The US has maintained its position as one of the strongest States in the world right now, economically as well as politically. India, on the other hand, while not the strongest, is on its way to becoming a strong economy. Indian policy makers focus on factors likely to affect the economy, on an internal as well as external level. Therefore, the last one year has seen an increasing importance being given to establishing diplomatic and trade ties with foreign states as well. This has helped the economy to improve by moving past its previous stagnancy.
India-US relations in the past: The India-US relationship has been one of cooperation. The Obama administration had been supportive and forthcoming towards trade with India. Cooperation in the field of military had been high with India being termed as a “major defence partner”. Therefore, the change in leadership raised many questions on the future of India-US relations. Despite multiple phone calls between the two leaders and a visit by the US national security adviser to India, and later another by Indian national security advisor to the US, things have not been clear, there’s been a cloud over what direction the India-US relationship is likely to take.
Expectations from Modi-Trump Meeting: The meeting between Prime Minister and President Trump was scheduled for the 26th June. Expectations were kept low since there was no clear precedent to go on, added to that, the fact that this would be the first meeting between the two leaders. There was to be a one on one interaction between the two, followed by delegation level talks, cocktail reception and a working dinner. The following matters were expected to be covered in the meeting:
Purchase of 22 MQ-9B Guardian drones. These are unmanned drones, the purchase of which would help India with better surveillance in the Indian Ocean.
A discussion on the collaboration of the two states without deterring Modi’s ‘Make in India’ Scheme and Trump’s ‘America First’ approach. Both nations are focused on making their own industries and resultantly their own economies stronger. Therefore the meeting called for a frank talk on how to make the two approaches co-exist.
Addressing growing Terrorism and the role played by other countries in the region like Pakistan and Afghanistan who continue to nurture and shelter terrorist groups.
It was expected that Trump would focus on the trade deficit between the nations and insist on equating the balance of trade between them.
Though not high on the list, Modi is also expected to address the H1B Visa policy which would affect Indian techies and other professionals employed in the US. A large number of citizens are known to move to America for better and higher paying job opportunities. The current H1B Visas is likely to reduce that.
Some hoped that perhaps the two leaders could come to some equal level on the matter of Climate Change. Trump has been very critical of India’s part in the Paris Climate Agreement and it is hoped that some consensus would be met with.
However, hours before the meeting, Syed Salahuddin was declared a global terrorist by the US.
The joint statement issued by the two leaders showed that multifarious matters were discussed. As expected, terrorism was an important part of the discussion. Both countries face a major threat from terrorism and have been vocal about their desire to eliminate the threat it poses to them. On a matter related to terrorism, Pakistan was brought in the discussion and it was emphasised that Pakistan needed to bring a change in its policy of sheltering and sponsoring terrorism. The purchase of the unmanned drones (MQ-9B Guardian Drones) was finalised.
The trade deficit between the two nations is to be addressed, and India is to open up its markets and let the US bring in its resources. The focus is on clean energy exports, mainly natural gas. India’s greatest tax reform, the GST, which is to be enforced on 1st of July 2017, is a good thing for the economy and America applauds this strong move. Continuance of counter-terror efforts in Afghanistan. As the US helps India with Pakistan, India must help the US with North Korea.
In an indirect reference, the US has criticised China and Pakistan’s continued disrespect for rules of sovereignty through the constructions under CPEC.
A brief discussion on the trilateral naval exercise to be conducted by the two States with Japan. There were also talks of increased cooperation and collaborations with States in the Middle East.
Given below are a few observations related to the meeting:
1. Syed Salahuddin being declared as a global terrorist is not necessarily the best thing to happen. While it is definitely a positive move by America and shows its willingness to treat Indian problems seriously, it is just a declaration and has very little value. This declaration will seal any assets he owns within the jurisdiction of America and prevent him from getting any financial aid from within America. The declaration does not speak of any use of actual force against the head of the terror outfit.
2. With reference to Afghanistan, the US has remained clear in its counter-terrorism policy. This means India might have to show a stricter policy. While India has spoken out about Afghanistan’s role in the increasing presence of terrorism in India through its homegrown terrorists, India has also attempted to make better trade relations with Afghanistan.
3. With reference to Pakistan, it is hoped that the US will take a stronger and more stringent approach towards the terrorists sheltered by the State. It has been felt that the anger towards Pakistan for supporting terror groups has risen. It has been made clear that the US is no longer looking to make peaceful ties, one can expect a change in the US’s policy towards the terrorists from Pakistan.
4. Relating to Pakistan, the US also made a point in the Statement, condemning that certain nations would respect the sovereignty of India. This can be interpreted as a clear reference to Pakistan and China’s continued disregard for India’s territorial sovereignty through continued constructions under the CPEC projects in parts of Kashmir forcefully occupied by Pakistan.
The US has also said that it expects help from India for neutralising the threat that North Korea poses to peace on a global level. The increased nuclear armament has lead to rising concerns globally. In a recent move, India has finally begun to comply with the sanctions placed on North Korea by the UN, by reducing its trade with the country.
