Pivot Problems

The interplay of two conflicting dynamics in U.S.-India relations – growing strategic cooperation in East Asia and unfolding differences overAfghanistan– will be a key factor to watch for in 2012.


The Obama administration of late has trumpeted a strategic “pivot” toward Asia that is geared toward sustaining U.S. regional leadership amid China’s ascendance. This shift was a central theme in the president’s trip to East Asia last month, when it received a warm welcome by almost all of the region’s capitals. The idea is that disengagement from debilitating military conflicts in the Greater Middle East (Iraq and Afghanistan) will enable Washington to focus urgently-needed policy attention on a part of the world that will be the center stage of the 21st century. Thomas E. Donilon, President Obama’s national security advisor, contends that “by elevating this dynamic region to one of our top strategic priorities, Obama is showing his determination not to let our ship of state be pushed off course by prevailing crises.”

But translating this strategic shift from the drawing board to the real world may prove difficult, particularly as it relates to India. An emphasis on shoring up the U.S. role in an evolving Asia will necessarily entail a deepening of relations between Washington and New Delhi. But events over the last few months offer mixed signals on this front. Geopolitical cooperation in East Asia is indeed on the upswing. Yet America’s quickening withdrawal from Afghanistan also will increase bilateral frictions, thus pushing relations in the opposite direction.

With domestic politics largely driving U.S. strategy on Afghanistan, key differences are bound to emerge between the United States and India regarding the endgame. Looking toward the exits, Washington will not be overly concerned with the exact details of a political solution with the Taliban, while New Delhi will be all too focused on how the strategic terrain in its neighborhood is shifting to its detriment. This gap in interests explains why, according to one informed analysis, “few tears are being shed in the top levels of the Indian establishment over the state of ties with the US.”

India has strong security interests in ensuring that any government in Kabul is capable enough to be a bulwark against Pakistan as well as a gateway to trade and energy links in Central Asia. Both goals would be undermined if Islamabad achieved a central role in shaping a political settlement or if a Taliban-dominated regime were to come to power.

Yet over the last several months, Washington has granted Pakistan a principal role in the Afghan negotiations. In an effort to repair the strains caused by the raid on Abbottabad, Donilon met with Pakistan’s army chief, General Ashfaq Parvez Kayani, in Abu Dhabi in early October, to begin to flesh out a deal: Islamabad would have a seat at the table where Afghanistan’s future is decided in exchange for delivering the Taliban and the Haqqani network to the talks. Two weeks later, Secretary of State Hillary Rodham Clinton, together with newly-appointed CIA director David Petraeus and chairman of the Joint Chiefs of Staff Martin Dempsey, arrived in Islamabad to finalize the bargain.

Negotiations with the Taliban have also reached a critical stage. According to reports, Washington did indeed reach a preliminary accord with the Taliban last month that U.S. officials hoped to unveil at the December 5th international conference on Afghanistan in Bonn until Hamid Karzai, Afghanistan’s president, torpedoed it at the last minute. Contacts with the Taliban are expected to restart early in the new year, and Obama administration officials may hope to announce a breakthrough at the May 2012 NATO summit in Chicago.

There is no love lost between the Obama administration and the Karzai government that New Delhi has invested so much in over the past decade. Given the focus of U.S. diplomacy, one wonders how committed Washington will be to the current regime’s survival or the protection of Indian equities in an accommodation with the Taliban. The security situation also is likely to deteriorate over the coming year as the military withdrawals that President Obama announced last summer take hold and as remaining U.S. forces shift from direct combat operations to a back-stop role. A newly-minted National Intelligence Estimate reportedly is filled with pessimism about Afghanistan’s prospects.

Mr. Obama has promised to help Afghanistan “move from an economy shaped by war to one that can sustain a lasting peace.” Yet new reports by the World Bank and the International Monetary Fund underscore just how formidable, even impossible, challenge that will be. And a recent report by Senate Foreign Relations Committee staffers concluded that U.S. nation-building efforts have largely failed and warned that with Afghanistan so reliant upon foreign military and development spending it could slide into an economic depression as this funding decreases.

