World

India’s Modi defends open trade despite globalisation’s waning allure

Indian Prime Minister opens Davos acknowledging globalisation's waning allure

DAVOS, SWITZERLAND: India's Prime Minister Narendra Modi acknowledged yesterday that globalisation is "losing its lustre" but warned that new trade walls are not the answer. He was opening a week of Davos meetings that will climax with a speech by the loudly protectionist US President Donald Trump.

After snowfall that stranded some delegates on their way to the Swiss ski resort, the World Economic Forum started in earnest, basking in robust global growth but facing warnings that the world's have-nots are missing out more than ever.

Mr Modi told the forum that India should serve as an example as it opens up to foreign investment, in a speech that had strong echoes of an anti-protectionist call issued in Davos a year ago by Chinese President Xi Jinping as Mr Trump prepared to take office.

"It feels like the opposite of globalisation is happening. The negative impact of this kind of mindset and the wrong priorities cannot be considered less dangerous than climate change or terrorism," Mr Modi said, in the first appearance at Davos by an Indian prime minister since 1997.

"In fact, everyone is talking about an interconnected world, but we will have to accept the fact that globalisation is slowly losing its lustre," he said.

"The solution to this worrisome situation is not isolationism. Its solution is understanding and accepting change and formulating agile and flexible policies for these changing times."

Mr Trump came to office on a populist platform that demonised the globalist Davos elite. And he served a fresh reminder that his rhetoric has teeth - the US President on Monday approved steep tariffs on imports of solar panels and washing machines to protect US producers, triggering an outcry in China and South Korea.

However, in Davos, Mr Modi channelled the founding father of independent India, Mahatma Gandhi, whom he said argued: "I don't want the walls and windows of my house to be closed from all directions. I want that the winds of cultures of all countries enter my house with aplomb and go out also. However, I will not accept my feet to be uprooted by these winds."

That was redolent of Mr Xi last year, who warned that pursuing protectionism "is like locking oneself in a dark room. Wind and rain may be kept outside, but so is light and air."

Undermining rosy data on the world economy are warnings that forums such as Davos must find solutions for everyone else down the income ladder.

"We certainly should feel encouraged, but we should not feel satisfied," International Monetary Fund chief Christine Lagarde said on Monday.

In a separate report unveiled in Davos, Oxfam said the world's richest 1 per cent raked in 82 per cent of the wealth created last year while the poorest half of the population received none.

In his own message to the Davos forum, Pope Francis warned that debates about technological progress and economic growth must not supplant concern for humanity at large.

"We cannot remain silent in the face of the suffering of millions of people whose dignity is wounded," the pontiff's message said. - AFP

WORLD