Getting on with the zigzag path

—Joint Statement,

November 8, 2010

President Obama's trip to India in November 2010 marked the culmination of a whirlwind of activity in US-India relations over the past half-decade. Beginning in 2005, the two countries initiated a deal on civil nuclear cooperation, signed a 10-year defence framework agreement, launched the ministerial level Strategic Dialogue, and came into alignment on India's long-standing request for US support for its bid to have a permanent seat on the UN Security Council. A growing economic and trade relationship, as well as expanding military ties where India now conducts more exercises with the US than any other country, have complemented these landmark achievements.

While President Obama's visit was well received in India, it may also represent the high point for bilateral relations in the near term. The reality is that over the past six months the bilateral relationship has shifted from big initiatives and centrestage to more routine interactions and schedule interruptions. While several summit follow-up meetings have taken place, including visits to India by outgoing Commerce Secretary Gary Locke and, most recently, Homeland Secretary Janet Napolitano, other meetings and policy activities have been pushed back due to the exigencies of both sides. The one initiative that could have provided the next big boost in the relationship — India's tender for 126 new jet fighters — did not. India chose two European entrants as the finalists in this $10-12 billion competition, a deep disappointment to both the US government and defence industry. This disappointment, however, may have been mitigated a bit this week with reports that the Cabinet Committee on Security approved the purchase of 10 Boeing C-17 cargo aircraft worth $4.1 billion.

Arguably more troubling is that the US and Indian private sectors, key drivers in building this relationship, have also expressed frustration about India's economic prospects with widespread corruption, the lack of parliamentary action on key pieces of legislation and concern about the shrinking opportunities for foreign direct investment which are threatening to set back India's impressive economic gains.

Meanwhile, in Washington, the Obama administration is preoccupied with crises in the Middle East and North Africa, ongoing military engagements in Afghanistan and Iraq, contentious budget battles, and is now beginning to gear up for the presidential election in 2012. This full plate of issues is tinged with frustration within official Washington about India's reluctance to make progress on a range of issues from agricultural cooperation to defence deals. For some, India's abstention on the Libya vote in the UN Security Council compounds the frustration. In the words of one US official, the US is focusing on "strategic continuity" for the coming year, which could be interpreted by some as placing the relationship on autopilot.

With the attention of policy-makers in both Washington and New Delhi trained elsewhere, the silver lining is that there are already a robust number of initiatives outlined in the Obama-Singh Joint Statement for both sides work on. The two countries now have some 30 formal dialogues or working groups established, covering every aspect of possible cooperation. "Implementation" should therefore replace the next "Big Idea" as the new watchword in the US-India relationship, along with ensuring that, as outgoing US Ambassador to India Timothy Roemer recently put it, "this needs to be a two-way street." In this regard, there are several steps both sides can take now.

First, the US and India should focus on a limited number of areas that offer a reasonable chance of success in the near term, and do not require parliamentary battles or the expenditure of major political capital to achieve. Examples could include establishing a roadmap for India's permanent seat in the UN Security Council, focusing on multilateral efforts such as the recently established US-India-Japan trilateral dialogue, and encouraging India to be more involved in Asian security and economic architecture, especially with the East Asia Summit coming up later this year.

Second, the US and India should intensify their consultation about regional issues where both sides have common interests. The US-India dialogue on Asia is a welcome first step in exchanging views and coordinating policy on Asia, to include exchanging perspectives on the implications of China's rise for the US and India. A bilateral dialogue on the Middle East is now needed given common concerns about the current turmoil and shared strategic interests of energy, democratic governance and stability. The US and India should also intensify their dialogue on Afghanistan by establishing a bilateral mechanism to consult frequently as July 2011 approaches and the US begins troop withdrawals. India will want to ensure its voice is heard in Washington as the US begins to transition security responsibilities to the Afghan government.

Third, the Indian government needs to engage in some introspection about the recent, dramatic drop in FDI (31 per cent in 2010) and growing investor concerns about doing business in India. As Roemer said in a recent Wall Street Journal interview: "The international business community that was pouring money and investment potential into India last year and the year before is now pausing and saying: 'Where is India heading in terms of investment opportunities, the corruption challenge and inflation?'" India needs to make US business feel that the Indian market is easy, predictable, transparent and, ultimately, profitable. In this regard, it would be helpful to re-energise Bilateral Investment Treaty discussions, which would provide investment protections to strengthen the ability of our companies to cooperate more effectively in both markets.

Fourth, both sides should use next month's US-India Strategic Dialogue, led on the American side by Secretary of State Hillary Clinton, as an opportunity to have a frank discussion about each side's expectations, and limitations for the relationship. Both sides need to acknowledge the recent distractions and frustrations in both capitals and articulate their future visions for the relationship.

Implementing these steps would provide a clear signal the relationship is moving forward, perhaps not as dramatically as the last few years, but one rooted in strengthening routine cooperation and consultation.

As both sides build the strategic partnership in the months ahead, comments by two experienced hands in US-India relations should be kept in mind. The first is from former Foreign Secretary Shyam Saran who said on a recent visit to Washington that while the pillars of our relationship are already in place, its direction is more likely to "zig-zag" than develop linearly.

The second is from US Assistant Secretary of State for South and Central Asia Affairs Robert Blake: "The US-India story still contains untapped potential and unrealised gains... But we must remember that this is a long-term project."

Excellent advice from both.

Inderfurth is at the Center for Strategic and International

Studies in DC, and served as US assistant secretary of state for South Asia from 1997-2001. Latif is a visiting fellow at CSIS and served in the US defence department from 2007-2011. The views reflect only those of the authors

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