit both countries. India
is already the largest recipient of Bhutan’s single largest
export commodity – electricity. Also, Bhutan’s untapped
hydropower potential of 24 GW makes it key to India’s
energy security.
To this end, Modi laid the foundation stone of the 600
MW Kholongchu hydroelectric power station. More
importantly, both countries reiterated their commitment
to produce 10,000 MW of hydropower through a joint
venture by 2020.
Nepal has been unsuccessful in implementing large
hydropower projects despite great access to water
resources. India and Nepal share amicable relations and
the latter’s hydropower projects can only be harnessed
through the former’s cooperation. Modi’s visit acted as a
springboard for this.
Simultaneously, a $1 billion soft credit line was extended
for Nepal’s infrastructural development.
During the SAARC summit, Modi’s second visit to Nepal,
an agreement with India’s Satluj Jal Vidyut Nigam Ltd to
develop the 900 MW Arun III hydropower project at a cost
of $1.04 billion was inked. The plant, expected to start
generation by 2020, will export three-fourths of its output
to India.
The new Indian government seems to be keeping a wary
eye on China, sending it a strong multi-level message
through its strategic regional engagement.
In this regard, Modi’s trip to Japan before China’s
President Xi Jinping’s visit to India was transformational
– it elevated the relationship with Japan from important
to strategic. The Tokyo Declaration will boost, apart from
economic engagement and technological transfers,
defence cooperation through the strengthening of
maritime security across the Indo-Pacific region and
regular joint naval exercises with Japan and the US. This
is a must for shaping a healthy Asian power equilibrium.
Furthermore, Japan’s $35 billion commitment over
the next five years towards building manufacturing,
developing skills, creating smart cities, building high-
speed rail lines and urban subways, the cleaning of the
Ganga, clean energy and rural development is profound.

5. Public A Round-up5
President Pranab Mukherjee’s Vietnam visit just days
before the Chinese Premier’s visit to India too was a
careful diplomatic manoeuvre.
Though the meetings with the Chinese were warm,
nothing much came out of them. China doesn’t need a
special push for investments like India does and border
issues have made it tough for India to take its assurances
seriously.
According to ‘The New York Times’, “China has the ability
to channel billions of dollars into Indian infrastructure
and manufacturing projects, allowing Mr Modi to pursue
the jobs-creation agenda that was at the heart of his
campaign.”
Almost as a consolation, the two nations agreed to
strengthen railway infrastructure through redevelopment
of stations, the setting up of a Railway University in
India and the training of personnel. They also agreed
to develop two industrial parks in India, one for power
equipment and another for automobile components.
Finally, though China has shown interest in India’s nuclear
energy programme, there are regulatory and safety issues
with Chinese reactors that need to be dealt with.
Solidarity with the US
Modi’s visit to the US was aimed at improving the
underperforming relationship with the world’s largest
economy. Indo-US bilateral trade stands at $100 billion;
Modi knows that his strategy of manufacturing-led export
growth cannot succeed without greater access to US
markets.
A meeting with top business leaders preceded the US-
India Business Council committing $42 billion over the
next two-three years.
From an energy perspective, both countries decided on
an inter-agency contact group to sort out outstanding
liability and technical issues to fast-track the 2005 civil
nuclear deal implementation.
Improving Asia-Pacific ties
After attending the India-ASEAN Summit and the
India-East Asia Summit in Myanmar, Modi went to
Australia for the G20 summit, becoming the first Indian
prime minister in 28 years to visit the country.
Australia is keen to deepen strategic ties with India.
During his September visit, the Australian prime minister
sealed a civil nuclear deal to supply uranium along
with more coal and natural gas. India is the first to buy
Australian uranium without being a signatory to the
nuclear non-proliferation treaty.
Also, the Adani Group’s – which is said to have backed
Modi during the general election – interest in coal mines
is well known. Australia’s coal reserves can last for nearly
1,000 years and it exports nearly 7,000 tonnes of uranium
annually.
Critics, however, argue that the uranium deal
compromises safety standards and can trigger a disaster
if the concerns are not addressed immediately.
Modi received a combination of warmth and reverence in
Fiji after his Australia trip. Given its location in the South
Pacific Ocean, the 14 islands, including Fiji are important
because they lie at the centre of a key, resource-rich
maritime route. Therefore, a strong hold on Fiji is
important. While India lagged in giving attention to Fiji for
years, China set up diplomatic missions in almost all the
islands and expanded its naval bases in the region.
Dutourdumonde Photography/Shutterstock.com

6. Public A Round-up6
Fiji’s location is also significant for India to track the pride
of its space programme – the Mangalyaan Mars orbiter.
Modi, who came to power on the promise of reviving
the economy, has so far presented improved foreign
relations as his showcase achievement. While critics have
pointed out that his government has not done enough on
the reforms front so far, it could well be that Modi sees
international collaboration as the underpinning of his
national economic agenda.
India’s energy security imperative
• Energy security is a top priority for the
manufacturing sector and the ‘Make in India’
initiative. India has 13 million youths entering the
job market every year and manufacturing would be
a key employment driver.
• India lost out on producing more than 15 billion
units of electricity due to non-availability of coal in
the last two fiscal years.
• Exploring Bhutan and Nepal’s untapped
hydropower potential should be a priority.
• Australia’s potential to export 7,000 tons of
uranium every year would help nuclear power
generation.

