India's Modi Claims Economic Protectionism Is Hurting Global Trade -- Update

By FeaturesDow Jones Newswires

DAVOS, Switzerland--Indian Prime Minister Narendra Modi called for greater international cooperation on issues such as climate change and cited the rise of protectionism as a threat facing the world, presenting a vision at odds with U.S. President Donald Trump's "America First" approach.

"Many societies and countries are becoming self-focused. Globalization is shrinking," Mr. Modi said in a speech on Tuesday at the annual World Economic Forum, adding that this trend was as grave a challenge as terrorism. "Protectionism and its forces are rearing their heads."

Continue Reading Below

Mr. Modi's keynote address at the start of the four-day event comes ahead of Mr. Trump's closing remarks on Friday, potentially bookending this year's gathering in Davos with competing ideas on global integration.

Under Mr. Trump's leadership, the U.S. has withdrawn from a Pacific trade agreement and signaled its intention to pull out of the Paris climate deal. Mr. Trump has voiced skepticism about multilateral trade blocs and pledged to defend American firms against foreign competition.

"Prime Minister Modi's speech represented the spirit of Davos, which obviously presents a contrast with what we're likely to hear on Friday," said Peter Fanconi, chairman of the board of Switzerland-based BlueOrchard Finance Ltd., who was in the audience. "We're going to hear the whole spectrum of thoughts on this."

Mr. Modi's defense of globalization echoed remarks Chinese President Xi Jinping made last year at the same forum. "Pursuing protectionism is just like locking one's self in a dark room," Mr. Xi had said.

In his hourlong speech, Mr. Modi also sought to distinguish India from China, stressing the need to strengthen democracy.

"We believe in a multipolar world order," he said, quoting from ancient Indian scriptures and the teachings of Buddha on cooperation and peace.

Stressing the need for greater discussion on climate change, Mr. Modi raised concerns over melting glaciers and the risk of islands getting submerged as sea levels rise. His cooperation with former U.S. President Barack Obama helped clinch the Paris climate agreement and changed India's image as an obstructionist player.

Mr. Modi charted the progress India has made toward its ambitious goal of producing 175 gigawatts of renewable energy by 2022. India's consumption of coal is expected to rise as it develops, but Mr. Modi wants clean energy to make up a larger share of the mix.

"His remarks show India wants a larger role on the most important issues of the day," said Sumant Sinha, chief executive of ReNew Power, an Indian solar and wind-energy producer. "The other message, equally important, was that India is open for business."

Mr. Modi is leading a large delegation of government and business leaders at Davos as he looks to attract investment and ramp up growth. Asia's third-largest economy is seeking a path to development matching the pace and scale that lifted millions in China out of poverty.

China has been one of the biggest beneficiaries of globalization, which helped the country become the world's factory floor, producing everything from clothes to solar panels. Mr. Modi is hoping India is next as growth in China slows and investors look toward other developing economies.

Mr. Modi said Tuesday he wants to double the size of India's economy to $5 trillion and has invited the world to set up manufacturing operations in India.

Write to Niharika Mandhana at niharika.mandhana@wsj.com

(END) Dow Jones Newswires

January 23, 2018 11:09 ET (16:09 GMT)

Continue Reading Below