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India-US Relations Blog

Fighter Shoot-Down

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India’s elimination of Boeing’s and Lockheed Martin’s bids in its $11 billion fighter aircraft competition – one of the country’s largest-ever defense deals – is bound to have negative repercussions for the U.S.-India relationship. Analysts had expected at least one of these bids to advance to the final selection round; that neither did is being perceived as a deliberate snub of Washington. John Elliott, a long-time observer in New Delhi, interprets the move as an effort aimed at “keeping the U.S. firmly in its place.”

http://www.usinpac.com//images/stories/F-16IN_AT_AeroIndia2011.jpgThe Indian decision will add to Washington’s growing list of bilateral frustrations and is yet another sign that ties between the two nations continue to fall far short of the promise that glistened just three short years ago when the landmark nuclear cooperation accord was concluded.  That news of India’s action coincided with the (unrelated) announcement of Timothy J. Roemer’s resignation as U.S. ambassador in New Delhi only heightened the sense of disillusionment and fatigue.

The decision makes some sense on the basis of technical merits. The F-16 aircraft proffered by Lockheed Martin is a widely-used workhorse but also a 30 year-old platform; that Pakistan is one of the 26 air forces flying the plane also could not have endeared the Indian defense ministry. Boeing’s F/A-18 is a much newer system but it reportedly did not perform well in flight tests over the Himalayan ridges in Ladakh.  Eurofighter’s Typhoon aircraft – which New Delhi has shortlisted for possible selection – has much to recommend it technically. Additionally, the four-nation Eurofighter consortium (composed of British, German, Italian and Spanish defense companies) – along with France’s Dassault Aviation SA (whose Rafale fighter also was advanced to the final round) – also was more generous than the U.S. companies in terms of technology transfer.

American companies (including Boeing and Lockheed Martin) have snapped up a number of recent contracts from the Indian military, and one can expect New Delhi to award additional deals in the coming months as palliatives for U.S. disappointment at losing out of this highly lucrative transaction.

Some Indian commentators are of the view that, with bilateral ties now so multi-dimensional and mature, Washington’s sense of letdown will be fleeting. But this is likely to prove wishful thinking.  The Indian decision will certainly not derail bilateral affairs. But given the Obama administration’s aggressive lobbying on behalf of the American bids, it will only deepen the perception in Washington that New Delhi has not lived up to its side of the bargain by reciprocating the huge commitment the United States has made over the past decade to bolster India’s great power prospects.

As Siddharth Vadarajan, the strategic affairs editor of The Hindu, notes, Washington came at the fighter deal with “all guns blazing.” The U.S. campaign included President Obama, who made a personal intervention with Prime Minister Manmohan Singh during his state visit to India last November and then followed up in February with a letter underscoring “the strategic importance the United States attaches to the selection of a U.S. proposal in India’s Medium Multi Role Combat Aircraft competition.”  Ambassador Roemer was tireless in pressing the same message.  And to sweeten the pot, the United States granted India the opportunity to participate in Lockheed Martin’s program to develop the advanced technology F-35 fighter aircraft – an offer that New Delhi effectively rebuffed last December when it opted for a joint arrangement with Russia to develop a separate fifth-generation fighter aircraft.

As an earlier post argued, Washington is becoming increasingly weary of New Delhi’s capacity for strategic engagement. The political soap opera accompanying the Indian parliament’s debate about the nuclear cooperation agreement in the summer of 2008 was disheartening from the U.S. perspective and could hardly inspire confidence that India was ready to move ahead with full-throttle cooperation. Adding to the list of sorrows is that the nuclear liability law adopted by India last year has the effect of all but blocking the involvement of U.S. companies in India’s nuclear energy sector – one of the things that the nuclear deal was supposed to bring about. (And following Japan’s nuclear disaster, U.S. hopes that New Delhi would revisit the law anytime soon are stillborn.) And despite numerous suggestions for bi-national endeavors at producing clean energy technology, Washington is miffed that Indian restrictions on imports of solar-power technology are thwarting the entry of U.S. firms into one of the world’s fastest-growing solar-energy markets.

