There is little doubt that Covid19 will change the way nations act. It may take a month or six, but ultimately the pandemic will be defeated. No nation or organisation coordinated the global battle; it was every nation for itself. The US, which traditionally led battles against pandemics and recessions, adopted a ‘Nation First’ approach, grabbing all resources needed to fight the virus, even from its allies and locked itself into a cocoon.
The global community is currently in isolation mode with virtual meetings being the order of the day. Fareed Zakaria, a leading foreign affairs expert stated, “The US is abdicating its role as leader of the world. During previous pandemics such as Zika and Ebola, the US was at the forefront of organising international effort. President Obama stepped up as the president of the world.” He added, “In this case, the US is absent. It has no interest in a global leadership role…it is acting childishly.”
Late acceptance of the threat posed by the virus forced President Trump into an isolationist panic mode. Europe remains devastated economically and its health systems are in disarray. EU and NATO, the two organizations which had stood the test of time, are now facing distrust and infighting. The US has ignored NATO allies as it seeks to control the spread of the virus and regain its economy.
EU nations are blocking movement of critical medical stores and equipment, aware that none in the union produces all its needs, inter-dependency being the very basis of its establishment. Agreement on central EU funding to kickstart economies, reached after marathon discussions, may not be enough, and may add to financial woes. Some nations remain more financially impacted than others. The discarding of the demand for issuing a Corona Bond has further divided the EU.
International bodies, including the UN and WHO, no longer bear relevance as these are twisted and used as per the will of nations with a veto. The UNSC just about discussed the pandemic, with no outcome, but could not enforce a ceasefire in battle zones, where the situation remains grim, solely due to the veto power of self- seeking members. It however still finds Kashmir a topic which merits discussion.
The less spoken about the WHO, the better. It is a body which has been overrated and necessitates a complete overhaul. Anger against the WHO is rising globally. Hence, currently, there is no alliance or world organization which would survive the pandemic unscathed. There would be major upheavals as the pandemic eases and nations presently on the fringes of global order raise their voices for a change.
There will be no single power which would dominate the globe. The global community has realised its error of banking on China for being the source of most equipment and raw products. With the virus spreading in Wuhan, world supply chains were severely hampered, leading to nations being unable to build on essential equipment needed for countering the arriving pandemic.
Currently, it is China on whom the world is placing orders for medical equipment. Unofficially the world accuses China of laxity resulting in the spread of the virus. Threats from China on blocking supplies forced Trump to pull back from terming Covid-19 as the China Virus.
Countries which ordered medical equipment were promised the same as a quid pro quo of enabling Huawei 5G in their country. Most still received poor quality products and were compelled to reorder elsewhere or return them. Chinese products would never again carry the same weight as earlier and calls for boycotting Chinese manufactured goods will rise. Chinese owners of an Australian hospital chain closed it down at a critical time demanding additional government funding enhancing local anger.
Taiwan, which nations never recognized due to pressure from China, is now the global donor of medical equipment. It is regaining stature. Japan is leading the battle in withdrawing manufacturing outlets established in China by its companies. It has earmarked a sum of $2.2 Billion for this purpose. Other countries would follow suit. European nations and Australia are reassessing their policies to prevent the Chinese from taking over their failing companies.
Nations have realised it is more logical to establish manufacturing units on home soil or in dependable nations which have stood by them in times of crisis, as against maintaining them in China. Even nations in ASEAN are joining hands to question Chinese actions in the South China Sea. Recently, the Philippines backed Vietnam in challenging the Chinese navy’s sinking of its fishing boat. Nations are unwilling to accept Chinese bullying.
China may continue bulldozing its way globally due to its economic and military power but has lost goodwill, trust and dependability, essential prerequisites for drawing and retaining investments and industry. China will lose its status of being a global manufacturing hub. Companies, under pressure from domestic governments, may move factories to other lucrative destinations. Vietnam, Indonesia, Malaysia, Bangladesh or India, where labour costs are low and establishment of companies is profitable, are possible new destinations.
India which backed a global response to Covid-19 and pushed forth initial discussions within the G 20, leading to a subsequent discussion of finance ministers and central bank governors (due on April 15), is emerging as a reliable partner and amongst possible leaders in the new world order. Its willingness to globally supply hydroxychloroquine, despite growing cases internally, has enhanced its image.
Its proactive decision of leading the battle against Covid-19 within South Asia received global praise. India is supporting rich and poor nations with equal vigour without seeking favours in return. However, goodwill alone may not be enough for India to enhance its economic clout.
If India desires to be the next global manufacturing hub then it needs, apart from winning the battle against Covid-19, to kickstart its economy and announce incentives for companies seeking to establish manufacturing industries in India. It must act before others do. The world is now on the threshold of change and India cannot let this opportunity go abegging. It must act proactively.
(The writer is a retired Major-General of the Indian Army)