India-U.S. Relations Overview

Context: This topic is important for UPSE GS Paper2.

 India-U.S. bilateral relations have developed into a "global strategic partnership", based on shared democratic values and increasing convergence of interests on bilateral, regional and global issues.

The cooperation is based on the idea of “ChaleinSaathSaath: Forward Together We Go”, and "SanjhaPrayas, Sab ka Vikas" (Shared Effort, Progress for All).

Today, the India-U.S. bilateral cooperation is broad-based and multi-sectoral, covering trade and investment, defence and security, education, science and technology, cyber security, high-technology, civil nuclear energy, space technology and applications, clean energy, environment, agriculture and health. Vibrant people-to-people interaction and support across the political spectrum in both countries nurture our bilateral relationship.

 Political Relations:

• The frequency of high-level visits and exchanges between India and the U.S. has gone up.
• During the visit by President Obama to India in January 2015 as the Chief Guest on India's Republic Day, the two sides issued a Delhi Declaration of Friendship and adopted a Joint Strategic Vision for Asia-Pacific and the Indian Ocean Region.
•  Both sides elevated the Strategic Dialogue between their Foreign Ministers to the Strategic and Commercial Dialogue of Foreign and Commerce Ministers.
• India also has a 2+2 dialogue with the U.S.A.

 Civil Nuclear Cooperation:

• The bilateral civil nuclear cooperation agreement was finalized in July 2007 and signed in October 2008.
• In September 2014, the two sides set up a Contact Group for advancing the full and timely implementation of the India-U.S. Civil Nuclear Cooperation Agreement, and to resolve pending issues.

• The two sides have started the preparatory work on site in India for six AP 1000 reactors to be built by Westinghouse. Once completed, the project would be among the largest of its kind.

Defence Cooperation:

• The defence relationship has emerged as a major pillar of India-U.S. strategic partnership with the signing of the ‘New Framework for India-U.S. Defence Relations’ in 2005 and the resulting intensification in defence trade, joint exercises, personnel exchanges, collaboration and cooperation in maritime security and counter-piracy, and exchanges between each of the three services.
• USA recognised India as a ‘Major Defence Partner, which places India on par with its NATO allies.
• India has also signed three defence agreements with USA which will enable the export of sensitive equipments to India;

LEMOA (Logistic Exchange Memorandum of Agreement) signed in 2016

COMCASA (Communications Compatibility and Security Agreement) was signed in 2018 and

BECA (Basic Exchange and Cooperation Agreement) was signed in 2020.

• India has signed a deal for buying defence supplies worth almost 18 billion dollars from the US and another three billion dollars worth of defence supplies in the pipeline
• USA has emerged as one of the largest suppliers of arms and defence technologies to India such as Apache Attack Helicopter, Chinook Helicopter, C-17 Globe Master (heavy lift transport aircraft),  C-130J transport aircraft, Predator B drones, NASAMS-2 ( a missile shield meant to protect vital installations), ISTAR aircraft (meant to detect targets on the ground), F21 fighter aircraft etc
• The two countries regularly conduct bilateral exercises such as Yudha Abhyas, Red Flag etc.
• India also participated in the Rim of the Pacific (RIMPAC) exercise with the USA.

Counter-terrorism and internal security:

• USA declared Pakistan as a “safe haven” for terrorists and flaked the country for not doing enough for controlling the menace of terrorism
• USA declared Hizbul Mujahideen chief Syed Salahuddin, a global terrorist.

• The United States supports a reformed UN Security Council that includes India as a permanent member

• India-U.S. Counter-Terrorism Cooperation Initiative was signed in 2010 to expand collaboration on counter-terrorism, information sharing and capacity building.
•  A Homeland Security Dialogue was announced during President Obama's visit to India in November 2010 to further deepen operational cooperation, counter-terrorism technology transfers and capacity building.

• In order to further enhance the counter terrorism cooperation between India and the U.S., an arrangement was concluded in June 2016 to facilitate the exchange of terrorist screening information through the designated contact points.

