Taking ties to higher level

Taking ties to higher level


US President Barack Obama’s second visit to India has been widely hailed as a successful and purposive one. The invitation to him of Prime Minister Narendra Modi can be easily understood as the latter envisages a critical partnership with the US for India. In the same vein, Obama accepted it as he held India to be the foreign policy priority of his administration.

This visit has to be seen in the context of a problematic history that the two share that often obscures several crucial improvements that have taken place since 1990s. Despite India’s historical prominence in the region and America’s global leadership, the two have largely shared an uncomfortable, tenuous and fractious engagement, owing to a number of frictional factors such as India’s non-alignment, nuclear, Pakistan and China related issues and the Indo-Russian friendship. 

After the Cold War, the US and India moved from their historic estrangement to deep engagement. In particular, in the past decade, relations between India and the US—the world’s two largest democracies—have been carefully nurtured,  with the expectation that this  bilateral relationship has the potential to become one of the world’s strategic pivots and improve prospects for global peace and prosperity in the 21st century.

The momentous political alteration continued during Vajpayee and Manmohan Singh’s years as the engagement between India and America evolved by way of strategic dialogues. The unleashing of joint energies guided by a spirit of cooperation culminated in the signing of India-US Civil Nuclear Agreement in 2008. American economic ties with India – which began to open its markets following a foreign reserves crisis in 1991 – were minimal but it too has changed now; the US-India trade in goods and services grew from $15 billion to nearly $100 billion over the past 15 years, and two-way investment has increased rapidly.

However, the last few years witnessed several hurdles in the operationalisation of nuclear deal due to the liability law of India, and economic ties turned fractious. Disputes over issues such as Indian barriers to US poultry and dairy imports, local content requirements (especially in solar energy), intellectual property protections, and investment limits led the slowdown. The US initiated three disputes with India in the World Trade Organisation.

Reportedly, in 2013, the atmosphere deteriorated sharply when exasperated US businesses, industry associations, and members of Congress urged aggressive action. By 2014,   reports of the US International Trade Commission holding hearings on India at Congress's request, and the US Trade Representative's office reviewed India for Special 301 Priority Foreign Country designation, with a further out-of-cycle review in the fall made headlines. The Khobragade incident seemed to illustrate the depth to which the relationship had sunk.

It is under these circumstances that the Modi government undertook to re-energise and transform the relationship. Modi’s US visit in September was the first step in seeking American investments and to develop a strategic economic partnership with America in order to push India’s economy by pressing for trade and investment, energy, defence, and science and technology cooperation. Positive engagements in these key areas were also expected to serve Indian interests in various international organisations and institutions such as APEC and the UNSC.

At another level, discussions on the Immigration Bill, and the reformulating the social security remittances of Indian workers paved the way to the process of reorienting the relationship. In the next few months, the pace and intensity of the discussions over these issues had a positive impact. The decision to invite Obama was part of this new thrust. The bi-national contact group on the nuclear cooperation dispute was given a time bound mandate to overcome the hurdle of supplier culpability and tracking of nuclear materials in perpetuity.

‘Breakthrough understanding’
The visit did, in fact, achieve “a breakthrough understanding” in freeing up the US investment in nuclear energy development in India. The deal would allow  US firms to invest in nuclear energy in India. Quoting the White House, USA Today reported that “the understanding on India’s civil nuclear programme resolves the US concerns on both tracking and liability. In our judgment, the Indians have moved sufficiently on these issues to give us assurances that the issues are resolved,” said Ben Rhodes, Obama’s deputy national security adviser”.

The joint statement has scaled the strategic partnership to a more global partnership. The Defence Framework Agreement has been renewed for 10 years. Agreement on the joint production of specific defence equipment in four projects: UAV, RoRo ISR system for aircraft, hybrid engine of which two would be with US government, two with US MNCs.

There was also agreement on deeper cooperation on terrorism, enhanced maritime cooperation.  A joint approach to peace and stability in Asia and Afghanistan was alluded to by both leaders. Both Pakistan and China were only present by implication, except to note that Pakistan must take action on the perpetrators of 26/11 Mumbai attack. Other areas include several MOUS between various departments of US government like USAID  and ministries of Indian government like urban development, atomic energy, NASA and ISRO, finance, defence etc., have produced a solid roadmap for the future. The main focus is in building smart cities, water and hygiene, solar energy that establish an interlinked future.

Clearly, the visit has achieved not only a breakthrough but has cleared some lingering doubts about the warmth of the relationship. While it is true that the strength of the Indian economy, the altered geopolitics of the region with China’s rise and prevailing dynamism of an interdependent multipolar world necessitate growing closeness, the deft and professional handling by Modi has elevated the bilateral relationship through an endorsement of a new India-US Delhi Declaration of Friendship. For Obama, it is a message that his intentions for foreign policy in his last two years of presidency, the “pivot to Asia,” a reorientation of policy priorities, military and diplomatic interests, is finally happening.

(The writer is professor at the Centre for Canadian, US & Latin American Studies, Jawaharlal Nehru University, New Delhi)