Namaste Trump: Indo-US Strategic Partnership

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After months of backroom negotiations and talks US President Donald Trump finally confirmed that he and first lady Melania Trump will visit India on a two-day state visit from 24th to 25th February 2020. The visit will begin with American president landing in Ahmedabad where he and Prime Minister Narendra Modi would inaugurate the world’s largest newly built Motera Cricket stadium that can hold up to 1,25,000 people. President Trump and Prime Minister Modi will also jointly grace an event named ‘Namaste Trump’, the Indian version of ‘Howdy Modi’ in honour of the American president. The event will host various India CEO, cricketers and American Indian businessman which American President Donald Trump would try to connect with as he heads into an election year back home. After Motera, President Trump and First Lady Melania Trump will head to Agra to visit Taj Mahal.

The bi-lateral discussion and talks between both sides will happen next day at Hyderabad House in New Delhi followed by the Presidential Dinner. President Trump’s visit to India is a significant step forward in the strategic partnership between India and United States. We have written extensively on Indo-US Strategic Partnership in our 2016 book The New Global Order. Indo-US strategic partnership is multi-faceted with Defense, Trade, Space & Counter Terrorism being important components. The defense partnership between India and US has grown substantially over the last six years with both concluding several pacts like LEMOA, COMCASA, DTTI and the just signed ISA (Industrial Security Annex) at the 2+2 ministerial dialogue on 19th December 2019. The Industrial Security Annex provides a framework or exchange and protection of classified military information between India and American defense industry enhancing greater military collaboration between two countries.

The two sides are also in the midst of negotiating BECA relating to sharing of Geo Spatial data. India is also likely to sign defence deals worth 2.6 billion dollar for 24 MH-60R Sea Hawk helicopters for Indian Navy along with radars and hellfire missiles. This is in addition to the already acquired Chinooks and Apache Military transport and combat choppers which have been inducted in Indian Airforce. India’s CCS recently cleared the acquisition of 24 multi-mission Romeo naval helicopters from USA for $2.12 billion and 6 more Apaches for $796 million. The Pentagon has also offered its NASAM II – Anti Ballistic Missile Shield armed with AMRAAM missiles to protect capital New Delhi from any missile or air attacks for $1.6 billion. The Indo-US defense partnership has grown to about $17 billion since 2007 pipping Russia as India’s largest arms supplier.

Indo-US Defense Partnership is also strategic to Indo-Pacific region. India was part of the Asian ‘QUAD’ foreign minister(s) meeting of US, Japan, Australia and India on sidelines of UNGA in September 2019 with a follow up meeting in November 2019 on the sidelines of ASEAN Summit where the four QUAD countries broadly agreed on Strategic vision for free of navigation in Indo Pacific and having a rule based order in the region largely aimed at containing the growing influence of China. India is also contemplating inviting Australia to Malabar military exercises along with Japan and US. The QUAD strategic alliance has revived after hiatus of a decade and with time it could transform into a security cum military alliance.

While the defense component of Indo-US Strategic Partnership has seen huge growth under the Modi Trump Era, the Trade component which has seen some wrangling and disagreements between two sides. India and US have been at loggerheads on Trade issues for quite some time with US imposing Steel, Aluminum Tariffs; withdrawing GSP benefits and suing India at WTO on Solar technology, agro products etc. On the other hand, Indian Government has taken an equally nationalistic approach by raising tariffs on American goods, adopting a firm stand on Data Localization issues, medical and IPR related issues which have become a point of tussle during the trade negotiations. However given the importance of Indo-US Strategic partnership, both sides have been negotiating a mini trade deal which could be ironed out during President Trump’s upcoming visit to India. While India has agreed to roll back tariffs on American goods like cashew nuts, almonds, medical equipment’s like stents, Harley Davidson among other things the American side has in principle agreed to reinstating the GSP trading preference to India while reconsidering some of its tariffs. India’s cabinet has also agreed to sign a MoU with USA on 18th February marking an initial pact on IPR rights.

