Whither U.S.-India Relations? A Historic Look at Ties Presaging the Biden Administration

As of June 19, the Biden administration has not announced a candidate for the ambassador’s position in India. Nor is there a clear read on the direction of its engagement with India. India’s relations with the United States have always been a little less cordial than would be expected of the world’s two largest democracies. If anything, historically India has been on the periphery of America’s strategic map, with Pakistan, Afghanistan, and Iran occupying greater importance. Of course, things are much better now than during the Cold War, when India was perceived to have made a tilt towards the Soviet Union via its Treaty of Friendship, and the U.S. was viewed as a Pakistani (albeit unreliable) ally due to its defense agreements and arms transfers to that country.

India’s relations with the United States got off to a rocky start from the first state visit by Prime Minister Nehru in 1949. Members of the Indian delegation were reportedly told of how General Motors’ sales turnover was larger than India’s GDP. Nehru and his counterpart President Truman might well have been from different planets. The Harrow and Cambridge educated Nehru saw himself as the leader of the first of many developing country democracies, while the folksy Missouri native Truman viewed him as the leader of a poor country who had no business proffering advice to the “leader of the free world.” Nehru’s ambassador to the UN, VK Krishna Menon, was a hard-nosed leftist who frequently voted against the U.S., on occasion against the advice of Nehru. 

While some aid was forthcoming during the Eisenhower years and also the first U.S. presidential visit to India, India’s leadership of nonalignment had been met with a terse “neutrality is immoral” by Dulles (Eisenhower’s Secretary of State). Later John F. Kennedy met with Nehru and their meeting was described as a disaster by Arthur Schlesinger who was then an assistant to the President. By the mid-1960s, India was seeking defense equipment from a more compliant and less demanding Soviet Union. Matters remained glacial between Indira Gandhi and Nixon (he famously referred to her as “that bitch”). India’s testing of a nuclear device in 1974 against the norm of the Nuclear Nonproliferation Treaty (NPT), which it had not signed, deepened the rift, as did the lack of Indian condemnation of the Soviet invasion of Afghanistan. Throughout these years India remained at odds with the United States with its nonalignment-based foreign policy, its welfare socialist and public sector-led model of the economy, and its partiality to the leftist cause – all three being anathema to the U.S.

A major change emerged in 1991 when the end of the Cold War and consequently Russian support (also the end of the Soviet Union) coupled with the balance of payments problems caused by profligate spending by successive Indian governments led to a somber reappraisal and change in direction in the three fields mentioned before. While remaining nonaligned India was open to making common cause with the United States when needed. The economy incrementally changed to a more liberalized one where the pursuit of wealth and riches was now encouraged and lauded, and India’s political parties became less leftist in tone and more pragmatic (or self-serving). 

A major change was the rise of the Bharatiya Janata Party and its muscular nationalism, which was open to seeking a better relationship with the United States both militarily and economically. India’s “coming out of the nuclear closet” ended the ambiguity about the weaponization of its nuclear program and cast water on efforts to boost ties with the U.S. but soon American help in ending the Kargil Crisis (or allowing Pakistan to save face and get out under U.S. pressure) underlined the need for cooperation.

On the U.S. side as well, post-Cold War dynamics necessitated a change in approach.  By 2000, Bill Clinton had designated India as a “Big Emerging Market” and consequently abandoned the hyphenated view of the country stapled with Pakistan to the extent that he spent only six hours in the latter country while spending five days in India on a state visit. There was much interest in India’s fabled 200 million-plus middle class that might purchase American products. The United States relationship solidified with the Bush-Manmohan Singh agreement in 2005 which enhanced trade and importantly allowed India a waiver on its nuclear program which was somewhat derisively referred to as the “Mangoes for nuclear technology deal” by opponents.  However, defense cooperation has not taken off sufficiently. Notably, India has pursued its need for a major fighter aircraft with France in its Rafale and not an American supplier. 

There was an initial kerfuffle when Biden administration was slow to respond to India’s sudden second Covid wave in April in terms of not offering immediate support or removing restrictions on exports of equipment and material for vaccine production.

