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India-US Relations Blog

Missed Opportunities, Promising Trends

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The year was filled with missed opportunities but also promising developments in U.S.-India relations.  2012 is shaping up to be the same.

 

President Obama’s state visit to India in early November 2010 appeared to impart new dynamism to a bilateral relationship that had been listless since his inauguration. The trip offered an effective tonic for Indian concerns that he had forsaken New Delhi in pursuit of G-2 collaboration with Beijing. The president spoke of India as “an indispensable partner of the 21st century” and dramatically endorsed its long-standing bid for permanent membership on the United Nations Security Council. Reporting on his giddily-received address to a joint session of the Indian Parliament, the Times of India noted that the “audience lapped it up, with no less than 25 rounds of applause in a barely 45-minute speech. The cherry on the cake, of course, was the ‘Jai Hind’ [Hail India] with which he concluded.”

But the promise of re-energized partnership quickly dissolved as leadership capacity in Washington and New Delhi dramatically waned. In retrospect, the trip’s maladroit timing and messaging should have been a tip-off. That the president’s Democratic Party received an electoral “shellacking” just days earlier meant that he arrived in India a much diminished political figure – a condition that became increasingly evident as time progressed. The White House also put out the word that the trip was essentially a jobs-hunting mission rather than one connected to grand strategy, telegraphing how domestic economic anxieties would continue to take attention away from the foreign policy agenda.

Prime Minister Manmohan Singh also was about to undergo his own political declension. A week after the state visit, the multi-billion dollar 2G telecommunications scandal exploded, igniting a crisis of governance and corruption that continues to engulf Mr. Singh’s administration. For the past year, Singh has been forced to deny that he is a lame duck even as his Congress Party colleagues openly pine for his replacement by Rahul Gandhi and his coalition partners – especially Mamata Banerjee’s Trinamool Congress – feel increasingly free to defy him. As 2011 unfolded, it became more and more clear that Singh’s government was adrift and ineffectual.

The leadership void has contributed to the “Delhi disillusionment” that is now a staple of Washington’s foreign policy conversation as well as the transactional approach some advocate vis-à-vis India. Experts now debate just how steadfast this “indispensable partner” really is. Deputy Secretary of State William J. Burns even felt it necessary to make a rhetorical nod to this discussion with this title to a recent address: “Is There a Future for the U.S.-India Partnership?”

Whatever its technical merits, New Delhi’s rejection of Boeing and Lockheed Martin’s bids in its lucrative fighter aircraft competition – an issue on the Obama administration lobbied aggressively – was handled so ineptly that it reportedly hastened Ambassador Timothy Roemer’s departure from New Delhi. Indeed, many discerned a deliberate snub of Washington. Ditto for the stringent nuclear liability law that is so divergent from international norms that it effectively locks out U.S. participation in India’s nuclear power sector – something that the nuclear cooperation agreement was suppose to bring about. Last week’s debacle on retail sector liberalization underscored U.S. concerns that New Delhi has permitted domestic political concerns to impede closer economic interactions, while the WikiLeaks revelations about the Indian debate over the nuclear accord further undermined confidence in New Delhi’s credibility as a serious strategic partner.

All of these episodes only sharpened questions in Washington about whether New Delhi is as compelling a geopolitical collaborator as the Bush administration had envisioned. They also help explain why the Obama administration has yet to bother nominating Roemer’s successor.

To be sure, the Indians have valid reasons to complain about the paucity of American leadership. President Obama’s announcement of an accelerated disengagement from Afghanistan – a decision driven more by the exigencies of domestic politics than by a careful assessment of U.S. security objectives in South and Central Asia – affects India’s security interests in unpalatable ways. Looking towards the exits, Washington does not seem overly concerned about the exact details of a possible political settlement while New Delhi is all too focused on how the strategic terrain in its neighborhood is shifting to its detriment. This lack of solicitude explains why, according to one analysis, “few tears are being shed in the top levels of the Indian establishment over the state of ties with the US.”

Yet beyond the top-level ructions, the past year also witnessed the growing density of bilateral affairs, especially the accelerating pace of economic interactions. Even with the global economy in the doldrums, 2010 was a banner year for the trade relationship, with two-way goods exports surging nearly 30 percent to $48.8 billion. Merchandise exports were also up significantly in the first half of 2011 compared to the same period last year. All told, India is now America’s 12th largest goods trading partner and one of the fastest-growing destinations for U.S. exports. This is a welcome trend, as increased private-sector linkages are key to limiting the risks that today’s political and diplomatic frictions could escalate and disrupt the overall partnership.

Notwithstanding the disappointments over the fighter competition, the United States has also become a critical player in the ambitious military buildup India is undertaking. New Delhi was the third largest buyer of U.S. weapons this year, with purchases amounting to $4.5 billion – a level ahead of such long-time American allies as Australia, Saudi Arabia, Israel and Japan. Indeed, over the past year or so the Indian government has either purchased or taken possession of a number of key weapons systems: the AH-64D Apache attack helicopter, the C-130J Super Hercules transport aircraft, and the C-17 Globemaster III strategic transport aircraft.

