Changing Dynamics of India-U.S. Relations: A time for Introspection

The post-Cold War system has been a multipolar system in which countries like India and China have become significant poles in international relations. However, this system is undergoing a rapid change as the U.S. under the presidency of Donald Trump is increasingly withdrawing from multilateral institutions or engaging in unipolar decisions as seen in escalation of tariffs. At a time of rising trade war and tariff escalation, India needs to assess its relationship with the U.S. very cautiously. As seen in the context of the Paris climate accord or the U.S. pullout from the UNHRC, the current government does not value negotiations and the use of diplomatic tools and relies more on unilateral decisions taken by top leadership. There is a general concern across the world – certainly in U.S. allies and now in India, that the U.S. is increasingly becoming non-amicable in its bilateral relationships. For example, despite being in the F-35 production program for around 20 years, the U.S. blocked the transfer of these fifth-generation fighter jets to its NATO ally Turkey. The main reason behind this being Turkey’s decision to buy S-400 missile defence system from Russia. India has also made a similar purchase with Russia despite U.S. opposition. What this leads to is something that is yet to be seen. Under Trump’s presidency, diplomatic relations of U.S. have seen uneven spiral ride with almost all friendly countries whether be it the EU, Turkey, Canada or India, with the U.S. engaging in tariff escalations and sanctions.

Ronan Farrow in his book War on Peace: the End of Diplomacy and the Decline of American Influence call it a growing structural problem in U.S. diplomacy where short-sightedness, influence of military and intelligence agencies and impulsive decisions instead of calculated actions have taken over. In an attempt to demonstrate power, based on narrow calculations of national interest, what recent U.S. actions are leading to are merely the disintegration of a global order that it itself built and maintained for a very long time. For example, a rewriting of trade rules and making historical changes such as forcing China to stop the usage of abusive economic and military practices have no follow-up strategy despite having benign intent. What lies next is a perpetual question, as there seems to be no calculated policy to achieve long term objectives for such actions.   

For a country like India, the question whether it can become part of any grand U.S. strategy where it has an active role will depend on to the extent to which the U.S. is willing to take into consideration India’s economic and political needs.

For India’s part, the inconsistent foreign policy of U.S. gives it scope to decrease its dependence on U.S. and to diversify its economic and strategic relations with other countries. For example, China’s 25 percent import tariff on U.S. soya beans creates a trade diversion opportunity for India. However, fact remains that currently, India is not an exporter of soya beans to China despite a removal of tariffs (from 3 per cent to zero) on soya beans import from five Asia-Pacific Trade Agreement countries – Bangladesh, India, Laos, South Korea, and Sri Lanka. To reap economic benefits for its own national interests, India could continue negotiations with China to increase the imports of soya beans, in India’s export basket to China. India is the 10th largest global soya bean exporter, and it exported worth US$ 166.13 million soya beans to the world in 2017. It could definitely leverage this to further advantage.

Similarly, in the defence sector, India’s heavy reliance on U.S. needs to be revisited. For example, between 2013-16 India has given 13 defence equipment contracts to the U.S. worth US$ 4.4 billion out of a total of 56 contracts given to foreign countries; and this has been larger than what was given to traditional arms suppliers like Russia or Israel. This has led to India becoming the sixth largest client of U.S. arms with a share of 5.3 percent in total U.S. arms export. This also meant an increase of India’s arms imports from U.S. by a whopping 557 percent during 2013-17. This is not only a contrast to the expected outcomes of the Make in India programme but also a risk in the form of over-reliance on the U.S., and could lead to a fate Turkey had in the context of the transfer of fifth-generation fighter jets.

Nevertheless, there are ample areas where India and U.S., need each other. For starters, bilateral investment relations could be upgraded amid U.S.-China tariff war as there are possibilities of relocation of some of the China-based U.S. companies to India. U.S. ranked fourth in foreign direct investment (FDI) equity inflow with a US$ 2.10 billion in 2017-18 comprising around 5 percent of India’s total FDI. The U.S. investment will not only create a push to the cash-starved Indian economy but also create jobs and develop infrastructure. Both India and the U.S. have similar positions on the issue of terrorism in South Asia, over and above listing terrorists such as Masood Azhar at the UN’s 1267 committee, which China and Pakistan vehemently oppose. In fact, in a recent telephone conversation this year, with US President Donald Trump, Prime Minister Narendra Modi took positive note of bilateral cooperation in areas of defence, counter-terrorism and energy. Beyond these, the U.S. also supports India’s application to the Nuclear Supplier’s Group, which again, is opposed by China. Both India and the U.S. have similar positions on freedom of navigation as well, and share similar suspicions on Chinese grand strategies such as the Belt and Road Initiative.

While statuses such as that of ‘Strategic Trade Authorization-1’ or ‘major defence partner’ are welcome, there needs to be greater alignment between the two countries. In an international system which is becoming increasingly unipolar and pursuit of national interests becomes paramount, India needs to adopt a cautious, calculative and more importantly an independent approach. An overselling of the positives of the bilateral relationship may lead to unrealistic expectations. What needs to be remembered is that despite new avenues of cooperation, a lack of similar concerns between the two countries will make it harder to coordinate policies and interests.

India needs to communicate that more than mere name changes as seen from Asia-Pacific Command to Indo-Pacific is required. Additionally, contradictory actions from Washington such as moving the India Rapid Reaction cell out of the Pentagon and reducing its strength to just two officers need to be questioned. Such actions only lead to suspicions as the question looms large that if India is an important part of the Indo-Pacific strategy of the U.S., then why does the Pentagon have to remove the India office out? A foreign policy that is based on a very thin idea of national interest and apathetic to the views of other countries undermines potential convergences that could have been sustained in the long term. Joseph S. Nye, Jr. argued that “cooperation is a matter of degree, and the degree is affected by attraction or repulsion”. Therefore, a closer alignment of interests and a wider usage of the tools of diplomacy would help in bolstering a better Indo-U.S. relationship at a time when the international system is undergoing rapid changes.

Image: Prime Minister’s Office [GODL-India] via Wikimedia Commons

The views and opinions expressed in this article are those of the authors and do not necessarily reflect the policy or position of the organizations with which the authors are affiliated.

Creative Commons LicenseThis work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.


About the authors

Dr. Pathak is an Assistant Professor and Assistant Academic Dean at the Jindal School of International Affairs, O.P. Jindal Global University, Sonipat, Haryana, India. She can be reached at [email protected].


Saurabh Kumar is an Associate Fellow at CUTS International.

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