Boeing's F/A-18 at the Aero India 2011 air showTroubling as well are reports that a major factor in India’s elimination of the Boeing and Lockheed Martin bids was the military’s continued wariness of the United States as a full-fledged strategic partner. In contrast to institutional memories of past U.S. technology embargoes that still linger throughout the security establishment, the military supply relationship New Delhi has forged with Paris – Dassault’s Mirage 2000 fighter has long been in service with the Indian air force – seemed to play an important role in the decision to shortlist the Rafale. The Obama administration had worked hard to ease these memories, including advancing the F-35 offer and the further easing of U.S. export controls on India that were announced in February.  Mr. Obama’s letter to Prime Minister Singh also made promises on this score.

While India’s decision will certainly not produce a bilateral rupture, its consequences may be more pronounced than the rosy scenario sketched by the optimists. At a moment when the Obama administration has begun to turn its attention back to New Delhi, it will reinforce nagging doubts in Washington about India’s willingness to make the big decisions necessary to dramatically advance the relationship.  Such doubts could even break into the open given the bilateral frictions likely to ensue as the United States approached the endgame in the Afghan conflict. There may be solid technical reasons behind the fighter decision. But the soundness of its strategic logic is about to be put to the test.

India-US Relations Blog

The Ties that Bind

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Three years after the conclusion of the path-breaking civilian nuclear agreement, the U.S.-India relationship suffers from the lack of a new energizing project. In its first year or so, the Obama administration did not display much interest in continuing its predecessor’s high-profile engagement with New Delhi, turning its attention instead to expanding ties with Beijing. To be sure, the United States more recently has moved to re-engage India, as evidenced by the warm sentiment flowing from President Obama’s state visit last November. The problem is that Mr. Obama’s rhetoric during the trip made it sound like the visit was more connected to his export-promotion initiative than to any grand foreign policy objective.

For its part, New Delhi is a constrained strategic partner, one that is not well-equipped – ideologically or institutionally – to take on bold bilateral projects. While Prime Minister Manmohan Singh finally did manage to push the nuclear agreement through a balky Parliament, his victory was in important measure pyrrhic, in the end revealing just how small the consensus (see the analysis here and here) is among Indian political elites for undertaking ambitious bilateral initiatives.

Credit: thesouthasian.comThe paucity of visible leadership in both capitals is problematic. It is true that both governments are collaborating as never before at the bureaucratic level. But the U.S.-India partnership has yet to find sure footing and still lacks sufficient institutionalization to advance the new era in bilateral relations. Robert Blackwill has warned that “neither the U.S. nor the Indian bureaucracies at present are yet prepared instinctively to facilitate a deeper and more intimate degree of cooperation between the two countries….It is going to take leadership and direction from the top to change old habits and attitudes.” Ronen Sen has made a similar point: “We have not reached the point where the relationship can be placed on auto-pilot. It still needs to be nurtured.”  And the Hindustan Times noted last year that the Washington-New Delhi connection is still not yet “a machine that will move on its own steam.”

The burden of advancing bilateral affairs, at least in the next few years, will have to be borne by the key societal bonds that helped build the relationship in the first place.  Headlines about the nuclear cooperation accord and expanding military ties notwithstanding, it is important to bear in mind that the foundation for the partnership was actually forged outside the realm of government policy and far beyond the confines of Washington and New Delhi. Unlike most of the relationships maintained by the United States with other leading countries, the one with India is distinguished by the signal role played by societal ties and privatesector initiatives. As Shivshankar Menon, now Prime Minister Singh’s national security advisor, remarked last year, “[I]f anything, the creativity of [American and Indian] entrepreneurs, engineers and scientists has sometimes exceeded that of our political structures.” And Nicholas Burns, who did yeoman’s work in hammering out the details of the nuclear accord, emphasizes that societal bonds are “the greatest strength in the relationship” and that “the big breakthrough in U.S.-India relations was achieved originally by the private sector.”