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However, there are some sticking points in concluding of the mini trade deal like Agricultural & dairy market access that remain. The American side wants access to Poultry and Dairy Market for American products which India is hesitant to as it will lead to a flood of American products and the destruction of Indian Agro Food and Processing sector. India has strict laws about food fed to dairy cattle due to religious reasons and this further complicates the issue. Apart from this, American corporates have been agitating about Data Localization rules and policy imposed by RBI whereby it is mandatory for any Fintech industry operating in India to store and process the data locally for transactions relating to Indian jurisdiction. This has also drawn fire from American tech giants like Google, Facebook, Amazon etc. The recently introduced Data Protection Bill 2019 tries to allay many of these concerns pointing out a middle strategy where as per the draft bill, only critical personal data needs to be stored and processed locally in India and sensitive personal data can be stored abroad and processed based upon the fulfillment of certain conditions given that such data sharing will be part of the mandate of law enforcement agencies as and when needed.

It can thus be said that Indo-US Strategic partnership contains broad ambit of defense and military component, trade and economic component, collaboration in space sciences and counter terrorism efforts in the region. President Trump’s visit to India has great significance as it is a standalone state visit de-hyphenating Pakistan and comes at a time when US is on the cusp of signing a peace deal with Taliban in Afghanistan which will have great impact on security dynamics in the region given India has heavily invested in the Afghanistan over the past decades. In this light it is noteworthy that while American and Iranian tensions escalated after the killing of General Soleimani, the Americans underwrote a written assurance to India for Chabahar Port in Iran that is a critical link for India to Afghanistan and Central Asia. President Trump’s visit to India also comes in the backdrop of China grappling to combat outbreak of Novel Coronavirus and a struggling global economy. The upcoming state visit of President Donald Trump offers a renewed pitch for a more robust strategic partnership between the two countries to enable them to fight global challenges together and provide an island of stability and strength amid chaos that has been reigning across the regions globally. The leaders of the world’s largest democracy and oldest democracy can create a game changing partnership showcasing the strength of the democratic model of governance upholding free markets, free societies if both are willing to completely let bygones be bygones.

Notes:

  • India and USA conclude several landmark agreements in 2+2 Ministerial Dialogue https://economictimes.indiatimes.com/news/politics-and-nation/india-and-usa-conclude-several-landmark-agreements-in-22-ministerial-dialogue/articleshow/72892719.cms
  • Ahead of US President Donald Trump’s February 24 visit, India readies $2.6 billion chopper deal for Navy https://www.timesnownews.com/india/article/ahead-of-us-president-donald-trumps-february-24-visit-india-readies-2-6-billion-chopper-deal-for-navy/551902
  • Missile shield over Delhi: India may buy NASAMS-II air defence system from US https://timesofindia.indiatimes.com/india/missile-shield-over-delhi-india-may-buy-nasams-ii-air-defence-system-from-us/articleshow/74071029.cms
  • US, India, Australia, Japan ‘Quad’ Holds Senior Officials Meeting in Bangkok https://thediplomat.com/2019/11/us-india-australia-japan-quad-holds-senior-officials-meeting-in-bangkok/
  • India may invite Australia for Malabar naval exercise with US & Japan https://timesofindia.indiatimes.com/india/india-planning-to-invite-australia-for-malabar-naval-exercise/articleshow/73715057.cms
  • India, US unlikely to clinch mini trade deal during Donald Trump’s visit https://timesofindia.indiatimes.com/business/india-business/india-us-unlikely-to-clinch-mini-trade-deal-during-donald-trumps-visit/articleshow/74166488.cms
  • Duty relief proposed for Harley motorcycles ahead of Trump visit https://economictimes.indiatimes.com/news/economy/foreign-trade/duty-relief-proposed-for-harley-motorcycles-ahead-of-trump-visit/articleshow/74143989.cms?from=mdr
  • No talks on opening up poultry and dairy markets to US companies: Govt https://www.business-standard.com/article/economy-policy/no-talks-on-opening-up-poultry-and-dairy-markets-to-us-companies-govt-120021401850_1.html
  • Changes likely in proposed data privacy rules: Only critical data may need to be housed in India https://economictimes.indiatimes.com/tech/internet/changes-likely-in-proposed-data-privacy-rules-only-critical-data-may-need-to-be-housed-in-india/articleshow/70355298.cms?from=mdr

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