The fallout from the Salala incident last month appears to be a transformation of U.S.-Pakistan relations, from the past decade’s broad if epically dysfunctional security partnership to a more circumscribed, largely transactional arrangement. The upshot for New Delhi is variable. Islamabad will be even more stinting in deploying its influence with the Taliban and other militant groups to benefit U.S. objectives in Afghanistan, while Washington will become less concerned about Pakistani sensitivities there. But the much greater restrictions on the preferred U.S. strategy of drone warfare against militant targets in Pakistan’s tribal areas, as well as higher transit fees on U.S. military supplies moving through Pakistan, will further dampen the Obama administration’s fortitude in Afghanistan. This is all the more as the White House enters a bruising re-election campaign in which the president is keen to demonstrate his focus on domestic policy challenges.

The interplay of two conflicting dynamics in U.S.-India relations – growing strategic cooperation in East Asia and unfolding differences over Afghanistan – will be a key factor to watch for in 2012.

Rice’s Revelations and Omission

Condoleezza Rice’s new memoirs contain some interesting details about recent crises in India-Pakistan relations.  But her silence on the peace process they undertook in 2004-07 is unfortunate. 


The disclosures about the landmark U.S.-India nuclear cooperation accord that are contained in Condoleezza Rice’s new memoirs of her service in the Bush administration, No Higher Honor, have been widely reported. Less noticed are the interesting nuggets about two signal episodes in the recent arc of India-Pakistan relations. The first is the egregious assault upon the Indian parliament while it was in session by Pakistan-based jihadi groups in December 2001, which in turn precipitated a serious military confrontation that lasted for most of 2002. The second is the spectacular November 2008 terrorist strike in Mumbai that is often regarded as “India’s 9/11.”

The 2001-02 standoff was the first nuclear crisis of the 21st century. Prime Minister A.B. Vajpayee’s Bharatiya Janata Party government came under tremendous domestic political pressure to respond forcefully to the attack. A similar assault two months earlier on the Kashmir state assembly had caused him to warn the United States that India would be forced to take matters into its own hands if Washington could not convince Islamabad to keep in check terrorist groups operating out of Pakistan. He termed the December attack “the most dangerous challenge so far to India’s national security” and vowed that “we will fight a decisive battle to the end.”

To back up its demands that Islamabad crack down on the militants, India went on a vast war footing, including deploying three strike corps along the border with Pakistan, which reacted with a massive counter-mobilization. In short order, some one million soldiers were arrayed in combat readiness posts on both sides of the border.

Rice recounts that the Bush administration had a difficult time assessing the likelihood of war. The Pentagon believed Indian military moves were to be expected and did not by themselves indicate that an attack was imminent. The CIA, however, concluded that Indian retaliation was inevitable. Washington also received reports that New Delhi was moving nuclear-capable Prithvi ballistic missiles to the border area. Rice recounts that in the closing days of 2001 Brajesh Mishra, Vajpayee’s national security adviser, told her that war fever was rising in the Indian government.

Following diplomatic interventions orchestrated by Washington and London, the standoff seemed to be winding down when a terrorist attack on an Indian army base in Kashmir in May 2002 re-inflamed passions. Vajpayee thereafter traveled to the Line of Control in Kashmir where he chillingly instructed Indian troops “to be ready for sacrifice. Your goal should be victory. It’s time to fight a decisive battle. We’ll write a new chapter of victory.” Concerned that tensions were reaching a boiling point, Washington and London evacuated their embassies in New Delhi (though curiously the U.S. embassy in Islamabad was not vacated).

At this point, according to Rice, Mishra urgently called her to say that “I cannot contain the war lobby without some help.” She adds:

Making it clear that he was acting on his own, he asked that the President [George W Bush] make a statement, which he [Mishra] could use internally to try to hold the line.

