By Rick Rossow
This month, President Barack Obama will return to India. There are fairly high expectations for the visit, and it is important to understand what could realistically transpire. Echoes of the July 2005 nuclear deal announcement continue to paint our expectations for what such summits should entail, and this view is unfair. There appears to be a good chance we will see announcements which, if judged by any measure except the nuclear deal, demonstrate a renewed commitment to partnership.
The agenda for the visit should be updates and extensions of the many work streams outlined in the September 2014 Joint Statement. Many of these work streams are quite vague, allowing for flexibility in determining the actions that will follow. The pace of bilateral visits by mid-level officials has been intense since the September 2014 summit as both countries try to ensure progress.
Defense: There are a number of defense deals pending which could be announced soon. But the Modi government is quite focused on creating a domestic defense industry, so progress in technology sharing and liberalizing the foreign investment environment will be critical. There may also be specific defense deals announced on the trip, as several appear relatively close to the finish line. We may also see progress in renewing the New Framework for U.S.-India Defense Cooperation which expires in June.
Climate Change: There are high hopes for major progress in promoting a shared agenda on climate change. However, the possibility of a game-changing agreement akin to the carbon emissions deal with China is limited for three reasons. First, India is only now making a concerted effort to industrialize, while China is shifting into (cleaner) services. Second, most of the necessary decisions on reducing pollution must be made at the state level, and Prime Minister Modi has few tools to press for states to follow his lead in areas such as fuel use in electricity generation- which produces the highest percentage of India’s greenhouse gas emissions. Third, India is poised to boost its coal economy by re-bidding largely-dormant coal blocks and allowing private development of coal. If the government is successful, it could dramatically increase the availability of low-cost coal—widening the cost differential between coal and cleaner alternatives.
While these factors may put a ceiling on the impact of U.S.-India collaboration on climate change, we do have the ability to make incremental progress. Sometimes a bit of seed funding, or the introduction of new technology, is all that is needed to help introduce cleaner and cheaper alternatives to existing sources of emissions. A great case in point is the World Bank’s work to introduce small home solar kits in rural Bangladesh, which now covers 10 percent of homes that are not on the electricity grid. These kits have a relatively high up-front cost, but the cost is thirty-five times cheaper to operate than kerosene. These types of environmental solutions make sense.
Nuclear Power: In addition to representing the crown jewel of strategic cooperation, nuclear power is viewed as a clean alternative to hydrocarbons. Finding a work-around to the liability issue that has stymied American contributions to India’s nuclear power sector would be a good step in helping India curb emissions. India would like 25 percent of its electricity supply to come from nuclear power by 2050, up from around 3.5 percent of India’s installed generation capacity today.
Regional Security: India’s pledges to work with the United States on issues such as North Korea denuclearization, security in the South China Sea, and rising conflict in West Asia generated a great deal of excitement among Washington’s security establishment. But finding tangible ways to cooperate in these areas is critical. Conflict in West Asia presents a particularly timely and substantive issue on which we can show our shared commitment to peace and stability.
Economic Collaboration: On economic collaboration, clearly the private sector must lead. Still, America’s agenda for engaging India on economic issues has been adapted since last year’s election, and reflects a great deal of pragmatism. References to manufacturing and infrastructure– critical elements to the Modi government’s economic planning — are sprinkled throughout the September 2014 Joint Statement. Partnering with three “Smart Cities,” taking trade missions to India, and establishing new working groups to explore policy solutions to tricky issues such as infrastructure financing are practical targets for cooperation.
U.S. Reciprocating Moves: India has moved forward with a number of the specific reforms proposed since last year, such as merging the “Person of Indian Origin (PIO)/ Overseas Citizen of India (OCI)” immigration programs, moving foreign direct investment (FDI) caps in insurance and other sectors, and extending a “Visa on Arrival” program to American citizens. This will increase pressure on the U.S. government to take up issues raised by their Indian counterparts such as negotiating a Social Security totalization agreement, increasing technical visas without new, damaging controls, or pressuring Pakistan to crack down on leaders of organizations suspected of fomenting terror attacks in India.
We continue to work in the shadow of the 2005 announcement of our intention to share civilian nuclear technology. It is difficult to imagine any “deal” or “deliverable” rivaling that announcement in terms of its strategic plus commercial value, thus threatening to make announcements during President Obama’s visit to India feel trivial. But that is not the case. Progress on some, or all, of the issues highlighted above will amount to substantive progress in the relationship. And the rest is up to the private sector, since economic cooperation remains at the root of our partnership.
Richard M. Rossow is a senior fellow and holds the Wadhwani Chair in U.S.-India Policy Studies at CSIS.