India plans own democracy index after being downgraded

Prime Minister Narendra Modi’s administration has engaged a prominent Indian think tank to devise a domestically crafted democracy ratings index. This initiative aims to counter recent downgrades in international rankings, which New Delhi worries could impact the nation’s credit rating.

The Observer Research Foundation (ORF), known for its collaboration with the Indian government on various endeavours, is formulating the ratings framework, as per sources closely involved in the project discussions. This index is anticipated to align more closely with New Delhi’s perspective compared to Western-centric rankings, which Modi’s team has criticized.

New rating will be released soon

People related to the project declared that ORF would release Democracy Rankings within a few weeks. Though the exact timeline remains uncertain, including whether the index might debut before India’s imminent national elections announced last Saturday, the official suggested its imminent release. India’s elections are scheduled in seven phases, commencing on April 19, with vote counting on June 4. Modi is strongly favoured for a third term in office.

ORF co-hosts the Raisina Dialogue, India’s counterpart to the Munich Security Conference and the Shangri-La Dialogue, among other significant geopolitics and geo-economics conferences. This year’s Raisina Dialogue took place from February 21 to February 23.

NITI Aayog, the government’s public policy think tank responsible for facilitating internal discussions within the Modi administration regarding global rankings, stated it was not developing the index. However, it neither confirmed nor denied its involvement in assisting an external think tank in its preparation.

Political analysts say that over the past three years, there is a mounting concern within the Modi government regarding challenges to India’s democratic credentials, including those highlighted in a report prepared by India.

Reaction to India’s democracy was downgraded

This initiative commenced shortly after international indices, such as the US-based non-profit Freedom House, downgraded India’s classification from a free democracy to a “partially free democracy” in 2021. Additionally, the V-Dem Institute, based in Sweden, categorized India as an “electoral autocracy.” The Economist Intelligence Unit’s 2020 Democracy Index ranked India 53rd, designating it as a “flawed democracy,” citing factors like the Citizenship Amendment Act (CAA), the National Register of Citizens (NRC), and the revocation of special status in Indian-administered Kashmir.

The CAA, whose implementation was announced shortly before elections – four years after its passage by parliament – introduces what critics describe as India’s first religion-based citizenship test. Essentially, asylum seekers from neighbouring nations who are not Muslims can gain an expedited path to Indian nationality.

Meanwhile, opponents argue that the NRC initiative threatens the expulsion of millions of people whose families have resided in eastern and northeastern India for generations but lack formal birth documents, a situation common among many Indians. In 2019, India terminated a special constitutional provision that granted Jammu and Kashmir semi-autonomous status.

While India’s ranking in the Economist Intelligence Unit’s (EIU) Democracy Index notably declined between 2016 and 2020, there has been a slight improvement since then, rising to 41 (tied with Poland) in 2023 from 46 in 2022. However, it continues to be categorized as a “flawed democracy.”

The Indian government has rebuffed these international rankings, asserting that India does not “require sermons.” Indian Foreign Affairs Minister S. Jaishankar in March 2021 criticized the institutions behind these rankings for their “hypocrisy” and labeled them as “self-appointed custodians of the world who struggle to accept that someone in India is not seeking their approval.”

Other countries are also challenging the rating’s criteria

The Indian government isn’t alone in challenging the criteria used by agencies for sovereign ratings. Independent economists have also raised questions about these indices.

One of the main components of a sovereign rating often revolves around a country’s per capita income. This as a common criticism shared by India, Brazil, Indonesia, and other major developing countries. Democracy and political stability, although part of the qualitative assessment by rating agencies, carry relatively small weightage in sovereign ratings compared to factors like per capita income.

Critics are questioning the government’s focus on proving India’s democratic credentials and its impact on the country’s sovereign rating.

In June 2020, the Indian government initiated steps to create its own index to counter Western downgrades. The Foreign Ministry proposed encouraging Indian think tanks to produce an annual world democracy report based on comprehensive parameters. Additionally, it suggested that Indian diplomatic missions engage with organizations such as V-Dem and Reporters Without Borders (RSF) to provide information that would influence India’s positioning in democracy and press freedom indices.

Despite challenges in engaging with organizations like the Economist Intelligence Unit (EIU), the Indian government persisted in its efforts. In 2021, it urged Om Birla, the speaker of India’s lower house of Parliament, to brief heads of foreign missions in New Delhi on Indian democracy’s robustness, providing him with “speaking notes” for the purpose.

However, an India-developed democracy rating might lack credibility if perceived as influenced by the Indian government. Such an initiative could potentially harm India’s reputation and it might be best to focus on ignoring subjective elements like democracy in sovereign ratings.