India-US: A journey from difficult to normal

India-US: A journey from difficult to normal
India-US: A journey from difficult to normal

Mukesh Aghi is president of the US-India Business Council (USIBC), an influential bilateral agency focused on developing the strategic partnership between India and the US. Dr Aghi is perfectly placed to assess how far this partnership has strengthened, what the Indian Prime Minister can hope to take back from his upcoming American tour this time and what the post-Obama landscape could look like for India-US ties. Have India-US relations progressed significantly in the Modi-Obama era

We would have had a very different conversation about two years back. Many have suggested that the US-India bilateral relations have moved from “difficult” to a “normal” period. This turn in relationship, or rather the change in the tone and departure from the past stems from the historic and visionary joint statement signed by President Obama and Prime Minister Modi during the former's visit to New Delhi in 2015. Since then, several bilateral meetings have taken place with an emphasis on cybersecurity, climate change and defense cooperation. In fact, the US holds more official dialogues with India than with any other country. So yes, the relations are on the right trajectory and have acquired momentum. This has also been supported by a strong set of domestic reforms since Prime Minister Modi assumed office. These include accelerated infrastructure investment; greater openness to foreign direct investment; more effective administration; consolidation and recapitalisation of public sector banks; a proper bankruptcy code; delivery of public assistance by means of the system of unique identification numbers; talks on the Goods and Service Tax (GST) Bill are back on the table. What is the Indian PM likely to take back from his US visit this time As we know, Prime Minister Modi's vision for India's growth is spurred by innovation, entrepreneurship, the renewable energy industry and digitization. He believes that the United States could serve as a strong partner to help achieve these goals together. His top takeaways from this trip will likely focus on strengthening this partnership in three specific ways. One, build a relationship of increased trust and friendship; two, pivot this partnership forward by attracting further investment by offering a more transparent, predictable business environment in India; and finally, leave a message for US Congress, political leadership, and business community of his serious and impactful initiatives such as Make in India and Digital India, which - as time goes by - will translate into solid economic reform. Are agreements in fields such as defence likely to progress The defence trade between the two countries has grown from a mere $200 million in 2000 to nearly $14 billion today. India and the US are more aligned than ever before on matters of defence cooperation, homeland security, joint training and cybersecurity - so it has already progressed. The recent introduction of the US-India Defense Cooperation in the US Senate and its companion bill in the US House of Representatives elevates India as an important partner that can uphold security in Asia and around the world. The reason behind these developments is clear - Prime Minister Modi's political platform tilts toward the United States as a natural partner in the context of defense and security in a way that previous governments have not. He has made Make in India a centerpiece of his policy agenda, and building India's defense industrial base is central to this effort. India will need greater and higher investment to update its military and American defence firms are especially well-suited to this task. What is your view on India′s stand against the US on WTO treaties The US and India have been closely cooperating on trade, including on the recent passage and ratification of the WTO Trade Facilitation Agreement, which will have benefits for Indian and U.S. companies. Sure, our trade economies have their differences from time-to-time, but our ability to work through these trade disputes and not let it derail the progress we are making on a host of other issues is what demonstrates that our relationship remains stronger than ever. We look forward to working with both the US and Indian negotiators to further trade reforms including India's membership in APEC and concluding a high-standard Bilateral Investment Treaty. What are some of the sectors/deals that stand out in terms of Indian expansion in the US in recent times The US is the world's largest recipient of FDI, and India is one of the fastest-growing sources of FDI in the US, at nearly $11 billion. Indian-owned firms in the US employ around 44,000 workers, and these firms contribute more than $2 billion to US exports. There is solid interest by Indian investors in the power, steel, pharmaceutical and knowledge industries. This inflow of capital will expand the US economy across a wide variety of fields, creating jobs and bolstering economic growth in both countries. What has been your personal highlight during your USIBC presidency The biggest and most recent highlight has been the Council's heightened engagement on the legislative side with the US Congress. An immediate outcome of stronger congressional relations has been the introduction of the US-India Defense Cooperation Act in the US Senate, and its companion bill in the House of Representatives - a strong step forward in solidifying US-India defense ties and strengthening the overall bilateral relationship. Earlier this year, I recognised the need for policy advocacy to go a mile deep in addition to a mile wide. To drive this initiative, I've sharpened the focus on segmenting industry verticals to drive policy goals aggressively with the addition of three new verticals. Last September, I also had the privilege to commemorate the Council's 40th anniversary celebrations with US Vice-President Joe Biden, joined by seven cabinet-ranking ministers from both sides, including US Secretary of Commerce Pritzker, US Secretary of State Kerry, India's minister of state for commerce Nirmala Sitharaman, and minister of external affairs Sushma Swaraj.

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