Since the United States has announced its intentions to withdraw its troops from Afghanistan by 2014, leaders in the White House have been looking toward India as an ally in facing the coming strategic and military challenges in the region. For the U.S., the choice of India is an obvious one. Its growing geopolitical presence and commitment to democracy is a strong force among unstable countries, and deep economic ties with Afghanistan (last year, India gave Afghanistan almost $2 billion a year alone in economic and development aid!) all make India a prime candidate to manage postwar reconstruction. Yet what has been heralded as “a full-blown strategic partnership” in shepherding the region’s development is drastically falling short.
On one side is the growing diplomatic tension between the U.S. and India, which has forestalled bilateral commercial trades and sharply highlighted differences in priorities. To be clear, the U.S. and India have dramatically improved their relationship following the Cold War, when the U.S. sided with India’s rival, Pakistan, and India maintained economic and military relations with the Soviet Union. Since then, economic interests were better aligned, as bilateral trade has reached almost $100 billion just last year alone. Still, India is defiantly opposed to complying with U.S. demands if they were to compromise its own economic interests. In Iran, for example, the U.S. has called for sanctions against Iran’s growing nuclear capabilities, and has asked India to cease its commercial transactions with the country. But India views things differently, stating that oil and natural gas purchase from Tehran are vital to its economy. Moreover, Indian diplomats assert that it is “in India’s interest to maintain good ties with Iran, with whom it shares deep historical, cultural and religious connections.” They also believe that purchasing Iranian oil will “strengthen ties with Iran as a hedge against an uncertain future in Afghanistan after the U.S. withdrawal,”, and are thus reluctant to rebuke Iran’s nuclear purchases.
Differences in priorities in China are also a source of contention between Indian and U.S. lawmakers. The U.S. has made strides in containing what it perceives to be a geopolitical threat by China, due to its growing military strength and influence in Asia. Indeed, leaders in Beijing have even suspected that the U.S. is attempting to partner with India in containing China, claims that the U.S. staunchly denies. But India is not interested in upsetting China and has worked very hard in cooperating in areas of mutual interest and opportunity and believes than an alliance with the U.S. will fracture that relationship.
Finally, currency problems in India are hampering its ability to provide stable finances for Afghanistan’s reconstruction. High interest rates have destabilized India’s investment climate, forcing it to focus inward and shrink expenditures.
The future of the U.S.-India relationship will depend heavily on who wins this November. The Democratic Party will likely continue on its current trajectory, gently pushing India to open its markets for investment and to align with the U.S. The Republican Party’s foreign policy is traditionally more aggressive, and will probably reiterate demands for Indian liberalization and compliance with Iran sanctions.