Narendra Modi in US: Trade leverages can turn Donald Trump into a facilitator for closer bilateral ties

A lot of alarmist headlines have been generated as Prime Minister Narendra Modi's maiden meeting with United States president Donald Trump draws near. Trump's stance on H1B visa program and Paris Climate Agreement have predictably been flagged as potential conflict areas. Yet, it is possible to argue that India may enjoy more areas of convergence with a Trump-led United States than it may be reflexively apparent.

To begin, Indian strategists and policymakers surely are aware of the opportunity that a maverick POTUS brings to the table. During discussions and negotiations, a leader such as Trump might be more amenable to suggestions and display a greater risk-taking ability than a conventional politician unwilling to deviate from the beaten track.

Because of the fact that Trump habitually flouts strategic protocols, thinks little of United States' foreign policy establishment, cuts through diplomatic codes and is innocent of history, he may authorise sweeping decisions and elevate India-US ties to a greater trajectory.

File image of Prime Minister Narendra Modi and US president Donald Trump. Agencies

File image of Prime Minister Narendra Modi and US president Donald Trump. Agencies

As Uri Friedman reminds us in The Atlantic, "as a presidential candidate, he (Trump) vowed never to take advice on international affairs from 'those who have perfect resumes but very little to brag about except responsibility for a long history of failed policies and continued losses at war'."

If China or Saudi Arabia's handling of Trump is any indication, the US president's inconsistency and incoherence in matters of foreign policy can be turned to one's advantage, provided the key leverages are used. In North Korea, Xi Jinping had an effective bargaining chip to turn Trump's anti-China stance into a pro-China one. All that Saudis needed to do was to throw in a billion-dollar arms deal for Trump to side with the House of Saud.

For India, it has to be trade and commerce. Though the core edifice of the India-US relationship remains stable, built on sustained efforts from leaders of both nations, a few resilient structural vulnerabilities have prevented the world's largest democracies from becoming each other's natural allies. As Modi meets the US president, it is India's chance to see whether Trump plays a disruptive or a constructive role in forging bilateral ties.

Trump takes pride in being a "dealmaker". Some commentators have identified this attribute as an impediment because Indian foreign policy has traditionally been based on strategic logic and normative principles. It has never been defined in transactional terms. But India need not be on a collision course with Trump administration's 'America First' policy.

It may very well point out the fact that though India-US trade has ballooned to $115 billion in 2016, from a meagre $19 billion in 2000, the bilateral trade deficit hasn't kept up with the figure. India still enjoys a trade surplus and figures in Trump's 'black list' but it ranks way below competing nations. This might catch the fancy of a 'dealmaker'.

Especially so, when the potential for expansion in bilateral trade is huge. Here, Modi may allay some of Trump's fears by promising a less-protective regimen – a long-standing gripe of American businesses – and point towards opportunities for the US in areas of clean energy. India needs a massive amount of it; the US possesses the expertise and it is a matter of dovetailing mutual interests.

Trump's accusation against India on Paris Climate Agreement gave rise to a heated debate but in adversity lies an opportunity. New Delhi, for instance, has recently announced the setting up of two hubs for cleaner coal technology at an estimated cost of $248 million as part of its national mission on cleaner coal utilisation.

A media report, quoting Union environment minister Harsh Vardhan, states: "Under the India-US joint clean energy research, the new collaborative public-private programme on smart grids and energy storage has been approved. India has also embarked on a joint programme on renewable energy with Norway."

Modi administration has taken a lot of recent strides in areas of renewable energy like solar power but coal still remains the backbone for energy needs. While India is still some distance away from total reliance on cleaner and renewable energy, it is perfectly placed to make coal cleaner and more efficient. This is where the United States can come in in a big way.

As Brookings India fellow Rahul Tongia, and Brookings Institution fellows David Victor and Samantha Gross, write in Livemint, "Coal is a topic where India and the US can find common ground. In its mission to make coal more efficient and cleaner, India is implementing standards for sulphur emissions from coal power plants and is tightening standards for other pollutants linked to local air pollution, a major issue in India. Given limited Indian experience and manufacturing capabilities for the required retrofits, this is another opportunity for US technology providers, who pioneered solutions required by the Clean Air Act."

Stripped to the bone, any bilateral relationship is founded on mutual interest. A transactional leader might actually be better for India because Trump needs deliverables to show to his supporters and could even be willing to bend a few rules if need be.

For instance, India is quite comfortably the world's largest arms buyer and wants the US to approve its request to buy the naval variant of the Predator surveillance drone, according to a Reutersreport. Modi might push for the deal during his two-day visit and show it as a deliverable back home.

The US has already designated India as a 'major defence ally' and has pipped Russia to become the biggest arms supplier as India splurges on updating its arsenal and acquiring new weapons systems. 'Dealmaker Trump' might see here another neat opportunity.

Another less explored area that Modi may be expected to focus on is greater coordination between Indian and American states in terms of trade and commerce. The federal governments in both nations may play the role of facilitators as Indian and US businesses get down to the business of negotiating with their counterparts at the micro-level, where most of the action actually takes place.

In his piece for Times of India, Arun M Kumar, chairman & CEO of KPMG India, suggests that "for the US and India, it would be productive to have the leaders of the major states in each country, along with their business leaders, meet once a year in a structured setting to advance business and other mutual interests," which may sync naturally with Modi's push for greater federalism.

It is easy to become mired in preconceived notions of negativity. Yet, as the Lockheed Martin pact with Tata Advanced Systems to produce F-16 fighter planes in India shows (a move which Trump administration has reportedly approved of), leaders need not be trapped in images. The Modi-Trump meeting might be more fruitful than a lot are giving it credit for.


Published Date: Jun 22, 2017 05:28 pm | Updated Date: Jun 22, 2017 05:28 pm


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