1. India and US ties: Here is how to target larger payoffs than just investments

India and US ties: Here is how to target larger payoffs than just investments

The recent US visit of India’s prime minister Narendra Modi garnered an unusual amount of media attention, perhaps because US president Donald Trump himself is more of a media celebrity than a working politician.

By: | Published: July 6, 2017 6:37 AM
india us ties, narendra modi, donald trump, india america ties The most high-profile reports were on the Modi-Trump hugs, and how they represented a trumping (pun intended) of the bizarre presidential handshake, even better than tugs-of-war, hand-clenching competitions, or shoulder grabs tried by other national leaders.

The recent US visit of India’s prime minister Narendra Modi garnered an unusual amount of media attention, perhaps because US president Donald Trump himself is more of a media celebrity than a working politician. The most high-profile reports were on the Modi-Trump hugs, and how they represented a trumping (pun intended) of the bizarre presidential handshake, even better than tugs-of-war, hand-clenching competitions, or shoulder grabs tried by other national leaders. More substantively, India seemed to have succeeded in its charm offensive, with Trump relatively positive and effusive, and his family invited to India for the now-common mixing of personal and national business that is characteristic of the current US administration (but something quite familiar to those in India).

India also obtained an arms deal, and joint statements on Islamic terrorism and Pakistan in particular, while avoiding areas of disagreement such as what is to be done about climate change. The two leaders are both nationalists, albeit of different kinds, and subscribe to different versions of Islamophobia, but otherwise are quite different. India’s prime minister may be egotistical, but not in the narcissistic, unpredictable manner that characterises his American counterpart. Trump has invited numerous comparisons to a toddler who lacks self-control and command of basic boundaries of social behaviour.

All this means that interactions between the US and India at this level are likely to stay somewhat fraught, with Trump prone to lashing out whenever he perceives he is not getting what he wants, either in terms of personal gratification or sops for his political base. Looking over the history of India-US relations, the personal equations of those at the top have certainly mattered, but so have larger strategic considerations. The latter seem to be aligned for India and the US on the security front, which is not a bad thing. But the plane of cooperation that will really matter for India is that of economics and business. One cannot repeat enough times the importance for India of accelerating growth and job creation at a time when its demographic changes urgently demand such speed.

Prime minister Modi also met with US CEOs, and by all accounts this, too, was a positive meeting. Increased foreign direct investment by US companies in India, especially if it enables and increases the transfer of technological and manufacturing know-how, will be an important part of India’s growth in the coming years. But we should also remember the history of US-India economic interactions. The 2005 US-India Agricultural Knowledge Initiative has had limited impact, and been controversial because it seemed to be geared toward promoting US agribusiness interests. By contrast, successful and long-lasting impact in US-India interactions has come when a mix of people and ideas from non-profits, academia and government were involved along with—or even without—corporate interests. I think the original impetus for the Green Revolution had this flavour.

What are the lessons of this perspective for the current situation in India-US economic relations? I would suggest that a top-down approach that relies on large deals, symbolic cooperation and corporatism will be less likely to be beneficial than a web of relationships that encompasses many layers of institutions. If we use the Indian American diaspora as a conduit, one can illustrate the possibilities. In our book, The Other One Percent: Indians in America, Sanjoy Chakravorty, Devesh Kapur and I reported on a unique survey of over 600 Indian American entrepreneurs and professionals. We found a relatively high degree of engagement with India, both in politics and business. Here, we are not talking about just a few high-profile US CEOs of Indian origin, but a range of occupations, backgrounds and expertise. US academia is also replete with successful Indian Americans, including deans of engineering and business schools. And the community is also increasingly present in the US non-profit sector and the media.

India has an opportunity to welcome multiple layers and types of engagement with its diaspora in the US, and building a web of such relationships is likely to pay off handsomely in terms of economic development. The current government has tended to be suspicious of foreign NGOs, almost to the point of strangling them. Academic cooperation is also often more restricted than it needs to be. Only financial investment has seemed to be welcome, but other kinds of ties can often have larger payoffs.

During the recent visit, the Modi also met with Indian Americans, but the focus seemed to be on a relatively small nationalist element of that community that also finds itself attracted to Donald Trump, rather than the majority of Indian Americans who seem to be more comfortable with a more liberal-leaning, pluralistic or even progressive view of American society than Trump espouses. Donald Trump is ultimately, in my view, on the wrong side of history, and Indian Americans who think that his economic nationalism and xenophobia will help them or help India are mistaken, again in my view. India’s leadership should have the confidence to invite and engage with its diaspora in the US in ways that it has not yet imagined. Those successful engagements have historical precedents and can be reinvented for the future.

  1. Subhash Garg
    Jul 6, 2017 at 7:31 am
    An excellent way to benefit from experts in the diaspora is consulting contracts with Niti Aayog or other government agencies unrelated to defense and space. Another way is to invite academics to give week-long short courses NOT on their research, bu on their ideas on how to solve problems of urgent priority in India (as opposed to the West). Thirdly, India needs to set up a research funding agency like DARPA that molds research in ins utions towards India's problems.. for example water, power, school education, vocational education, housing, roads, trural health and so on.
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