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US-India Ties Moving in Right Direction

India Report by John E. Carbaugh, Jr.
April 24, 2002

An exclusive report from Washington, D.C. on political, trade and defense issues affecting India.

Deepening U.S.-India strategic cooperation, including the taking off of bilateral military ties, has long-time proponents of closer relations between the two nations cheering -- although observers caution that there are plenty of obstacles that could derail this progress.

"Amidst all the change in the region since September 11, one thing has remained a constant. This is the ever-broadening and strategically important U.S. relationship with India," said Deputy Assistant Secretary of State for South Asian Affairs Donald Camp earlier this month.

Military Ties Take Off

The most noticeable developments in recent weeks have been on the military front, with Camp noting that the two countries are quickly moving to "a more robust military partnership." Indeed, the U.S. and India have just concluded a major weapons deal, the two nations are planning a significant joint exercise in the U.S., and they have agreed to a joint naval operation in Asia -- cooperation that would have been unheard of not so long ago.

The Pentagon described India’s move to buy eight Raytheon Co. long-range, weapon locating radars for $146 million as "historic." The AN/TPQ-37 Firefinder is a medium-range system that detects and reports the position of enemy artillery, mortars and rocket launchers. It is capable of locating up to 10 different weapons systems within 35 miles in seconds. After an enemy weapon is fired, the system relays precise information for locating it and counter-firing.

Key Weapons Deals for India

Analysts said that the Firefinder was a priority acquisition for the Indian military, which has been constrained by its lack of such a system during frequent exchanges of artillery fire in the disputed Kashmir region. "The purchase by India marks a shift in the military balance in the Kashmir conflict with Pakistan," one observer noted. "Although the Pakistani army already has a Firefinder system, India’s acquisition will give it superiority over Islamabad due to its substantially larger artillery force."

Bush Administration officials stressed that the first major U.S.-India weapons deal in more than a decade illustrated the new closeness of the relationship.

Joint Training Planned in U.S.

Similarly, in what was also lauded as illustrative of the new level of U.S.-India strategic cooperation, it was recently revealed that Indian soldiers will train with U.S. forces in Alaska. This "definitely marks new levels of cooperation" with India, said Joseph Cirincione of the Carnegie Endowment for International Peace in Washington, who noted that the U.S. only conducts these kinds of training exercises with its allies and close friends.

The planned training, slated for next year, would mark the first time Indian forces have been invited to participate in military exercises in the U.S. The training in Alaska at high altitudes and possible snow would match conditions in the Siachen Glacier of northern Kashmir, observers note, and the scene of long-standing Indian tensions with Pakistan.

The U.S. and Indian air forces are also planning to conduct joint exercises in the South Asian region.

Joint Naval Patrols

Defense links between the two countries have already deepened in the last few months, with greater intelligence sharing and India’s decision to join the U.S. in joint naval patrols in the Indian Ocean between the Straits of Malacca and the Straits of Hormuz, an area that has seen critical maritime trade threatened by piracy, that is a potential concern for terrorism, and that could be subject to a blockade in a major regional conflict.

Assistant Secretary of State for South Asian Affairs Christina Rocca praised India’s agreement to monitor the Malacca Straits with the U.S. "This step shows once again the transformed U.S.- India relationship when we have this kind of cooperation in the war on terrorism as well as a number of other fields as well," she said.

The new military cooperation could not have been envisioned too long ago, with defense ties still frozen following India’s 1998 nuclear tests. However, overall relations have improved with President Bill Clinton’s visit to India in March 2000, and then the Bush Administration’s vow to give ties with India a higher priority.

Now in the post-September 11 environment, the U.S. has lifted most of its remaining sanctions on India, most notably allowing defense cooperation.

"President Bush made clear when he first came to office that improving ties to India was a top priority, and that has not changed," Camp said. "In fact, the war on terrorism has only deepened our ties as we work side by side to root out terrorism and to promote our common values of ensuring freedom and security for citizens worldwide."

China Factor

Some observers say the improved military ties are part of Washington’s view that India can be a very useful counterweight to China. The U.S. is "seeking out New Delhi as a future partner to contain a burgeoning China," one expert noted.