7. Public A Round-up7
Why India is upping regional engagement
Since assuming office, Prime Minister Narendra Modi has made sev eral foreign trips, concentrating on neighbours such
as Bhutan, Nepal (twice), Japan and Myanmar
Indo-US
bilateral trade
is valued at
Rs 6,00,000
crore. Greater
access to US
markets is
necessary to
realise the
strategy of
manufacturin
g-led exports
The visit to
secure
energy
supplies in
the form
of uranium
and coal
Apart from
energy
cooperatio
n, India
wants
China’s
claim over
Bhutan’s
territory
thwarted
The
objective is
to keep a
check on
growing
Chinese
influence in
the country
The
engagement
is intended
to check on
China’s
growing
naval
presence in
the APAC
region
A combined
commitment
of Rs 3,30,000
crore from
both nations to
accelerate
economic
growth
through
infrastructure
development,
augmenting
manufacturing
capabilities,
exchange of
technical
knowhow and
skills
enhancement
Modi’s two
visits put
India ahead
of China in
developing
Nepal’s
energy
industry and
securing its
own supply
US Japan & China
Nepal Bhutan
Myanmar
Australia
Fiji

8. Public A Round-up8
Needed: Key legal and governance reforms
Creating a sustainable legal apparatus that delivers timely, just decisions is the cornerstone of inclusive, equitable
growth. So is governance focused on efficient deli very of benefits. MSLGROUP identifies the key reforms that seek
immediate attention from the ministries concerned
Tribunals
Challenges
• The 29 tribunals operating outside the court structure face distinct challenges: lack of
functional autonomy, difficulty in finding judicial persons with the right expertise.
• This leads to unsatisfactory dispute resolution and negates the benefits of having tribunals
as an alternative to the courts for quick resolution
Recommendations
• Tribunals, appellate tribunals and similar bodies need greater uniformity to their functioning
• Tribunals must draw up their own budgets, raise funds to enable operational autonomy from
parent ministries
• Use technology to monitor functioning, judgments and pending positions
Public
sector
governance
Challenges
• Bureaucratic control
• Lack of financial, technical expertise at management level
• Lack of enough transparency, accountability
• Excessive political interference
Recommendations
• Repeal all statutes establishing non-banking public sector units (PSUs). Transfer
shareholding to companies incorporated under the Companies Act, 2013, and classified in
accordance with the business of PSUs under consideration (operating companies)
• Transfer government shareholding in all operating companies to a common parent company
for better supervision, operational efficiency
• Provide PSUs with a level playing field with other market participants
Reducing
government
litigation
Challenges
• Ill-conceived appeals, slow judicial machinery result in exponential increase in number
of cases
Recommendations
• Implement National Litigation Policy at the earliest to reduce courts’ burden
Challenges
• Forest laws like Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of
Forest Rights) Act, 2006, have failed to create awareness among forest dwellers about their
rights
• Indian Forest Act, 1927, perpetuated through the Wildlife (Protection) Act, 1972, and the
Forest (Conservation) Act, 1980, has vice-like grip over forest land
• Much of the tussle between local populations and forest officials is due to the 1927 act
Recommendations
• Repeal Indian Forest Act and its replacement through an expansion of the rights-based
Forest Rights Act
• Introduce uniform procedure to settle claims to forest land, irrespective of its category
• Reduce forest officials’ arbitrary powers, encourage village councils’ participation in
delivering justice
Forest
laws

9. Public A Round-up9
Challenges
• Varied interpretation of ‘worker’ and ‘employee’ in various acts results in different wage
limits and applicability of benefits
• Unequal application does not provide necessary protection
Recommendations
• Draft a single definition for ‘employee’ and ‘worker’
• Standardise wage limits under various laws for simpler access to benefits
Labour
laws
Challenges
• Bills such as Prevention of Corruption Amendment Bill and Prevention of Bribery of Foreign
Public Officials Bill have serious drafting defects
• Lokpal and Lokyukta Act, 2013, does not empower Lokpal to tackle corruption at state level
Recommendations
• Common definition of corruption as an offence for Indian and foreign bribery
• Protection to whistleblowers
• Clarification of powers of Lokpal and Lokayukta to facilitate thorough investigation and
prosecution
Challenges
• Minority schools imparting quality education exempt from the Right To Education (RTE)
Act, 2009, because of judicial interpretation of the term ‘minority’
• Such schools need not reserve 25% of seats for students from economically weaker
sections
Recommendations
• Obligation under Article 21A should be extended to government-aided schools, even
‘minority’ institutions
• This helps in extending the applicability of the RTE Act far beyond present coverage
Right to
Education
Anti-
corruption
legislation
Sources:
www.openthemagazine.com, Vidhi Centre for Legal Policy report ‘Towards the rule of law: 25 legal reforms for India’, www.livelaw.in, Equitymaster,
www.kpmg.com/IN/en/IssuesAndInsights, www.niticentral.com, indiatoday.intoday.in