Consider, for example, the dynamics at work a little more than a decade ago. In response to the 1998 nuclear tests, Washington imposed an array of economic sanctions on India and expelled visiting Indian scientists from U.S. government laboratories. Yet at the same time, concerns about the “Y2K” programming problem led companies in Silicon Valley and in India to set the foundation for today’s strong technology partnership. And as I wrote earlier, the Indian-American community, relatively small but highly influential, has lead the way in building new ties between its native and adoptive countries.

credit: charlierose.comThe significant role played by these societal bonds has caused Fareed Zakaria to compare U.S.-India ties to the special relationships the United States has with Great Britain and Israel. Shashi Tharoor has likewise remarked that “in 20 years I expect the Indo-U.S. relationship to resemble the Israel-U.S. relationship, and for many of the same reasons.”

Although they are often overlooked by national policymakers, societal bonds give fuller texture and equipoise to the bilateral partnership than could be hoped to be achieved at the intergovernmental level alone.  And at a time when bureaucratic mechanisms are not firing on all cylinders, strengthening these ties will be one key in securing the growth of broad-based, resilient relations over the long term since they work to limit the risk that political and diplomatic frictions could escalate and disrupt the overall U.S.-India partnership.

This is particularly important as the structural dynamics of the bilateral relationship will prove challenging to manage in the future.  The basic framework of U.S. security and economic relations with a number of key countries in Europe and Asia was laid down in another era of world politics, when the national power of these states was in decline.  The resulting alliances were, and in many ways still remain, unequal partnerships.  In contrast, India’s power trajectory is upward.

Moreover, foreign policy elites in New Delhi continue to insist on the prerogative of strategic autonomy and, hence, are unlikely to accommodate Washington’s priorities as readily as other U.S. allies.  With continuing divergences over foreign policy objectives, frictions will inevitably develop on a range of issues – from global trade negotiations, climate change and nonproliferation policy, to differential approaches on Afghanistan and Pakistan, as well as India’s bid for a higher profile in world affairs. As Nick Burns cautions “the United States must adjust to a friendship with India that will feature a wider margin of disagreement than [Washington is] accustomed to.”

India-US Relations Blog

What Indians (Some) Want the U.S. to do

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There is little doubt that the left in India wish the United States ill–not that the U.S. has done them any harm. The Indian left, ever since the Soviet bloc collapsed and China turned capitalist and aggressive, has needed an imperialist enemy to focus their enmity upon. After all, their version of socialism or communism ruined nine odd countries whose people revolted against the rule of the proletariat and went back into the capitalist fold. So the U.S. wish to democratize other nations and slap around a few dictators evokes little sympathy in places like JNU.  Opposing national stands taken in other capitals, are looked at by the Indian left benignly, unless the capital concerned is Washington. Any disagreement with Washington arises, according to the left, from an imperialist or capitalist plot, as is for instance the U.S. envoy in Delhi reporting to Washington (according to wikileaks) that dealing with a Mamta ruled Bengal would be easier than dealing with Buddhadeb. If the U.S. consular office reports that Hyderabad is the Center of an Indian visa application forgery scam, that too must be a capitalist plot.

Most Indians have a sensible view of the United States and world order. What do the sensible majority wish the U.S. to do? They certainly don’t want what they see as a huge Republican negativism in opposing the ruling party – for the sake of opposition – even if it means dragging the U.S. down. We have enough of that in our own country, where the beneficial nuclear deal was opposed by a right wing  – left wing anti-national coalition in parliament, when the nuclear deal was originally a BJP idea.