What has emerged in the past few years has been a visible willingness by Republican administrations to do business with India and overlook issues of nuclear technology (under Bush) or human rights (under Trump). Democrats have been less supportive of Indian nuclear positions going back to the Carter administration’s imposition of an embargo of dual-use technology to India following its 1974 test. They have also in recent years been uncomfortable with the Modi government’s policies that have negatively affected Muslims. In contrast, Donald Trump was observed in ads intoning “We love Hindus! We love India,” and “Ab ki baar, Trump sarkar” (this time it will be a Trump government) – lifting lines from an earlier similar BJP ad for Modi in India to resonate with Hindu Indians in the U.S. Indeed, lots of Indians voted (unusually) for Trump and one Indian immigrant was among those in the crowd at the Capitol on January 6 this year.

Which brings up the question, what is Biden likely to do on India? There was an initial kerfuffle when his administration was slow to respond to India’s sudden second Covid wave in April in terms of not offering immediate support or removing restrictions on exports of equipment and material for vaccine production. That was subsequently changed, and U.S. aircraft have flown to India with medical supplies since then. But as mentioned earlier, there is no U.S. ambassador to India. This is surprising because India has been grouped as being part of the “Quad” – the group of states that are wary of Chinese ascendance in Asia and also include Japan, Australia, and the United States. An ambassador to such an important regional ally would be the norm. 

However, Biden’s presidency is not a normal one. His victory was questioned in the 11-week transition period and there was never a formal concession by his predecessor. Moreover, the U.S. has been hardest hit by the pandemic in terms of deaths (those officially reported) and the first two months of this year and Biden’s presidency coincided with the post-winter-break surge in cases. Add to that the narrow victory of the president in the Senate with recalcitrant conservative Democrats and Republicans who are united in blocking every aspect of any Democratic agenda and one can understand why international concerns might not be too pressing.

India and the United States have areas that could do with strengthening their relationship before a trade deal can emerge. Both countries have sought one for some time now and it looked like one might materialize during the Trump visit a year ago, but differences prevailed and matters stagnated. India accounts for roughly 3% of U.S. trade, while America is significantly higher with 17% of India’s exports going there. It is also the third largest provider of imported goods after China and the EU (country-wise second). But disagreements continue over India’s market access and tariff rates. 

India is notorious for being one of the least business and market-friendly countries among the largest economies and this has proved a sticking point in negotiations. India’s tariff rates are very high as well particularly in agriculture – the Modi government’s law that was being protested might allow greater foreign entry into agriculture. In telecom and the cell phone market India recently raised tariffs from 0 to15-20% — legally allowed by the WTO but disputed by the U.S. as its firms suffer in exports. In turn, India protested at the Trump administration’s national-security based tariffs on steel and aluminum to the tune of 25 and 10% respectively and the elimination of India from the Generalized System of Preferences – a system that allowed countries to impose differential tariff rates depending on their developmental level and in opposition to WTO guidelines. 

The U.S. would like better access to service industries where India has made entry difficult, and the U.S. (like other developed states) holds an edge. In return, India would like some movement on service sector immigrants and social security protection- doubtless due to the munificent remittances from this source. There are also U.S. complaints about Indian practices that amount to forced “localization” of sourcing in certain areas as well. Indian investment rules are also not considered particularly welcoming although they have changed radically from the protected markets of three decades ago. 

Finally, patent rights issues, especially in pharmaceuticals, remain an area to be resolved. India is widely considered the pharmacist of the developing world, and its generic medicines provide the bulk of what poorer countries can afford to buy. Consequently, big pharma in the U.S. is pitted against Indian firms that seek a reduction in patent protection time.

As stated above, this is more important to India than for the United States, just in terms of the relative impact on each other’s economies. Defense cooperation has increased significantly, but India remains shy of purchasing outright a major weapons system from the U.S. 

On the U.S. side, there is a satisfaction that India has moved from its “tilt” towards the Soviets to a closer partner, but issues remain. The other three members of the Quad are liberal democracies while India just got downgraded by Freedom House from Free to Partly Free status. Railing against China for its treatment of Tibetans and Uyghurs is difficult when comparisons with India do not draw a very favorable response.

Biden will have to weigh strategic concerns vis a vis China versus the deteriorating political situation in India as well as economic linkages there in deciding to engage with the South Asian giant.  Time will tell whether he will stick to the America First policy of his predecessor or go back to the liberal globalism practiced by previous presidents, both Democratic and Republican.

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Dr. Milind Thakar is a Professor of International Relations in the Department of History and Political Science at the University of Indianapolis.