Finally, as the constant parade of Cabinet officers and senior officials between the two capitals attests, bilateral relations have acquired a scope and depth that were unimaginable less than a decade ago. Among other things, Washington and New Delhi now hold regular consultations on policy vis-à-vis China, Deputy Secretary Burns has just concluded talks in New Delhi about strategic and economic cooperation, and a trilateral U.S.-India-Japan security dialogue will meet for the first time next week. Indian foreign policy elites are growing more comfortable with the notion of strategic intimacy with the United States. And the expansion of Chinese strength will undoubtedly push New Delhi to tighten its security relations with Washington in the years ahead, though the process will neither be as smooth nor as speedy as many Americans would like.

All of these factors are contributing to the steady accumulation of bilateral bonds. The key question for the approaching year is whether Washington and New Delhi will exhibit the constancy of leadership needed to capitalize on these favorable developments. Alas, the prospects do not appear promising. With 2012 shaping up to be one filled with turbulent politics in both countries, the focus of President Obama and Prime Minister Singh will continue to remain inward.

Defence And Strategic Affairs Blog

Knocking on APEC’s Door

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India’s absence from APEC is a serious omission for the organization. Its entry should be on the agenda of the upcoming APEC Summit in Honolulu.


apecHaving made the calculation that America’s security and prosperity would be enhanced by partnership with India, the United States over the last decade has promoted New Delhi’s admission into global governance structures. For the Bush administration, this meant doing the heavy lifting required to enroll India into the Nuclear Suppliers Group, an informal cartel governing the global nuclear regime whose original purpose of existence was to exclude New Delhi from its ranks. The Obama administration similarly helped usher India into the Group of 20 forum on the international economy and, most recently, endorsed its long-standing bid for permanent membership on the United Nations Security Council.

The time has now come for Washington to sponsor New Delhi’s entry into another international institution from which it has been barred for much too long.  India for decades has desired formal involvement in the Asia Pacific Economic Cooperation (APEC) forum, which engages over half of world gross domestic product and a large fraction of global trade. But its application has continuously been passed over due to a lack of consensus inside the grouping, which currently numbers 21 members. Some APEC countries have expressed concerns that the institution is too unwieldy as it is and cannot accommodate India or the dozen other interested countries lined up at its door. Others argue that India is not really a Pacific Rim country and is therefore outside of APEC’s geographic parameters.

But with India poised to become one of the world’s top economies in the years ahead, its absence is a serious lacuna for the organization. New Delhi already participates as a full member in regional leadership groups like the East Asia Summit (EAS) and the Association of Southeast Asian Nations (ASEAN) Regional Forum, both important venues for political and security discussions. It is also a full ASEAN dialogue partner.

Southeast Asia has historically been an area of deep Indian trade and cultural influence but was neglected diplomatically during much of India’s independent existence. Seeking to make up for lost time, New Delhi launched the “Look East” policy in 1992. It has proved to be a very successful initiative, paving the way for significant and rapidly-growing economic and diplomatic linkages in the region. The ten member-countries of ASEAN now constitute India largest export market. Southeast Asia takes in more than half of Indian exports, up from around 40 percent just a decade ago.  Indeed, India’s total trade volume with East Asia now exceeds that with the United States or the European Union. And New Delhi’s trade diplomacy has been on a tear recently in Asia, with major economic agreements being signed with Japan, South Korea, ASEAN, Singapore, Thailand and Malaysia. It has commenced negotiations with Indonesia to boost the $12 billion in trade the two countries conducted in 2010.

India has also emerged as a major security player in East Asia and is fast becoming a key factor in the region’s geopolitical calculus. A landmark India-Japan security accord was signed in 2008, and important strategic partnerships have been established with Australia, Indonesia, Vietnam and Singapore. Indeed, Tokyo and Singapore lobbied for New Delhi’s membership in the EAS, over Beijing’s objections, in order to counterbalance Chinese influence in the organization. The United States and India now hold regular consultations on Asia-Pacific policy and a trilateral US-India-Japan security dialogue will be instituted next month in Tokyo.

The Indian navy has been conducting exercises with its U.S. and Japanese counterparts for a number of years now in the Pacific Ocean, and as the brief encounter two months ago between the INS Airavat, an amphibious warfare vessel, and the Chinese navy off the coast of Vietnam demonstrates, the navy is becoming a regular presence in the region’s waters.

APEC’s membership moratorium expired last year. With Washington currently holding the forum’s chairmanship, the Obama administration should be preparing the diplomatic groundwork to place India’s admission on the agenda of the APEC Summit that will take place in mid-November in Honolulu. To avoid interminable negotiations about whether other countries should be let in at the same time, the U.S. might repeat its persuasive line about New Delhi’s entry into the global nuclear order: India is simply so important that it merits a special dispensation.

As a previous post argues, New Delhi’s membership in APEC should be part of an overall agenda for advancing US-India economic engagement. But it would also pay major strategic dividends. In his address to the Indian parliament last November, President Obama urged India not only to “look East” but also “to engage East” for the sake of enhanced security and prosperity throughout Asia. Secretary of State Hillary Rodman Clinton underscored this theme in her visit to India two months ago. Speaking in Chennai (formerly Madras), a port city that has significant economic ties with Southeast Asia, Clinton urged India to take on a larger role in shaping the regional architecture for the Asia-Pacific. Reiterating Mr. Obama’s formulation, she stated that “we encourage India not just to look East, but to engage East and act East as well.”