Prime Minister Narendra Modi concluded a successful visit to the US last month. He spoke to the United Nations General Assembly, an adoring crowd of Indian Americans in Madison Square Garden, and a rock concert audience in Central Park, before meeting with some of America?s top CEOs and President Obama. This was an impressive performance, solidifying his reputation as a leader for India on the global stage.
At the UN, the PM offered the standard words in support of international cooperation and economic development, but perhaps somewhat more forcefully than usual about the role of technology in positive change. He also signaled India?s intended positive leadership role in South Asia, sent a warning to Pakistan, and indirectly made the case for India?s membership of the Security Council. Perhaps the most interesting and distinctive part of this speech was his touting of yoga as India?s ongoing gift to the world.
In a brief appearance at the Global Citizen Festival at Central Park, Modi seemed to hit the right note for the young crowd, and returned to a campaign theme of appealing to India?s youth for positive change. The Madison Square Garden event with Indian Americans was the real love fest, with the PM reiterating campaign promises for economic growth, reducing poverty and cleaning up the Ganga. He sealed his relationship with the audience by promising streamlined visa procedures for US citizens.
These large public appearances in New York cemented Modi?s rock star-like reputation as a political leader for the masses. But the smaller Washington, DC meetings were the ones where the real business of the visit was accomplished. Meeting with US CEOs one-on-one and in groups, the PM seemed to have been extraordinarily successful in assuring them that India would improve its environment for doing business, so much so that a post-visit survey of members of the US-India Business Council came up with a figure of $42 billion in planned investment in India over the next two to three years?and this number was from just 20% of the membership. Importantly, this survey figure provided a headline dollar commitment to rival those that came out of Modi?s Japan visit and the Chinese president Xi Jinping?s India visit.
Concrete steps toward facilitating investment include a collaborative Indo-US Investment Initiative and an Infrastructure Collaboration Platform. Interestingly, the CEOs came away feeling that the Indian PM understands what business is about. What will be crucial is if he can change the way his own government regulates business and makes it possible for domestic entrepreneurs to thrive, not just foreign investors.
Perhaps the greatest achievement of the PM?s visit, however, was the meetings with President Obama. According to accounts from the US side, the President and the PM developed a strong rapport, sharing stories and connecting with each others experiences. A personal rapport does not mean ideological agreement?Obama?s instincts are less favorable to big business and more pluralistic than Modi?s but perhaps the two leaders will learn something from each other. Meanwhile, this kind of connection is a crucial precondition for collaborations between the two governments. The PM and the President also issued a joint statement, which provides a comprehensive list of areas of cooperation, including energy, technology, education, health and security, among other things. Modi is likely to do relatively better than Obama in translating his goals and this list into actions by bureaucrats in his administration, but the Indian side is precisely where progress is most necessary. Also important, Modi met with Hillary Clinton, Obama?s possible (even likely) successor.
In sum, Modi?s US visit exceeded expectations, and raised them. Will these new expectations be met? Modi?s cabinet team is still somewhat thin and unseasoned. But he is used to dealing directly with senior bureaucrats, and there is a good amount of talent and expertise to be harnessed. The challenges will come from two directions. One is politicians and business people who continue to operate in a mode of transacting for favours. Modi?s goal of ?maximum governance? is a long way from being realised. The second challenge will come from the extreme elements that are in and around the ruling party. Modi himself has projected a relatively benign version of national (Hindu) tradition, with spirituality, Sanskrit and yoga. But in just a few months since his government took office, there have been multiple instances of disturbing statements from politicians associated with the ruling party. What is worse is that such extremism becomes an excuse for extreme responses from those who see themselves threatened.
Do Modi?s domestic challenges have anything to do with his US visit? US politicians and business leaders would prefer to see India?s government avoid anything that would destabilise that nation or the region. They have no vested interest in the ruling party?s ideology. The same cannot be said of some of those who filled Madison Square Garden. Those Indian Americans have to avoid getting carried away, and doing anything to create polarisation in India
The author is Professor of
Economics, University of California, Santa Cruz