Acceding to this request, Bush issued a public statement calling on President Pervez Musharraf to do more to rein in militants and then telephoned the Pakistani leader to underscore the message. Following renewed U.S. diplomatic intervention, tensions abated significantly by the summer months and the crisis concluded anticlimactically by October.

Were New Delhi and Islamabad actually on the precipice of war? Much remains unknown about Indian decisionmaking in the crisis. Rice chalks up the reduction of tensions “to the good work of Brajesh Mishra.” Yet not all Indian leaders believed war was imminent. Foreign Minister Jaswant Singh, for example, has denied that New Delhi was actively contemplating offensive military operations.

Moreover, the window of opportunity for Indian action rapidly closed after January 2002 as Pakistan quickly repositioned forces that were guarding the border with Afghanistan to shore up its eastern flank. For all of the heated rhetoric caused by the May 2002 terrorist attack in Kashmir, senior Indian military officers apparently realized that the likelihood of battlefield success had markedly declined in the intervening months.

The Mumbai terrorist strike that took place in the fall of 2008 was more horrific and brazen than the one that sparked the 2001-02 crisis. In the intervening years, the Indian army had unveiled the Cold Start doctrine which aims to deter Pakistani support for attacks like the one in Mumbai by threatening swift and forceful military retaliation.

Rice states that Washington feared that the doctrine would be implemented in the aftermath of the Mumbai attacks. According to her, the U.S. ambassador in New Delhi, David Mulford, reported that “there is war fever here. I don’t know if the prime minister can hold out.” Asif Ali Zardari’s fledgling civilian government in Islamabad was also spooked by a hard-hitting telephone conversation Pranab Mukherjee, then serving as Indian foreign minister, had with his Pakistani opposite number. Alarmed that India is on the warpath, Islamabad frantically began calling on China, Saudi Arabia and the Gulf Emirates for diplomatic support.

Worry also started to gnaw at Rice when Mukherjee proved hard to reach by phone. She writes: “Is he avoiding my call because they are preparing for war? I wondered. It still didn’t make sense, but it was India and Pakistan, and anything could happen.” When the Indian at last returned her call, he is taken aback by Pakistan’s frenzy. He is in his parliamentary district campaigning for upcoming elections, he explains. “Would I be outside New Delhi if we were about to launch a war?”

A central question in the Mumbai episode is why New Delhi reacted with what can only be described as remarkable forbearance instead of renewed military confrontation as in 2001-02 or with the retaliatory offensives envisioned in the Cold Start doctrine. Rice attributes the quiescence to Prime Minister Manmohan Singh’s determination to avoid war. Indeed, some analysts have observed that compared to Vajpayee’s BJP government that controlled decisionmaking in the 2001-02 crisis, Singh’s Congress Party is more reflective of the preference for military restraint over risk-taking that is ingrained in Indian strategic culture. While the Cold Start doctrine was promulgated during the BJP’s tenure in power, the succeeding Congress government has taken pains to distance itself from the concept.

But more seems to have been at work than just party ideology. For all the effort on Cold Start, Indian military leaders reportedly told the government after Mumbai that the armed forces were ill-prepared to go to war. Indeed, in a February 2010 cable to the State Department, Timothy Roemer, the U.S. ambassador in New Delhi, assessed that the strategy “may never be put to use on a battlefield because of substantial and serious resource constraints.”

Rice notes that she became fatigued by the crisis-prone nature of India-Pakistan relations. So it is even more striking that she omits all but fleeting mention of the intensive back-channel peace process New Delhi and Islamabad undertook in 2004-07. Although the negotiations ultimately collapsed in the face of Musharraf’s domestic political problems, they may have come tantalizing close to defusing the perennially-inflamed dispute over Kashmir.

Rice’s silence is unfortunate. The talks are a significant counterpoint to arguments that the nuclearization process in South Asia has only served to foment greater tension and conflict. And they may also hold relevant lessons for the peace dialogue the two governments are currently embarked upon.