May be a world led by the USA is not an ideal world – but it is more acceptable than, say, a world in which the Chinese have the last word. So the majority of Indians wonder, when is the U.S. going to pull itself out of the economic doldrums, and re-invent itself, as it has done so many times in the past? When are the happy days of oodles of I-20 visas, a thriving Silicon valley, huge back office contracts and masses of desi California weddings coming back? The US-India relationship is largely run by the people, in any case. If we left it to the government they would lower it to the same ‘estranged’ levels as existed in the 1980s. The strength of the U.S. lies in technology innovation. That innovation is converted into dual use merchandise and military power. This process is the US’ monopoly. Techno-innovation comes from concentrating the best brains around booming university towns. To make all that happen again, the U.S. government must pour money into technology innovation, start ups, entrepreneurs and university research. Will the U.S. do all that? Do they have the money to create jobs, fix medical insurance and still have enough money to plough back into the process that makes the U.S. the number one nation? Indians are worried.

Delhi has enough unpredictable allies and friends – from Myanmar to Bangladesh to Sri- Lanka and Afghanistan. But all these unpredictabilities are small compared to the future of the US. Even two U.S. authors of Indian origin have joined in predicting a failing future for the U.S. – but the majority refuse to give up hope.  Of course Obama’s speech on cheap Indian medicine doesn’t help. Hasn’t he seen that the U.S. and India grow rich together? Or that, if the U.S. launches another technological revolution, in say, alternate energy, the Indians in the U.S. will link Indian back offices and labs to execute that revolution to the mutual advantage of both countries?

The Indian government is just as wayward as the U.S. government – flirting with a non-entity of alphabets like BRIC. We really have nothing in common with China buying our iron ore and dumping manufactured goods on us. Our relationship with Brazil is a really stretched concept. The bilateral relationship with Russia is healthy and strong without lumbering it with China and Brazil, in a pointed slap to the Americans. But that is what governments do – make diplomatic headlines  that are of no consequence on the ground.

India-US Relations Blog

A US-India Nuclear Alliance

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Although President George W Bush understood the need to ensure parity for India with France and the U.K. in a 21st century alliance calculus, the Europeanists within his administration slowed down his effort at ensuring an equal treatment for India. Much the same as Winston Churchill in the previous century, they regard it as a “country of a lesser god” that is simply undeserving of any except a subservient status. Sadly, the Obama administration has become even more a Europeanists’ delight than its predecessor, and it has very rapidly sought to dilute the few concessions that President Bush succeeded in extracting from his skeptical team.

Credit: IBNLive.com

This has been especially pronounced in the nuclear field. It is not rocket science that India’s ascent into middle income status will depend on a huge increase in its generation of energy, and that such an increase, given existing green technologies, will need to be powered mostly by energy from nuclear sources. The nuclear industries of India and the U.S. have excellent synergy between them, provided the U.S. acknowledges the implicit premise of the 2005 Singh-Bush statement and the 2008 unanimous vote of the Nuclear Suppliers Group to allow commerce and cooperation with India.

The non-proliferation lobby within the U.S. (a group heavily represented in the Obama administration) made India its primary target since 1974, neglecting to take account of the leaching of nuclear and missile technology from China and other locations to Pakistan and North Korea. Small wonder that it has demonized the India-US deal as a “danger to non-proliferation efforts”, despite the fact that a democracy of a billion-plus people is as much entitled to critical technologies as France or the UK. The reality, however, is that the Manmohan Singh government made several concessions to the U.S. side that have had the effect of substantially degrading India’s offensive capability. An example was the closing down of the CIRUS reactor, which was producing weapons-grade plutonium for decades. In exchange, India was to be given access to re-processing technology. Not merely has such technology continued to be denied to India, but the Obama administration is seeking to cap, roll back and eliminate India’s homegrown reprocessing capabilities.

Apart from strong-arm (and secret) tactics designed to force India to agree to the Comprehensive Test Ban Treaty (CTBT) and the Fissile Material Cut-off Treaty (FMCT), the Obama administration is now seeking to force India to give up its Fast Breeder Reactor program. As if on cue, those commentators in the world’s second-largest English-speaking country – including those not known for any previous interest in matters nuclear- who hew to the line of any incumbent U.S. administration have used the Fukushima disaster to call for the FBR program to be abandoned.

