The Post Pandemic Globalization

While the world fights the Wuhan originated virus, it is unlikely that the post COVID-19 world would be the same. As with any war, the post war architecture undergoes a transformation change with little similarity to the past. The new normal is something different. The current global architecture in social, economic, political, cultural, military and technological governance is a product of the discussions and thinking that emerged in the immediate post World War II regime.

The end of the Cold War with the collapse of the Soviet Union or rather a little earlier through a collapse of the Berlin Wall drove the world into an era of unabashed globalization. The outcome of such an era was the optimization of business resources perhaps an euphemism for cost minimization given the level of price. This led the business to seek new hunting grounds for production something that led them to China. The post “Coronavirus, Global Economy and Redundancy” captures the need for redundancies during emergency. Similarly, the importance of each node in production and distribution and the impact due to their disruption is captured in the post “Wuhan Virus, O-Ring and the Holdout”.  The context therefore is appropriate for an examination of the emergent order.

China’s credibility no doubt has been hit hard. More than the decision to cover up the pandemic in the early stages, its aid has largely been defective. Accounts across the world suggest the defective masks, non-functional tests, non-working protective kits, everything from China seems to be problematic. US has been vociferous so are some quarters from Japan over the need to hold China accountable for the current crisis. The World Health Organization (WHO) has too suffered drastic erosion in its credibility and questions do exist over its continuation in the present form. India is among the countries that are increasingly calling for reforms in global health governance structures.

Given China being the pivot of one side, the new cold war or hot war or whatever means the war is fought, India will be on the frontlines. It has hardly the luxury of being on side-lines and playing relatively safe as it did for most part during the Cold War. The trade off the Indian Non-Aligned doctrine was the complete isolation of India in the immediate post-Cold War era. India had to literally rebuild its standing and relations with the rest of the world in the changed backdrop. India has an opportunity to avoid doing so in the current round of battles between US and China. Ironically, US had turned a blind eye of Chinese expansionism and revisionism in a belief that China would play a role of responsible world power.

Globalization as one knows it was already dead by the pandemic assumed serious proportions. Britain’s rejection of Brexit, the terminal decline of WTO and rise of bilateral and plurilateral trade agreements, Trump’s speech at UN in 2019 calling the current age as the age of patriots all symbolize the death of post-Cold War globalization. The need for relocating production back home and the re-emergence of national sovereignty on economic matters are already underway. If optimization was the buzzword in leading to China production model, the new model will revolve around supply chain security. The new term supply security will perhaps ring in the minds of the business as they set to restart their activities post abatement of Wuhan virus originated epidemic.

There is likely to be a movement from free trade to common manufacturing zones. If the post-World War II led to the development of multilateral security arrangements, the emergent world order is likely to lead to multilateral production and supply agreements. There is bound to be a shift from net global military security provider to net global economic and health security providers. The health governance is likely to shift from WHO to multilateral arrangements. Borrowing from economics, barometric leadership might emerge on the healthcare front with the country known for identification of health emergencies first indicating it to the world to enable prepare better to combat the pandemic. Though Taiwan had indicated the human to human transmission of the virus, the WHO had ignored the same since Taiwan was not a member and was considered a part of China. This thinking will have to undergo a change. There is also a possibility of a country perhaps US taking lead in being health provider of the world. However, the role of US might be a question mark given President Trump’s domestic priority. Yet one cannot rule out the possibility of Trump using the crisis to herald the new political order wherein US will have a major role.

Similarly, to build redundancies, firms might want to operate from multiple zones to continue production in the event of causalities or disruption in one zone. Governments might step in an make it a priority to locate the manufacturing base of domestic firms in those countries which are likely to less disruptive. Japan has already indicated a government support and aid for those industries that are looking to relocate from China. Italy which allowed a free run for China, or rather an economic takeover by Chinese interests in the last 6-7 years would perhaps if acting rationally think in terms of securing economic liberation from China. The approach of Africans, given their heavy economic dependence on China will be watched keenly. BRICS might lose its importance converting into a symbolic exercise. Russia and South Africa are likely to continue as Chinese pawns with uncertainty over Brazil. Quad and Quad Plus are likely to shape to good extent the Indo-Pacific health and economic security order though the success would also depend on the stand of ASEAN countries besides the ability of the current Quad members to overcome their hesitations into conversion as a formal order.

To counties like India, this is an opportunity to radically transform the economic and global thinking. By supplying medicines and healthcare equipment to many countries, India has strengthened its soft power which it can reinforce further in the coming weeks and months and years. While India might not want to shed completely its cautious approach, a dose of realism suggests India become a manufacturing base with supply security safeguards though in the process it might have to temporarily shed its pretensions of neutrality and play safe approach. The post pandemic war will be on the Indian borders and India cannot remain immune to it and must take sides in suiting its self-interest.