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Past Event

The Modi-Obama Summit Policy Brief: Panel Discussion

Past Event

Panel discussion

On the 19th of September, Brookings India formally launched its US-India Briefing Book in anticipation of Prime Minister Modi’s visit to the US. Prime Minister Modi has clearly articulated that foreign policy should remain outside the realm of politics. His visits, then, have taken India to engaging with a broader global and regional framework, expanding on the previous government’s Look East policy. Both the US and India have a shared democratic ideology – the individual is at the core of both histories and equality/democracy is evident. There are a wide range of issues to explore, and possibilities of moving beyond discord. Healthcare, energy, climate change and education are ripe with possibilities for collaboration. Engagements prior to the Summit have also been fruitful, moving towards collaborative action.

In this context, the Modi-Obama summit is being viewed as a leadership movement on both sides– how do the two countries advance to address issues of substance? The relationship is reaching a stage beyond the bilateral, and the two countries have the potential to co-operate and collaborate on issues of climate, cyber, food, trade, maritime, space and nuclear. There is a renewed eagerness to move beyond MoU’s to actionable decisions. The two countries can focus on trade, commerce, business, and particularly deeper ties in defence. Brookings scholars, in particular, can build on people-to-people contact beneficial to this process. If both countries respect each other’s mutual sovereignty, there are huge possibilities for both countries to lead in world governance.

However, external events in the global security framework will place a strain on the Indo-US bilateral relationship. India and the US are divergent in their interests and ideological approaches to the Middle East. It has become increasingly evident that US interest in the Middle East are not simply centred on oil – rather, it seems to be exercising the ideological responsibility of ‘global peacekeeping’. In light of recent development between the US and Russia, there is also likely to be a strain in the relationship as India may not choose to downgrade its relationship with Russia. However, in the area of counter-terrorism, there is need for the US and India to accelerate collaborative efforts, particularly with regards to IS’s growing influence. Nonetheless, the US’s track record in fighting the IS has itself been shaky, and India will have to look closely at what kind of cooperation they require before committing to assistance.

This visit should not be measured against the template of the ephocal bilateral nuclear deal. The Indo-US nuclear deal did not lead to partnership – rather, it came as the result of a long-term strategic relationship. While all relationships have a transactional element, these are often premised on a foundation of common strategic terrain. However, the convergence between the two countries in today’s global security architecture seems to have weakened.

Potential deliverables and non-deliverables

India is keen to expand its own R&D budget, as well as its technological base and its innovations. India and the US can collaborate on moving forward in advances on health, climate change and environmentally-friendly technology. While climate change is an important global issue, there is concern to move towards environmentally favourable energy – particularly solar and wind power. While Free Trade Agreements are not necessarily the way forward, investment-friendly-measures can be taken to ensure bilateral movement just short of an FTA. The US would benefit from such an agreement as they have the primary resources available for investment.

The nuclear liability act is a key point of contention between the two countries. India’s domestic liability act places financial responsibility on the nuclear operator in case of an accident. In addition to this, it accounts for an international pool to supplement assistance to victims of nuclear disaster. This is tougher on operators than the determined domestic model act decided on by the Convention on Supplementary Compensation for Nuclear Damage, leading to a significant obstacle in taking forward the Indo-US nuclear deal.

India’s recent position in the WTO was to take a long-term perspective to protect the impoverished within the country. The debate centred on trade facilitation, but India’s representatives needed to make sure the issue of food subsidies and security was not compromised. As Indian farmers don’t have the loans, assurances, social security and healthcare that Western farmers can rely on, they need to have the safety net of governmental food subsidies. India’s position is not to disagree with trade facilitation, yet its discussions with other disadvantaged African countries revealed similar concerns on the matter of food subsidies.

In the WTO process, however, there are issues of principle and issues of practicality. On the subsidy issue, the principled stand is based on opposition to a flawed pricing assumption. On the practical stand, there is also the matter of cross-retaliation, in which case the positions taken on one issue will lead to repercussions in other issues (clear from the post-Bali meeting). India must deal with the WTO discord with some reliability of coalitions. Till other countries have expressed support and commitment to a coalition, there are risks of following through with a principled stand. Indeed, it is less about alignment of interests, and more about deal-making with mutual interests. India must operate on multiple fronts – push forward the principle, create coalitions, and avoid cross-retaliation. It has to try and engage as much as possible in plurilateral structures.

In the context of immigration and investment treaties, American investors want the opportunity to invest in India because they have investment surplus available. India can offer its population strength and its knowledge base. However, it was pointed out that if the latter is not able to flourish (i.e immigration disputes), neither should the former.

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