America Lacks An Immigrant Entrepreneur Visa

It would surprise many people that there really is no good way for a foreign national from India or elsewhere to gain permanent residence (a green card) by starting a new company. In fact, it is difficult to even gain a temporary visa as the founder of a new business.

EB-5 Is Not a True Immigrant Entrepreneur Visa

The closest America has today to an immigrant entrepreneur visa is the EB-5 (employment-based fifth preference) immigrant investor visa. The immigrant investor visa became part of the Immigration and Nationality Act in 1990. To receive such a visa, which awards permanent residence (a green card), an individual must invest either $1 million or $500,000 (if in a Regional Center) and create at least 10 jobs. “Approximately 90 to 95 percent of individual Form I-526 petitions filed each year are filed by Alien Investors who are investing in Regional Center-affiliated commercial enterprises,” according to U.S. Citizenship and Immigration Services. While it is clear attracting capital to the United States is positive, EB-5 primarily helps existing projects, rather than facilitates or rewards startup activity.

In addition, Congress and agency regulations have not made it easy for potential immigrant investor visa holders. This is one reason the EB-5 category has never come close to utilizing fully the 10,000 allocation of immigrant visas available under the statute.

American Tradition Favors Establishing an Entrepreneur Visa

While there is no reason to eliminate the immigrant investor visa category – and, in fact, there is a strong case to be made for streamlining its requirements to making it more accessible to potential investors – it goes against America’s tradition to reward cash investments but not entrepreneurial talent in U.S. immigration law. For a long time, the United States favored talent and hard work over cash. An entire genre of literature, the Horatio Alger stories, featured rags to riches heroes. The stories of many of today’s immigrants who become successful entrepreneurs illustrate that talent is a better indicator of success than a healthy bank balance.

Bills in Congress

A number of bills in Congress have been introduced that would establish an immigrant entrepreneur visa. The Startup Act (S. 1965), introduced by Senators Jerry Moran (R-KS) and Mark Warner (D-VA), would create a new green card category for entrepreneurs, focusing on highly-skilled foreign nationals with an existing tie to the United States. The bill “creates a new visa for up to 75,000 immigrant entrepreneurs who hold an H-1B visa or have completed graduate level work in a STEM [science, technology, engineering and math] field, and who during the 1-year period after the new visa is issued register at least one new business entity which employs at least two full-time, non-family member employees, and invests or raises capital investments of at least $100,000,” according to a summary of the legislation provided by the bill’s authors. “If these requirements are satisfied, the entrepreneur would have three additional years to remain in the U.S. and operate his or her business. During the three-year period, the entrepreneur must employ at least five, full-time, non-family members for the business entity. At the end of the three years, a recipient may apply to remove the conditional status.”

The Startup Visa Act of 2011 (S. 565), introduced by Senators John Kerry (D-MA) and Richard Lugar (R-IN), would make an immigrant visa available to a foreign national who raises at least $100,000 from a “qualified venture capitalist, a qualified super angel investor, or a qualified government entity” and creates five full time jobs in the United States (other than for a spouse, son or daughter), raises $500,000 in capital investment, or has an unexpired H-1B visa or a graduate degree in a STEM field from a U.S. university and attracts $20,000 in investment from a qualified investor and creates at least three jobs and generates revenue, or raises capital of, $100,000 within two years.

Legislation by Rep. Zoe Lofgren (D-CA), H.R. 2161 (The IDEA Act) contains similar provisions on establishing an immigrant entrepreneur visa to those contained in S. 565 and S. 1965. However, it also contains a section that eschews capital requirements and enables a foreign-born entrepreneur to receive an immigrant visa if he or she creates 10 or more full-time U.S. jobs within two years, without regard to the amount of outside capital raised.

It is unclear whether Congress will act on any of these bills. Legislative measures that place less emphasis on the amount of capital a foreign national invests or raises fit best within the American tradition of entrepreneurship. It also conforms to today’s reality of how businesses get started. Giving foreign nationals who start new companies deserve an opportunity to follow through on their dreams and, in the process, create jobs and wealth in America.