US-India Relations to Continue Its Upward Trajectory Under The Obama Administration

Relations between the United States and India have grown progressively closer following the collapse of the Soviet Union, India’s former major trade and military partner. President Clinton’s historic visit to India in 2000 gave the emerging relationship new impetus, and under President George W. Bush, the two allies became economic and military partners. But what are the prospects for the relationship under President Barack Obama? Along with hopes, there are some looming concerns.

Amid a mixture of hope and aspirations for the new US administration, many Indians believe relations reached their high point last year when President George W. Bush sealed a landmark nuclear deal with India that revolutionized ties between the world’s largest democracies.
Despite a diminished image around the world, Bush was very popular in India. His administration saw India as the predominant power in South Asia, and with that encouragement India viewed itself as an emerging global player and close military partner with the United States. The giddiness of this self-image even prompted one official from the ruling Congress party to propose that India bestow Bush with the nation's highest civilian honor. But the love affair India had with President Bush will not automatically translate to Barack Obama.

The new US administration has made it clear its foreign policy priority right now is Afghanistan. And to make headway there, it needs help from India’s long-time rival, Pakistan. Washington needs a stable and cooperative government in Islamabad in dealing with al-Qaida and Taleban insurgents in Afghanistan who take refuge across the border inside Pakistan’s North West Frontier Province. Washington needs India’s help, too, but in a less direct way. It simply wants New Delhi to keep its long-held animosity toward Pakistan in check. That less-than-active and seemingly secondary role leaves some Indians nostalgic for the Bush years.  

In Washington, however, there is the expectation that U.S.- India relations will remain on the same path. Johns Hopkins University professor Walter Anderson says there are a number of objective facts that dictate a steady U.S. policy in the region.

“First, this is an area where most of the world’s oil and gas resources are located, that is, the Persian Gulf area, and the critical sea lanes that lead out from that carry them in tankers. India plays a critical role, geo-strategically, in protecting those sea-lanes,” says Mr. Andersen. 

“Second is that the area from East Africa around to Indonesia is largely very unstable, and the one stable country in this region of great importance to the United States is India and it is a democracy. Thirdly, India is a robust economy. Even though the world is now in something of an economic downturn, apparently it is not affecting India as much. Moreover, India has great potential for rebounding from this situation. Some analysts predict that it may be the third or fourth largest economy within about two or three decades. So for all those reasons, objective facts, I think much of the present policies of (the US) deepening the relationship with India will continue.”

President Obama’s special envoy Richard Holbrooke was recently in South Asia. In order to keep the war on terrorism front and center in the region, Holbrooke was to talk with both India and Pakistan about Kashmir, the common border region over which they have fought two wars and still maintain a tenuous truce. Any hostilities between the two US allies would take the focus off Afghanistan. India apparently convinced Washington that bringing up Kashmir would detrimental to the US goal. But that doesn’t mean India disagrees with the war on terrorism.

In fact, Mahendra Ved, a South Asia expert and seasoned journalist, says containing terrorism is in India’s interest as well.

“India would expect that President Obama stay focused. His administration is moving out of Iraq so fast, and focusing on Afghanistan, focusing on Pakistan-Afghanistan border, focusing on Al-Qaeda and Taliban, a whole lot of people that have created problems for the whole world. If this is the focus, then Indians find it increasingly reassuring.”  

One thing India does not find reassuring is an economic issue that puts the two allies at odds – outsourcing. President Obama, facing more than three million Americans who have recently lost their jobs, is promising to eliminate tax incentives for US companies who take jobs overseas. 

Such a move would cast a huge shadow over the outsourcing industry, which has become one of the fastest-growing sectors of India’s economy. Again, Walter Andersen. “Yes, it is a real concern, and much of the press that deals with international trade has been voicing that concern,” he said. “I am not sure how the Administration actually moves in that area, but it is something to pay attention to because protectionism is a possibility and there have been suggestions that the US should do that. I think it will be very counterproductive. I think it will be a mistake, and yes, some Indian industries would suffer the consequence.”

South Asian expert Mahendra Ved says outsourcing is beneficial to both countries. “I think it is more than established that the outsourcing is to mutual advantage to both American and Indian economies.”  

Not everyone in the United States agrees, including many of the more than 2.5 million Indian Americans. Jagdish Jassal, a retired official of the World Bank, says outsourcing should take place only after the jobs of Americans are secured.

“I don’t think it is any protectionism because the need arises because of United States’ own problems. They have lost about four million jobs. It is hurting Americans. And an American president or American administration has to take care of its own citizens first,” says Mr. Jassal. “The Indians cannot blame the US for it. If Indians were in the same situation, what would they do? Indians wouldn’t like to outsource their own jobs overseas. First claim on these jobs here (in America) is of US taxpayers.”

One source of hope for US-Indian relations is the new U.S. Secretary of State, Hillary Clinton. Well-known in India, Clinton served as co-chair of the India caucus in the U.S. Senate. Former Indian Foreign Secretary Shyam Saran says Hillary Clinton gives Indians high hopes for future cooperation. "Having someone in that influential position who has a certain knowledge, and I would say even a certain sympathy for India, this can only be a plus point."

“It was under Mrs. Clinton’s husband that relations between the United States and India began to flower. It was accelerated under President George W. Bush and is now set to continue its upward trajectory.” That hopeful assessment of US-Indian relations came in testimony given by Karl Inderfurth before the US Congress last week.

A former Assistant Secretary of State for South Asia, Ambassador Inderfurth called upon both nations to “dream big.” By establishing visionary goals that build on common strengths in science, pharmaceuticals, public health, agriculture and more, Inderfurth said there are no limits to what India and the United States can accomplish together in the 21st Century.

This report was written by Subhash Vohra and voiced by Steve Ember

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