Whether by accident or by design, since 2007, this program has slowed down substantially, to the dismay of scientists working in the Atomic Energy Establishment who were rooting strongly for the India-US nuclear deal on the premise that this would ensure a much-needed alliance between the nuclear industries of both countries.

 Instead, because of the present administration’s steady drumbeat of fresh conditions (and retrogressive tweaking of existing agreements), nuclear cooperation between the U.S. and India has remained frozen, even while that with Russia has bloomed. Hopefully, such a state of affairs will not continue for long.

One sector where a vigorous India-US partnership would immensely benefit both countries (of course, on the assumption – challenged by key elements in the Obama administration – that India is entitled to the same status as other key U.S. allies) would be in the field of thorium. India has nearly 300,000 tons of thorium (Th), more than enough to power the nuclear industries of both countries. India has already gone a substantial distance towards a viable thorium-based technology. The catch is that this involves reprocessing on a significant scale, a technology that the Churchillians in the U.S. administration say should be denied to India. This is despite the fact that when anyone last checked, India was not an authoritarian state but a democracy. Unless of course, such a prejudice is based on instincts that are not mentionable in polite company.

Despite having been treated as a pariah state by the US, India consistently abided even by agreements that the U.S. side had unilaterally discarded, for example at Tarapur. In this facility, a huge amount of radioactive material has piled up, that India has not re-processed, despite having the technology to, because the plant was set up in collaboration with the US. Some of the spent fuel has been converted after much expense and effort from unsafeguarded radioactive material to safeguarded irradiated fuel, especially in RAPS 1 and 2.

Despite such good behavior, not to mention an impeccable non-proliferation record, the Obama administration in effect continues to treat India as a nuclear pariah, seeking to drive it down to the status of a recipient country under the proposed international scheme for nuclear cooperation. Such a mindset would put paid to any possibility of an India-US alliance, and would be very good news to a country that U.S. non-proliferationists treat with kid gloves, China.

Credit: www.dae.govIndia has already developed two thorium-based systems, the Advanced Heavy Water Reactor (AHWR) and the Compact High Temperature Reactor (CHTR). Although for some reason there seems to be a sharp deceleration in such plans by the present Manmohan Singh government, plans are for the entry of the Indian private sector in this greenfield industry. Ideally, these would partner with U.S. companies, but the way matters are going, it would seem that Russian state enterprises may eventually end up as the preferred partners. This is presumably the reason why there is a significant lobby within India that opposes those within the government who seek to buy either the F -16 or the F-18 for the Indian Air Force. The continued reluctance to give India its due as a major power is behind the skepticism in South and North Block about relying on the U.S. for critical defense equipment. The Obama administration’s cavalier treatment of India’s rights as a responsible nuclear power are behind the pressure by elements of the armed forces to backtrack on plans for a comprehensive defense partnership with India. India gets treated as a Sudan or as a Gautemala in such a pairing, rather than get located in the same bracket as France and the US.

 

Despite their worst efforts, the plan to once again consign India to the bottom of the nuclear heap will not succeed. The 21st century mandates a vigorous partnership of the two most populous Anglosphere countries, India and the US. The non-proliferationists in the U.S. ought not to be allowed to make this hostage to their refusal to admit that India and its population are as responsible and deserving of privileges as the people of major U.S. allies in Europe. Should such a Churchillian view on India continue, the geopolitical gainers would be Russia and China.

India-US Relations Blog

India-US Medical Alliance will cut deficit

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The U.S. is – and will continue to be for at least a generation more – the primary engine driving the international economy. If Asia has made progress during the post-colonial period (i.e.after 1947), one of the major reasons is the U.S. economy. Although the Eurocentric administrations in Washington DC refused to sanction a Marshall Plan for Asia the way they implemented for Europe, the private industry has made up for a lot of the slack. Although the Vietnam war of the 1960s and beyond was a disaster in several ways, including the devastation it caused to that land and people without being able to prevent the takeover of the country by the Viet Minh, yet the purchases of goods and services made by the U.S. from the countries of East and South-east Asia for prosecuting  the war created tigers out of pussycats. Even Hong Kong developed,once the British withdrew east of Suez and lost interest in the day-to-day running of the colony.

