India, US Ties: A lot Will Depend On Washington Policies On Global Counter Terrorism


As Prime minister Narendra Modi walked in for the State Dinner hosted at the White House last month, the whole world keenly observed the relationship between the leaders of the two most important global economies of the world.

As true engines of economic and industrial growth, I believe that the India-US relationship will be critical to enhance bilateral trade and investment and to catalyse global growth. The positive energy from the first official meeting between president Donald Trump and prime minister Modi is highly encouraging, and indicative of a successful economic partnership that will be mutually beneficial, and indeed shape global trends for decades to come.

Two way trade between India and the US reached $114 billion in 2016, and with the Indian economy growing at over 7% annually, this number is expected to rise for the current year. India’s positive economic outlook and favorable demographics remain key attractions for advanced economies, whereas the import demands of the US act as a catalyst for growing economies. India also enjoys a favorable trade balance of $24.4 billion in goods with US and features among only 12 other countries with whom the US has a trade deficit (though marginal compared to ~$347 trade deficit with China).

While trade and investment relations will also be dependent on evolving immigration policies and technological cooperation in the long run, the two countries have already found synergies in terms of the energy outlook and their respective energy strategies.  PM Modi and president Trump have reaffirmed the continued importance of their Strategic Energy Partnership and of leveraging new opportunities to raise cooperation towards developing global energy security. India’s standing in the Energy Sector is rising globally, with investments in countries like Russia, Vietnam, Mozambique and South Sudan. As International Energy Agency (IEA) predicts, India will turn a global player in the energy market during the next 25 years and play a pivotal role in various aspects including renewable energy, energy efficiency and developing a balanced approach towards environment and climate policy.

The statement that the two countries will expand innovation linkages across the energy sector and deepen cooperation, including on more efficient fossil fuel technologies, smart grids, and energy storage, is a very welcome strategic move for India. The move is expected to bring in international financing of energy projects, including clean coal projects, with involvement of Multilateral Development Banks towards promoting universal access to affordable and reliable energy.

A conclusion of contractual agreements between Westinghouse Electric Company and the Nuclear Power Corporation of India for six nuclear reactors in India will not only boost the related ancillary opportunities but also bring in opportunities of employment and high level skilling. While increasing market access in areas like agriculture, information technology, manufactured goods and services can only evolve with time, defence ties have been strengthened to an unprecedented level. India’s increasingly global profile and deepening bilateral ties with countries like Afghanistan, UAE, Singapore, UK, Japan and others makes it a much more credible entity for US defence exports and technology transfer.

Strong Indo-US ties will definitely help India’s access to international forums and position itself meaningfully against or for initiatives like ‘One Belt One Road’, UN Comprehensive Convention on International Terrorism, Indian Ocean Naval Symposium, etc. India’s challenge to build up a strong counter-terrorism leadership across the world needs a strong ally like the US. While Indo-US relationship will depend on US openness to capacity building, technology transfers and immigration policies, a lot will also depend on Washington’s policies on global counter terrorism and its willingness to a whole hearted embrace of India’s emergence as a global economic powerhouse.

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