Nantoo Banerjee
He came, he saw and conquered almost everything. US President Barack Obama revisited India this time with a clear objective – to derive an effectively no nuclear liability concession for American atomic plant and equipment suppliers, to get India play a strategic partner to contain China in the Asia-Pacific region and to arm India. Going by the joint statement by the US president and Prime Minister Narendra Modi, Obama has succeeded in his summit objective. The US president did not leave the pomp and show of India’s Republic Day celebration that followed the summit to deviate from his principal tour purpose. It was the high point of his visit and the takeaway of the summit.
For India, the meeting of minds of the two heads of governments brought a lot of promises for the investment-starved country and its people. The deck is cleared for the US energy giants such as GE, Westinghouse and Hitichi (US-registered Japanese nuclear reactor maker) to invest billions in India in nuclear power plants in the west and east coast although there is a possibility that they could demand more. At the CEOs meet, India has promised every possible assistance to US companies to ensure the ease of doing business in the country. India is hoping for a large investment from US military equipment manufacturers in its defence production. India has virtually promised 25 per cent return on US investment in its electronics sector. That’s big bait for any foreign investor to ignore. India has promised that the progress of US investment proposals will be monitored by the Prime Minister’s Office (PMO), a very strong though highly unusual step, indirectly admitting the country’s notorious bureaucratic barricades to development. Ironically, the US offered $1 billion aid to India to import ‘Made-in-USA’ products.
Yet, promises are promises, however good, attractive and sincere they may sound. It takes time before they are translated into performance stage. It may not be within weeks or months that US companies will rush to the country to set up projects. But, what is discomforting is the pain the summit declaration has already started causing to India by way of powerful neighbor China’s reaction to the US roping-in of India for pivotal strategic support in its China and South China Sea maritime policy. The Chinese ‘outsider interference’ jibe against meddling in its maritime freedom can’t be taken too lightly. China has also threatened to invoke a hitherto neglected issue of India’s signing of the nuclear non-proliferation treaty (NPT) for its acceptance of India as a member of the nuclear suppliers group (NSG). Although Russia is yet to react to President Obama’s highly provocative remarks against the country and President Vladimir Putin, by name, for their alleged involvement in the latest round of Ukraine separatists’ arms struggle at the Obama-Modi joint press meet on the summit declaration, India’s time-tested friend must be extremely unhappy over the development. Unlike China, Putin was clever not to embarrass India with a counter statement.
Now that the euphoria over the Obama visit is over, India has to do a lot to ensure that US nuclear, defence and electronics manufacturing firms move in to the country within the next six months to set up projects in respective areas and participate in proposed smart city projects. Globally, the US is known to be a very demanding ally and a hard bargainer. The latest summit results merely confirm the masterly US bargaining art to squeeze out concessions while surrendering little. India’s request for higher job visa quota for its professionals has been patiently heard but not quite positively responded. The US is already asking for more patent protection for its industry that may put several of its industries, including pharmaceautical and devices, into distress. The US has also been pressing for a change in the FDI policy and trade restrictions in India’s e-commerce, organized retail trade and agriculture to promote its business interest in these areas.
Now that the prime minister has offered full support and cooperation to US firms seeking to invest in India, it is to be seen if India is ready to blink beyond the summit statement to accommodate other such US demands, having far reaching impact on India’s economy and its vision to emerge as a strong economic power with independent production and delivery capability similar to that of China. If those US demands did not figure very prominently in the summit round of Indo-US trade and economic dialogue, it could be because the US administration wanted to go cautiously, step by step. Nuclear and defence were given top priority at the summit talks since they are also India’s priority areas. Russia has been deeply entrenched in India’s defence and muclear production. The US does not want to lose out the business opportunity in the vast market with India already emerging as the world’s No.1 military equipment importer and having the world’s most ambitious power generation programme.
On India’s international relations, the summit statement and what may have been privately discussed between President Obama and Prime Minister Modi may call for a total re-look at India’s so-called independent, less-committal foreign policy regime to be more aligned and get closer to the USA without surrendering its current China and Russia policies. Suffice it to say, diplomatically, India has been pushed to a more tight rope walk through the Russia-China-USA triangle after the latest summit declaration. Its foreign policy framework must not unsettle the balance and erode the trust between India and each of the three nations. This could be the biggest challenge the just concluded India-USA summit has thrown up for the BJP-led Government. (IPA)
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