Matters seem to be progressing at the same good pace on the military cooperation front. India had been given the status of a ‘major defence partner’ by the US. several defence deals related to purchase of military equipment have been initiated and completed successfully. The finalisation of the purchase of the unmanned drones is another sign of the growing military ties. In fact, the purchase of the drones comes at a very good time for India. China has been increasing its presence in the Indian Ocean by establishing naval bases in various locations. This has been called the ‘string of pearls’ strategy by many defence and political analysts. The string has caused a lot of concerns for the nation since it has, in a way, surrounded India. While India has managed to develop its naval bases in other States in a well-planned response, there is still cause for worry. Therefore, the drones will enable the Indian security forces to keep a better watch on the movement of the Chinese in the Indian Ocean.
The discussion on the trilateral naval exercise is another indication of continuance of the military ties between the two States.The issue of trade deficit between the two States was brought up by Trump. In this scenario, US expect Indian markets to be opened up furthermore to allow the entry of American goods and services, and therefore balance out the trade between the two States. Under this, the US might expect India to allow access into the Agricultural market- as the WTO insists on India to do. That could be very detrimental to Indian Agriculture in many ways (discussed later). The US can also be expected to get tougher on China.
What was left out:
1. H1B Visa Policy: It seems no discussion took place on the H1B visa policy. This was expected to be one of the biggest points of discussion since Trump’s new visa policy is likely to create a lot of trouble for Indian citizens employed in America. Indian citizens form a significant part of the American workforce. Citizens go to America since companies there tend to offer more jobs with better pay scales. India receives a large sum of money from these citizens through remittances. Since the new policy would restrict those working there, the Prime Minister was Expected to raise the issue in the meeting. However, many political analysts have said that this should not be taken negatively. Several interactions like this are expected to happen in the future, and the issue can be brought up there. Others have said that for the current meeting, there were other more pressing matters like the drones deal. The issue, while important to India, is not at the top of the list in terms of urgency. This policy will affect the mobility of human capital and that will be problematic to not just the other states, but also the US, which might lead to them bringing a policy change on their own.
2. Make In India: While Modi has an optimistic ‘Make in India’ scheme to encourage local manufacturing to boost internal industries, Modi has his ‘America First’, scheme which is aimed at ensuring more job opportunities to the American citizens. Many American countries follow a system of outsourcing work to countries that offer cheaper labour, for e.g. India. Therefore, ‘Make in India’ and ‘America First’ are likely to clash against each other. Given this, many had hoped that there would be some discussion between the two world leaders on this topic and on how to come to a common ground.
Two more points of problems for the two nations have emerged. First, any political analysts believe that while the meeting has largely been a success for both India and America, President Trump’s conduct is something that needs to be considered more carefully. While nothing outwardly has been said, it has become evident that the Trump Administration has a different approach than what was held by the Obama Administration. It seems from this interaction that Prime Minister Modi will have to be more careful in his dealings with President Trump in the sense that India will perhaps to make more initiative. The general consensus of the observers is that India will have to go to America now and show them what we want, why we want them, why America should give us what we want and what they have to gain from us. Trump’s Presidential campaign was based on bringing the focus back to America, American people, American market, employment for the Americans and the American economy, which could be difficult to balance out with India’s plans of exports to America and hope for change in Visa policy to facilitate the Indians to continue working in America.
The second problem is the growing pressure that the WTO and America (amongst other nations) put on India to open up its economy to allow foreign investment. While India has allowed Foreign investment in a lot of sectors, one sector that the government is apprehensive to open up the economy in is the agriculture; foreign powers have, in the recent years, begun to elicit a lot of pressure on India to open up its agriculture market. The problem here is that the while India is a developing nation, its agriculture still forms the primary employment for a bulk of the population. The problem here is that the moment the agricultural market is opened up, a few things will happen. Imports will increase since the big farmers will want to try out the agriculture technologies from the international market. These technologies will be too expensive for small farmers who will either not be able to use these technologies or will get into debt to be able to afford them. At the same time, more agricultural produce will be imported which is likely to hit all farmers, the small farmers more than big.
Many political analysts believe that while things seem to be going well now, a goof move for Indian policymakers would be to focus on not just America, but also other States. In the last few years, India has been deepening its ties with the US and it would be more sensible to focus on the other states as well. Many analysts believe that it’s time India paid attention to its relations with Russia as well. Russia has always been a good friend to India, but ties with them have been ignored a little. Given the place of importance that both US and Russia hold and their ability to affect the world, the best move for India would be to maintain equal ground between the two and keep things on good terms between both the nations. Many people have also said that the US has made a lot of demands from India. The statement seems to mention a lot of things that India is supposed to do such as open up its market, allow export, help with North Korea, etc.
The meeting between Prime Minister Modi and President Trump indicates that the India-US relationship continues in the age of Trump. Many people had qualms about what the future would hold given that Trump has been rather unpredictable in his policies and approach. As a part of the global community and the role that the US plays therein, it is important for India to maintain good ties with them. However, it would be best if India started looking at building equally good ties with other countries as well such as Russia.
Disclaimer: The views and opinions expressed in the article are those of the author and do not necessarily reflect the views and opinions of the Blog.