India-US Relations: A Partnership Of Trust Will Inform The ‘Techade’ Ahead – Analysis


Suspicion to hostility, grievances of the past to the futures of tomorrow, it has taken the United States (US) and India three-quarters of a century to build a robust economic-strategic relationship. What could have, and should have, begun in 1947 is happening in 2023.

From visas and semiconductors to aircraft engines and space exploration, more than the number it is the textures of deals, economically sensitive and strategically critical, that have come together in a grand climax of slowly-rising mutual confidence between the world’s two largest democracies. These coincide as the US de-risks itself from China and seeks a partner with scale and trust.

“A partnership that is among the most consequential in the world, that is stronger, closer, and more dynamic than any time in history,” is how the US President Joe Biden defined the India-US relationship. “Together, we’re unlocking a shared future of what I believe to be unlimited potential.” In addition to rising trade, Biden talked about doubling down on semiconductor supply chains, strengthening the “major defence partnership,” including the Quad, and advancing open RAN telecommunications network, a critical technology for 5G, 6G, and beyond rollouts. With the US elections coming up in November 2024, he packaged the 200 Boeing aircraft being purchased by Air India as a deal that will create one million jobs in the US.

On his part, Prime Minister Narendra Modi dug deep and understood the importance of other stakeholders contributing this economic-strategic intent—businesses. “We both agree that to make a strategic technology partnership meaningful, it is very important that governments, businesses, and academic institutions come together,” he said. “By increasing our cooperation in fields such as artificial intelligence, semiconductors, space, quantum, and telecom, we are creating a strong and futuristic partnership. The decision taken by American companies such as Micron, Google, and Applied Materials to invest in India symbolises this futuristic partnership.”

Of the three stakeholders that Modi mentioned, two are on course. One, the G2G (government to government) relationship, which has been on a steadily rising course has been further strengthened. And two, the B2B (business to business) relationship; for instance, GE Aerospace signing an MoU with Hindustan Aeronautics to produce fighter jets for the Indian Air Force, even as Elon Musk’s Tesla-SpaceX get ready to enter. What remains to be fixed is the relationship of academic institutions, with mainstream media in tow, both of which have been captured by and infested with an anti-India and anti-Hindu rhetoric, unbecoming of their unbiased mandates. Of course, in the larger scheme of things, they remain on the fringes of attention and action in both countries.

The India-US relationship that had been on a strategic drift between 1947 and 1991 has been built serially and continually, across three major milestones, each punching above its weight. First, the opening up the economy to foreign investment and products in 1991 under Prime Minister Narasimha Rao. The expectations from Washington that the Indian economy would deliver new markets for US firms did not materialise as quickly as imagined. It took sixteen years for the Indian economy to yield results, as it rose from US$270 billion in 1991 to US$1.2 trillion in 2007, a size that offered scale.

Second, the India-US civil nuclear deal in 2005 under Prime Minister Manmohan Singh. This was a turning point in the India-US relationship and, again, raised exponential hopes. Around this time, India had become a major buyer of aircraft, from the US’s Boeing and France’s Airbus. Defence deals were still two elections away.

Both, the economic reforms of 1991 and the strategic deal of 2005, have culminated in the hands of Prime Minister Narendra Modi and US President Joe Biden into an economic-strategic embrace that looks at the next ten years—“techade”—with hope and harmony. Between these milestones of India-US relationship stand the four million people of Indian origin, who despite being one percent of the population contribute to six percent in taxes, and more than 700,000 US citizens living in India who have brought capital and skills.

The peaceful and contributory Indian diaspora has generated a huge goodwill, that has been largely served and leveraged by both the leaders. Citizens of Indian origin are heading some of the top US companies, from Google and Microsoft to Novartis and Micron. The US remains the destination of choice as far as education goes, with 125,000 student visas being expanded. India remains the geography of growth, and with a little tinkering of its regulatory structures, could attract corporate refugees from China.

A transfer of gaze is underway, in both India and the US, that is shifting stance from suspicion and hostility to trust and warmth. It is a realisation that in the hard spaces of economics and strategy, the two democracies are natural partners. It is an understanding that in the soft spaces of values and interests, the two democracies will continue to converge. It is an appreciation of the real motives of China, now out in the open, that has made both the democracies realise that open and liberal societies need to work together. It is a comprehension that this is a relationship that brings two core troikas of business-defence-technology and jobs-taxes-prosperity together through the people of the two democracies.

*About the author: Gautam Chikermane is a Vice President at ORF. His areas of research are economics, politics and foreign policy.

Source: This article was published by the Observer Research Foundation

Observer Research Foundation

ORF was established on 5 September 1990 as a private, not for profit, ’think tank’ to influence public policy formulation. The Foundation brought together, for the first time, leading Indian economists and policymakers to present An Agenda for Economic Reforms in India. The idea was to help develop a consensus in favour of economic reforms.

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