10. Public A Round-up10
Viewfinder
The key to growth: A digital ecosystem
More than three-and-a-half decades ago, author and
futurist Alvin Toffler portrayed the post-industrial era
as the Information Age in his book ‘The Third Wave’.
He predicted that the development and distribution of
information will become the nucleus of productivity and
power. Sure enough, information (some would term it as
‘data’) is at the centre of politics, business, sports, virtually
all human activity.
The internet is the medium of this change. Though
internet penetration has crossed 300 million users, India
is still a laggard in terms of embracing government-
delivered benefits through it. Bridging the digital divide
is essential, especially at a time of increasing awareness
about citizens’ rights and the expectations they have from
the government.
Taking note of this, Prime Minister Narendra Modi in his
maiden Independence Day speech listed ‘Digital India’
as a priority. The campaign’s primary objective is to
enable the rapid adoption of technology for governance.
Proliferation of the internet through communication
infrastructure would enable such a transformation. In
an interview to the ‘Financial Express’, Prakash Kumar,
national technology officer at Microsoft India, said: “We
see integrating technology into everyone’s everyday life
as a huge opportunity to achieve better citizen services,
inclusive growth and a digitally-empowered economy.”
The Rs 1,13,000 crore ‘e-Kranti’, or ‘Digital India’, initiative
is the world’s most ambitious broadband project, aiming
to provide digital access through broadband highways
and mobile telephony. Among other things, the project
envisages connecting 2.5 lakh villages to the internet
by 2017 from the current 130,000 at a cost of Rs 32,000
crore. More than 2,50,000 government schools will
get wi-fi and broadband, with school books and other
academic material delivered electronically.
The Andhra Pradesh state government made a beginning
by partnering with Google India to jumpstart the ‘Digital
AP’ vision. This includes creating awareness among
women and a friendly interface with local content. Andhra
Pradesh Chief Minister Chandrababu Naidu told Livemint.
com: “We want to become the first state to embrace
the prime minister’s vision of ‘Digital India’ and set an
example for other states to follow.”

11. Public A Round-up11
However, large-scale execution will be a challenge. A
heterogeneous platform – wireless, fibre optic cables,
etc – is needed. Unfortunately, the main driver of the
programme, The National Informatics Centre, does not
have the capacity to handle even a fraction of the task.
Also, localisation of content is the key to accessibility
for rural and elderly persons, the main beneficiaries of
governmental schemes.
It will be impossible to achieve this mammoth task
without the private sector. A public-private partnership
can create 17 million direct and 85 million indirect jobs.
There is enough evidence to suggest that broadband
equals economic benefits. The Broadband Commission
– an initiative by the UN agency responsible for IT – and
UNESCO found that a 10% increment in broadband
adoption could result in a growth spurt of 0.2% to 1.5%.
The message is loud and clear: if India is serious about
growth, it has to embrace a digital culture.

12. Public A Round-up12
Back
of the Book
3,000
Number of world’s top companies that the ‘Make in
India’ campaign is targeting
Rs 1,00,000 crore
Cost of the Swachh Bharat (Clean India) mission in rural
areas spread over five years
Rs 2,100 crore
What India is spending on building toilets and sewage
treatment plants in 1,649 villages on both sides of the
Ganga in five states
142
India’s ranking, among 189 countries, in the World
Bank’s ‘Ease of Doing Business - 2015’ index
0.5%
Share of India’s inland waterways in overall freight
traffic. This is considerably lower than in the US (8.3%)
and Europe (7%)
34.7 crore
Additional skilled manpower required in 21 high-growth
sectors by 2022
Rs 3,00,000 crore
Estimated investments required in India’s power
transmission sector over the next five years
Twitter board
Dr Harsh Vardhan @drharshvardhan
All children deserve chance to make
contribution to human progress, especially the
differently-abled. Science can make their future
better.
View Summary
Rajnath Singh @BJPRajnath Singh
India is a unique tourist destination full of
diversity. Tourism is one of the Sun Rise sectors
of the 21st century.
View Summary
View Summary
Chetan Bhagat @chetan_bhagat
Give hate speech. Say sorry. Repeat. Until voters
divided into neat little pieces.
Barack Obama @BarackObama
This is huge: The United States and China have
just agreed on an ambitious new joint plan to
cut carbon pollution
View Summary
Arvind Kejriwal @ArvindKejriwal
Aam Admi Party stands for and achieved in 49
days - Big change thro big ideas, Big change
possible thro small spending.
View Summary
Pritish Nandy @PritishNandy
All countries facing economic slowdown should
invite us Indians. We love going to new places
and setting up successful businesses.
View Summary

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