Former Reserve Bank of India Governor Raghuram Rajan on Thursday warned that an anti-minority image could lead to reduced demand for Indian products in the global market, PTI reported. It might also result in foreign countries perceiving India as an unreliable partner, he said at the Times Network India Economic Conclave.

“India enters the perception battle from a position of strength,” he said, according to PTI. “If we are seen as a democracy treating all our citizens respectfully, and, you know, relatively poor country, we become much more sympathetic. [Consumers say] I am buying this stuff from this country which is trying to do the right thing and therefore, our markets grow.”

His remarks came a day after the Bharatiya Janata Party-controlled North Delhi Municipal Corporation demolished properties, most of them owned by Muslims, in Jahangirpuri. The authorities claimed that the properties were illegally built.

This drive was carried out four days after communal violence sparked off in the neighbourhood when a Hindu religious procession armed with guns and swords passed a mosque.

In the last few weeks, there have been several incidents of communal violence in Delhi, Vadodara, Madhya Pradesh, Maharashtra, Karnataka, Uttarakhand, Jharkhand, Rajasthan and Goa. Two persons died in the clashes – one each in Jharkhand and Madhya Pradesh – while several, including police officers, were injured.

On Thursday, Rajan warned that international relations were also based on perceptions of how a country treated its minorities.

The export of the services sector is a big opportunity for India that must be seized, Rajan said, adding that the Indian government needed to be conscious of the West’s sensitivities.

“The West supports Ukraine because President Volodymyr Zelenskyy is perceived as someone who stands up for democratic ideals, whereas China suffers because of its treatment of the Uighur community and Tibetans,” he said.

Rajan also noted that undermining constitutional authorities like the Election Commission, the Enforcement Directorate or the Central Bureau of Investigation “erodes the democratic character of India”, PTI reported.

Speaking of Covid-19, Rajan said that the medical sector can be leveraged, provided we satisfy data security and privacy concerns.

On the three farm laws that have now been repealed after protests by farmers, the former RBI governor said the Indian administration will have to grapple with the challenges of governance by discussing changes with key stakeholders to avoid such conflicts.

The three farm laws were withdrawn by Parliament on November 29 after more than a year of protests by farmer unions, which had expressed fears that the legislation would make them vulnerable to corporate exploitation and would dismantle the minimum support price regime.