Trade and Economic:

• The US remained India's top trading partner for the second consecutive fiscal in 2019-20, which shows increasing economic ties between the two countries.
• According to the data of the commerce ministry, in 2019-20, the bilateral trade between the US and India stood at USD 88.75 billion as against USD 87.96 billion in 2018-19.
• The US is one of the few countries with which India has a trade surplus.
• In 2018-19, the US first surpassed China to become India's top trading partner.
• India is sixth largest supplier of service imports to the USA. The IT sector in India contributes to almost 9% of the country’s GDP, and the bulk of India’s production is exported to the US.
• India also receives the Second largest Investment (after Singapore) from US investors worth 14 billion Indian Rupees.
• U.S.-India Infrastructure Collaboration Platform has also been set up to deploy cutting-edge U.S technologies to meet India’s infrastructure needs. U.S. firms will be lead partners in developing Allahabad, Ajmer and Vishakhapatnam as Smart Cities.
• USAID will serve as a knowledge partner for the Urban India Water, Sanitation and Hygiene (WASH) alliance to help leverage business and civil society (Gates Foundation) to facilitate access to clean water, hygiene and sanitation in 500 Indian cities.

Energy and Climate Change:

• The USA overtook Saudi Arabia as India’s second-biggest oil supplier after Iraq.
• Investment by Indian companies like Reliance, Essar and GAIL in the U.S. natural gas market is ushering in a new era of India-U.S. energy partnership.
• As a priority initiative under the PACE (Partnership to Advance Clean Energy, the Joint Clean Energy Research and Development Centre (JCERDC) was established to promote clean energy innovations by teams of scientists from India and the United States, with a total joint commitment funding from both Governments of US$ 50 million.

• A new U.S.-India Partnership for Climate Resilience has been agreed to, in order to advance capacity for climate adaptation planning, as also a new U.S.- India Climate Fellowship Program to build long-term capacity to address climate change-related issues.

Education:

• About 130,000 Indian students are pursuing advanced degrees in the U.S.
• Through the Higher Education Dialogue, India is learning from the U.S. experience in community colleges in order to meet our demands for skill development.
• Under the Global Initiative of Academic Networks (GIAN) launched by India, up to 1000 American academics will be invited and hosted each year to teach in Indian universities at their convenience.
• The two sides are also collaborating to establish a new Indian Institute of Technology in Ahmedabad.

Space:

• NASA and ISRO are collaborating for India's Mars Orbiter Mission and for a dual-band Synthetic Aperture Radar (NISAR).
• In June 2016, ISRO successfully launched record 20 satellites onboard a PSLV rocket, which included 13 satellites from the United States.

 Science & Technology (S&T):

• The U.S.-India Science & Technology Endowment Fund, established in 2009, under the Science and Technology Endowment Board promotes the commercialization of jointly developed innovative technologies with the potential for positive societal impact.
•  Collaboration between the Ministry of Earth Sciences and U.S. National Oceanographic and Atmospheric Administration has been strengthened under the 2008 MOU on Earth Observations and Earth Sciences.
• A "monsoon desk" has been established at the U.S. National Centers for Environmental Prediction.
•  India's contribution of $250 million towards the Thirty-Meter Telescope Project in Hawaii and
•  Indian Initiative in Gravitational Observations (IndiGO) with U.S. LIGO Laboratory are examples of joint collaboration to create world-class research facilities.

People to people ties:

• The 3.5-million-plus strong Indian American community is an important ethnic group in the U.S., accounting for about 1% of the total population in the country.
•  Indian American community includes a large number of professionals, business entrepreneurs and educationalists with increasing influence in society.
• With many Indian Americans occupying high-level posts example senator Kamala Harris, Ami Bera, RO Khanna (Democrats lawmakers from California)etc, the Indian Diaspora has assimilated into their adopted country and is acting as a catalyst to forge closer and stronger ties between India and the U.S..

Issues Between USA and India

• India is seeking relaxation in US visa regime, exemption from high duties imposed by the US on certain steel and aluminium products, and greater market access for its products from sectors such as agriculture, automobile, automobile components and engineering.
• On the other hand, the US wants greater market access for its farm and manufacturing products, dairy items, medical devices, and data localisation, apart from cutting on import duties on some information and communication technology, including Harley Davidson.
• CATSAA sanctions as per which India’s energy and defence deals with Iran and Russia are compromised.
•  India had lost the domestic content requirement (DCR) case related to the solar cell manufacturing against U.S.A. in the dispute settlement system of WTO.
•  Recently US 7th Fleet’s patrol in India’s Exclusive Economic Zone without prior information to India was another concern for India.
• India’s exclusion from the US’ Generalized System of Preference (GSP)
  • In 2019, President Donald Trump had terminated India’s designation as a beneficiary developing nation under the GSP trade program after determining that it has not assured the US that it will provide “equitable and reasonable access” to its markets.
  • India was the largest beneficiary of the program in 2017 with USD 5.7 billion in imports to the US given duty-free status.
  • GSP is designed to promote economic development by allowing duty-free entry for thousands of products from designated beneficiary countries.