India under Indira Gandhi missed the US-driven bus. Unlike Thailand, Japan, Singapore and South Korea, she refused to create the conditions needed for Indian businesses to take advantage in the spurt of U.S. procurement created by the Vietnam war. Indeed, she turned away from such opportunities, even rejecting an invitation to be a part of ASEAN. As for industry, Indira Gandhi continued with Jawaharlal Nehru’s policy of strangling the private sector through taxes and regulation, and creating state-owned monopolies that were citadels of incompetence and corruption. Small wonder that SE Asia and East Asia rapidly overtook India and entered the fold of middle-income countries two decades before India finally began to catch up in the mid-1990s,  a rise that has been threatened by the sharp increase in regulation seen in the Sonia Gandhi-led UPA since 2004.

Despite the return of frank Nehruism in central policy, India still remains a country where the newly-empowered private sector is fighting back. Honest corporates are happy at the increase in public awareness of the fact that it is graft on a monumental scale that is keeping them in such misery. Those traveling by the potholed roads of India; enduring power cut after power cut despite sky-high electricity prices; going through substandard public schooling at a time when the UPA is seeking to choke the private education sector through fresh regulations; and suffering such depredations as income-tax raids conducted just to collect bribes for settlement, are now coming on to the streets. If not in 2012, certainly by 2013, India will have its own Tahrir Square, with millions likely to picket the homes of the powerful trinity of corrupt bureaucrats, businesspersons and politicians who have aped the British colonial authorities by enriching themselves through impoverishing the country. For the first time since the 1950s, India seems to be on a path towards cleaner government and greater powers to the ordinary citizen vis-a-vis the colonial-style state,largely because of the pressure from the Supreme Court and the fact that Prime Minister Manmohan Singh is personally honest,and hence has no personal interest in continuing to cover up corruption.

This is the ideal time for a great democracy to create multiple linkages with India, so that civil society in both countries can benefit. In the field of energy, this writer has already pointed out how the negative bias of the non-proliferation lobby in the U.S. is creating the conditions for an Indo-Russian atomic alliance from which the U.S. will get excluded. Healthcare is another field in which India has several advantages. Indeed, it is this potential that is scaring pharmaceutical and fat-cat medical lobbies in Europe, making them invent risks in India that are unproven by scientific evidence. The Lancet, for example (whose advocacy of the medical mafia in the developed world is transprent) has been printing report after report warning individuals to keep away from India. The latest smear is that the country is swarming with a “superbug”. Unexplained is why such a “deadly” microbe has made zero dent on the country’s population, or in its health services. The reality is that cooperation with India will cost the medical mafia in several countries their millions of euros, hence the hysteria against India.

The fact is that only – repeat only – an alliance with India can reduce healthcare costs in the U.S. and the EU to levels that are compatible with continued prosperity. Instead of blocking low-cost Indian pharmaceuticals from entering their (or other) markets by the foisting of cases and by other means, EU governments should get their corporates to form alliances with Indian companies that can ensure low-cost healthcare to billions of people in Europe, India and in North America.

However, given their mindset (which is clearly still lost in nostalgia for the colonial era), it is unlikely that the EU will follow such a rational path. On the contrary, we can expect several more efforts to malign both the country as well as its medical profession, because of the fact that it can provide healthcare at a fraction of the cost charged by the medical mafia. Rather, it is the U.S. that needs to take the lead in forming an alliance with India, that would ensure enhanced Indo-US production of cheaper drugs and cheaper procedures. Unless this be done, the U.S. budget deficit will continue to balloon to a level that threatens the future of the world’s biggest economy. The sharing of healthcare facilities by India and the U.S. will ensure the saving of tens of billions of dollars every year, and in time form a fusion that can bring healthcare to the doorsteps of the needy in every country.