A red carpet for India

It was ironic for the White House to condemn cross-border terrorism in the context of Pakistan-India relations while playing host to the man who as chief minister masterminded the 2004 carnage of Muslims in the Indian state of Gujarat and who presides over a government which treats its own citizens with abandon.

But an irony, however conspicuous, doesn’t rest on the law of non-contradiction, which means that nations and people can in a particular situation conveniently choose to set aside the norms which they so fervently champion otherwise. Pragmatists have the incorrigible habit of trumping principles at will and Americans are deeply steeped into pragmatic ethos.

The joint statement issued at the conclusion of Indian Prime Minister Narendra Modi’s recent visit to Washington, which describes the two countries as ‘among the closest partners in the world’ and their partnership as unique, ‘which spans the seas to the stars,’ is not unprecedented in its tone or tenor. It has become customary for Washington to use the most complimentary of terms to characterize its relations with New Delhi. In 2010, while in India when the Congress Party, and not the incumbent ruling party, was at the helm, former US president Barack Obama had termed the Indian-American relationship one of this century’s ‘defining partnerships’. Such statements sum up the high significance that the Americans attach to their ‘Comprehensive Global and Strategic Partnership’ with Indians.

It's easy to draw a parallel between the two nations: they are two of the world's largest democracies; both are multiethnic societies, stable polities, nuclear powers and massive market economies; both are key players on the multilateral scene; one is a permanent member of the United Nations Security Council (UNSC), while the other aspires to be in the coveted club. Washington has been supportive of New Delhi’s UNSC membership, which was reiterated during Modi’s recent visit and duly reflected in the joint statement. The US has been a world power since long, while India has the ambition to become one. The US has been uneasy, if not apprehensive, over the rise of China, that is why India is being supported by it.

Not surprisingly, India-US relations have come a long way from the mistrust of the cold-war era to the present strategic partnership. It was former president Bush who accepted India as a nuclear power when he sealed a nuclear cooperation deal with that country in 2008.

India-US relations have both political and economic dimensions. The US wants to preserve the existing global order based on liberalism. America realizes that, although it is the lone superpower, it cannot control world affairs independently. It needs regional partners or allies, particularly those believing in economic and political liberalism (Japan and South Korea in East Asia, India in South Asia, Australia in the Pacific), to control the world.

The political expression of liberalism is democracy, while its economic expression is the free-market economy. Democracy is advocated mainly because it is useful for promoting American interests as autocratic regimes are more likely to breed extremism and terrorism – at present the most potent threat to the US-dominated global order – than representative ones.

By the same token, a free-market economy is advocated because it best suits American companies engaged in international business. Promoting the political interests of the US government and the economic interests of the domestic firms is the pivot on which American foreign policy revolves. And India, given its political and economic credentials, finely fits into this scheme.

India-US economic and commercial relations are growing. Merchandise trade between the two countries has gone up from $35 billion in 2009 to $138 billion in 2022 including $47 billion in exports from the US and $91 billion in exports from India. This gives India a trade surplus of $44 billion – the country's largest with any country.

For India, the US is the single largest export market and the third largest source of imports following China and the UAE. In addition, trade in services between the two countries has gone at a gallop in recent years reaching $48 billion including $29 billion in exports from India and $19 billion in exports from the US. The latter is also one of the top sources of FDI into India; the inflows went up from a meagre $478 million in FY2013 to the peak of $13.8 billion in FY21 before falling to $10.5 billion in FY22 and $6 billion in FY23 mainly because of Covid.

The high-tech industry has emerged as the most prominent area in bilateral economic cooperation. Four of the largest high-tech US-based multinational enterprises (MNEs) – Google, Microsoft, Apple, and Amazon – are present in India. while the electric vehicle giant Tesla, has indicated to invest in India. The seminal feature of Google’s investment in India is the $10 billion India Digitization Fund. In January this year, the two countries launched the Initiative on Critical and Emerging Technology as part of efforts to bolster collaboration in high-tech industries.

In a significant development, Micron Technology has announced plans to build a semiconductor factory in India through a $2.75 billion joint venture. Semiconductors have emerged as the key strategic industry for both advanced and emerging economies. The envisaged investment needs to be seen in the backdrop of Washington’s efforts to throttle the development of the semiconductor industry in China by blocking the supply of vital components and technology to Chinese enterprises. Such efforts, if successful, may strike the heaviest blow to China’s long-term development.

Seen in a larger context, it is US recent policies and initiatives in the Indo-Pacific region in which India is supposed to play an important role, that lend the strongest credence to the view that Washington is propping up New Delhi as a counterweight to Beijing. India together with the US, Japan and Australia (the four ‘maritime democracies’) is a member of the Quad.

The arrangement aims at promoting a peaceful, open, democratic and inclusive Indo-Pacific that is ‘free from undue influence and coercion.’ However, seen from another perspective, it is an attempt to encircle Beijing on the part of Washington as two of the other three members are China’s neighbours. All the Quad members are also part of the recently launched Indo-Pacific Economic Framework for Prosperity, which many see as an attempt to contain the rise of China.

With India-American relations having such a broad scope and such high stakes, the remarks pertaining to Pakistan in the joint statement were evidently made to please Modi. Indians will go the polls in less than a year. The economic achievements of the BJP government aside, Pakistan bashing is seen as essential by Modi and the ruling party to consolidate their electoral prospects. For Modi, of course, the joint statement and the red-carpet treatment that was accorded to him was what the doctor ordered. It has also nullified any points that opposition leader Rahul Gandhi might have scored during his visit to the US a few weeks before Modi’s. That said, it would be incorrect to assume that the joint statement would have been any different in substance had the Indian delegation been led by Gandhi or any other leader. It’s the inter-state, not inter-personal, relations that count.

Islamabad has been walking a tightrope in its attempts to even out its relations with Washington and Beijing. The US is Pakistan’s largest export market. From time to time, American support is needed to get a green signal from multilateral institutions, such as the IMF and Financial Action Task Force. On the other hand, China is Pakistan’s largest trading partner and the largest source of FDI. The China-Pakistan Economic Corridor is vital to the country’s infrastructure and industrial development. Washington’s ever warming relations with New Delhi are likely to induce Islamabad to tilt towards Beijing, which on its part is keeping its eyes skinned on such developments.

A glaring contrast between Pakistan and India, which Modi’s visit has made even clearer, is regarding the respective expatriates. It would be a matter of immense pride for any leader to sit in a foreign land with their countrymen or women occupying top slots in the institutions and enterprises that are the driver of the global economy. By contrast, Pakistani leaders are often jeered at by the diaspora during their foreign visits or stay, thus impairing whatever positive image the country has.

The writer is an Islamabad-based columnist. He tweets @hussainhzaidi and can be reached at: hussainhzaidi@ gmail.com