Despite these issues, India US ties are expanding on various fronts visible in the form of cooperation in Indo -Pacific region ,QUAD grouping, Coalition For Disaster Resilience Infrastructure etc.

 Editorial- Trade and climate, the pivot for India-U.S. ties

The two areas are interrelated and will lend additional strength to the foundation of a true partnership

When the history of the 21st century is written, India and the United States and the strategic alliance they forge should play starring roles. Granted, it is far too early to predict how successful their joint efforts will be in creating a free and open Indo-Pacific — one that advances democratic values and confronts autocracies globally and locally.

As 2021 closes, with COVID-19 still a present danger and China, the emerging superpower on the global stage, viewed by both as a strategic competitor, India and the U.S. have a long way to go before they can inspire confidence that this blossoming alliance will endure for the long term.

Areas of convergence

• We believe that the fate of the grand strategic ambitions of the relationship may in fact depend substantially on how well they collaborate in two areas to which their joint attention is only belatedly turning — climate and trade.
• The first presents an existential threat while the second is too often dismissed as a secondary consideration, even dispensable in the name of pursuing larger strategic interests.
• Such thinking ignores the lessons of history: strategic partnerships capable of re-shaping the international global order cannot be based simply on a negative agenda.
• Shared concerns about China provide the U.S.-India partnership a much-needed impetus to overcome the awkward efforts for deeper collaboration that have characterised the past few decades.

Some encouraging signs

• There has been progress. The U.S. Special Presidential Envoy for Climate, John Kerry, has visited India twice already, and India and the U.S. are collaborating under the Climate and Clean Energy Agenda Partnership.
• In parallel, there are hopeful signs that they are now prioritising the bilateral trade relationship by rechartering the Trade Policy Forum.
• However, early signs suggest we might be headed for a replay of previous showdowns at COP26 in Glasgow: while India just announced a net zero goal for 2070 — a welcome development even if well after catastrophic climate scenarios may be baked in — it has called for western countries to commit to negative emissions targets.
• India’s rhetoric of climate justice is likely to be received poorly by U.S. negotiators, particularly if it aligns with China’s messaging and obstructs efforts to reach concrete results.
• Protectionist tendencies infect the politics of both countries these days, and, with a contentious U.S. mid-term election a year away, the political window for achieving problem-solving outcomes and setting a vision on trade for the future is closing fast.

The interlinks

• Climate and trade are interrelated in many ways, from commercial dissemination of cutting-edge carbon mitigation and adaptation products and technologies to the carbon emissions that come with the transport of goods and humans from one country to another.
• If governments, such as India and the U.S., coordinate policies to incentivise sharing of climate-related technologies and align approaches for reducing emissions associated with trade, the climate-trade inter-relationship can be a net positive one.

Work on early solutions

• For example, India and the U.S. could find opportunities to align their climate and trade approaches better, starting with a resolution of their disputes in the World Trade Organization (WTO) on solar panels.
• As they have dithered in pursuing cases in the WTO and settling them, China has effectively captured the global market, leaving each dependent on a source they view as a threat.
• The two countries could also chart a path that allows trade to flow for transitional energy sources, such as fuel ethanol.
• India currently bans imports of fuel ethanol even as it seeks to ramp up its own ethanol blend mandates and build a domestic sector that can join the U.S. and Brazil in exporting to the world.
• The most immediate threat could be the possibility of new climate and trade tensions were India to insist that technology is transferred in ways that undermine incentives for innovation in both countries or if the U.S. decides that imports from India be subject to increased tariffs in the form of carbon border adjustment mechanisms or “CBAMs”.
• Climate-inspired trade tensions that might even lead to new trade wars can hardly bolster the strategic partnership.

Way Forward

Concerted action on both the climate and trade fronts is mutually beneficial and will lend additional strength to the foundation of a true partnership for the coming century.