Inside a sprawling golf resort south of New Delhi, diplomats were busy making final preparations for a fast-approaching global summit meeting. The road outside was freshly smoothed and dotted with police officers. Posters emblazoned with the image of Prime Minister Narendra Modi bore the slogan he had chosen for the occasion: One Earth, One Family, One Future.

Not far away, however, were the remnants of bitter division: grieving families, charred vehicles and the rubble of bulldozed shops and homes. Weeks before, deadly religious violence had erupted in the Nuh district, the site of the resort. The internet was shut down, and thousands of troops were rushed in. Clashes quickly spread to the gates of Gurugram, a tech start-up hub just outside New Delhi that India bills as a city of the future.

These scenes sum up India’s contradictions as it basks in its moment this weekend as host of the Group of 20: Its momentum toward a bigger role in a chaotic world order is built on increasingly combustible and unequal ground at home.

Mr. Modi, India’s most powerful leader in decades, is attempting nothing less than a legacy-defining transformation of this nation of 1.4 billion people.

On the one hand, he is trying to turn India into a developed nation and a guiding light for the voiceless in a Western-dominated world. The country, now the world’s most populous, is the fastest-growing major economy, adept digitally and awash in eager young workers. It is also a rising diplomatic power that is seeking to capitalize on the frictions of the superpower competition between the United States and China.

On the other hand, Mr. Modi is deepening fault lines in Indian society with an intensifying campaign to reshape a vastly diverse country, held together delicately by a secular constitution, into a Hindu state. His party’s efforts to rally and elevate Hindus — both a lifelong ideological project and a potent lure for votes — have marginalized hundreds of millions of Muslims and other minorities as second-class citizens.

The question for India, as Mr. Modi seems poised to extend his decade-long rule in an election early next year, is how much the instability caused by his religious nationalism will hinder his economic ambitions.

The sectarian clashes in Muslim-majority Nuh were sparked by a religious march held by a right-wing Hindu organization that falls under the same Hindu-nationalist umbrella as Mr. Modi’s Bharatiya Janata Party, or B.J.P.

They were only the latest flare-up in what has become a seemingly constant state of tensions.

Emboldened right-wing vigilantes and the aggressively Hindu-first messaging of B.J.P. politicians have left the country’s Muslims and Christians in a perpetual state of fear and alienation.

The northeastern state of Manipur, where its top leader has employed the B.J.P.’s majoritarian playbook, has been burning in ethnic conflict for months, with about 200 people killed and regions effectively partitioned along ethnic lines.

In the restive Muslim-majority region of Kashmir, the government has suspended democracy for four years and is responding to any grievance with a tightening crackdown.

B.J.P. politicians continue their divisive rhetoric even when Mr. Modi is on the global stage. In 2020, for example, as Mr. Modi and President Donald J. Trump were addressing a stadium in the prime minister’s home state of Gujarat, large swaths of New Delhi were burning in deadly violence that had been incited in part by B.J.P. leaders.

Gurcharan Das, an intellectual who supported Mr. Modi during his first term for his promise to focus on development, said he had grown disenchanted as the damage of the ruling party’s Hindu nationalism overshadowed its economic progress.

In a public lecture this week, he said that although Mr. Modi’s government had failed to deliver the jobs he had promised, it had still taken up key reforms, from streamlining taxes to help unify the Indian market, to ushering in a digital revolution that has brought more people into the formal economy.

But he said he saw danger as the B.J.P. rejected pluralism as the appeasement of minorities. He repeated a warning that has become frequent: that India is on a path of religious fundamentalism similar to what has plunged neighboring Pakistan into catastrophe.

“While dreaming of a grand civilizational state, Hindu nationalists are in fact trying to create a narrow-minded, identity-based, 19th-century European nation-state — a sort of Hindu Pakistan,” he said.

As India’s economic growth largely enriches those at the top, the masses are still waiting for their promised prosperity. While India is now the world’s fifth-largest economy, ahead of Britain and France, its average income — a key indicator of living standard — remains in the world’s bottom third, next to countries like Congo.

For Mr. Modi, a politics of polarization fills the gap.

Ajai Sahni, the director of the Institute for Conflict Management in New Delhi, said that what distinguished the recent violence in India from its long history of far bloodier sectarian clashes was the attitude of the government.

“The state always notionally distanced itself from such violence. There was always a reaffirmation, at least verbally, of the constitutional order and the secular order,” Mr. Sahni said. Under Mr. Modi, “there is clear, shall we say, evidence of state support or endorsement for extremist positions.”

“The violence is still episodic,” he added. “One killing here, two killings there, then a certain flare-up,” he said. “But the threat is sustained.” He attributed much of that to the “virality” around violence now — social media is “harnessed” to spread a local episode nationally, to chilling effect.

Rajeev Chandrasekhar, India’s state minister for electronics and technology, said the government was trying to tackle potential “misinformation and incitement” online as it intensifies its digital efforts.

In the case of the Nuh violence, online threats and counter-threats in the days before the march made clear the possibility of an imminent spiral, which residents said the police ignored. The Muslim side was also armed and ready to clash when the Hindu marchers arrived.

Five of the six people killed were Hindus, a mix of day laborers who appeared caught in the violence and members of the right-wing group. The minority Hindu residents are now vulnerable in a district where they said they had survived without trouble through even the worst phases of India’s earlier sectarian tensions.

The government, after its initial lax response, responded to the clashes with full force, in what has become an extrajudicial pattern of punishment. Bulldozers were wheeled in to raze homes and shops — mostly those of Muslims — without due process and with the visuals transmitted across the country.

The economic ramifications of the clashes were immediate, and palpable even a month later.

As the violence spread to Gurugram, many offices quickly had employees work from home. Executives at companies in the city told of a fearfulness they had never experienced before.

About 500 families, both Hindus and Muslims, had settled in the shadow of the Gurugram skyscrapers seeking a better life. Now, a majority of the Muslims have left.

“It’s fear,” said Sourav Kumar, who works as a security guard.

Other families had piled their belongings — a tied-up mattress, a couple of tin boxes, a single bed — outside as they contemplated their options.

Just days before the diplomats arrived at the resort in Nuh for final G20 preparations, the Hindu outfit that had carried out the march in late July threatened to stage another one, even though the state’s B.J.P. government had denied it permission.

As the organization pressed on, the government came up with a characteristic compromise: It escorted the group’s leaders in vans so they could offer a prayer at a temple, avoiding another clash for now so the G20 parade could carry on.

Suhasini Raj contributed reporting.

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