Indeed, the joint naval patrol in the Malacca Straits sends an implicit signal to China of New Delhi’s military prowess, some observers point out.

Overall, competition between Beijing and New Delhi is heating up, one analyst said. "China and India both view the Southeast Asian region as a vital source of natural resources and a market for their goods. Beyond the economic factor, the two countries also view the region as part of their spheres of influence, and vital to their own national security."

However, despite the developing strategic cooperation between the U.S. and India, there are plenty of pitfalls in the budding relationship, including both countries’ ties with Pakistan, continued nuclear proliferation concerns, and problematic economic issues.

Pakistan Wild Card

The U.S. still needs Pakistan’s critical cooperation in the war on terrorism. However, Pakistan might be less willing to help if it feels that the U.S. is tilting too much toward India. Indeed, the recent weapons-locating radar deal -- which helps India’s military deal with Pakistan forces in the Kashmir -- has upset Islamabad.

Similarly, the planned joint training exercise in Alaska is sure to anger Pakistan. "It’s very likely that Pakistan will have a strong reaction," cautioned Carnegie’s Cirincione.

Another observer noted that "Continued and increasing military technology transfers and cooperation with India may sour Pakistan’s willingness to assist the United States in its war against terrorism."

However, he added that "while the hunt for Osama bin Laden and al Qaeda members is the short-term goal of the United States -- with Pakistan’s cooperation remaining vital -- in the long run Washington hopes to see its interests in the region better served through fostering a strategic relationship with India."

Kashmir Tensions

U.S. officials also worry that the developing relationship with India will be derailed if major tensions between New Delhi and Islamabad flare up again. "The U.S. has been deeply concerned over the crisis between Islamabad and New Delhi, particularly the mobilization of forces along their shared border, following the December 13 attack on the Indian parliament," said Camp. "Although the crisis has eased somewhat, we remain concerned about the continuing real danger of military conflict."

Camp urged India and Pakistan to tone down rhetoric, restore full diplomatic relations, and reduce military postures. "We hope India and Pakistan will agree to resume dialogue on all issues, including Kashmir, and we are urging Pakistan to curb militant infiltration and urge restraint in Kashmir. We are encouraging India to address Kashmiri grievances and to ensure the widest possible participation in upcoming state elections. India and Pakistan can only resolve their differences through direct dialogue. We can encourage, but they must act."

Although the Bush Administration has ruled out any direct U.S. role in mediating a solution to the Kashmir problem, Harry Thomas, the director in charge of South Asia policy at Bush’s National Security Council, stressed the importance the U.S. places on seeing India and Pakistan resolve the conflict peacefully.

"Our highest priority right now is to keep India and Pakistan from going to war," he said. "A war is unthinkable. It will be devastating for the global campaign against terrorism."

India, Thomas also stressed, will not be able to reach its full potential "unless it gets past this [Kashmir] problem."

Nuclear Worries

Given the potential for conflict between India and Pakistan, the U.S. also continues to be worried over their nuclear weapons.

Assistant Secretary of State for Non-Proliferation John Wolf said this month that one of the Bush Administration’s top non-proliferation priorities is capping nuclear and missile proliferation in South Asia and preventing any outward leakage.

"The proliferation of WMD [weapons of mass destruction] is regionally destabilizing. Nowhere is this more evident than in South Asia, where one million troops face off on the India-Pakistan border," Wolf pointed out. "The presence of WMD and missiles in the region has dramatically increased the danger of miscalculation during times of crisis, and the resulting regional instability magnifies the risk of these weapons falling into the hands of terrorists.

"While the recent sharp escalation in tension between India and Pakistan has reminded us all of the pressing danger of unchecked proliferation, it is not clear that Pakistan and India have yet drawn the right conclusions from this crisis about the danger their WMD and missiles pose," Wolf warned. "We hope that confidence-building measures like keeping weapons and delivery systems separated, halting fissile material production, and restraining nuclear and missile programs can be implemented. Tightened export controls are also vital to ensure that India and Pakistan do not become a source for sensitive materials and technology."

Wolf stressed that non-proliferation in South Asia is still a major U.S. priority despite the U.S. lifting its sanctions on India and Pakistan. "We are actively engaged with discussions on the risks that the nuclear-weapons programs of Pakistan and India pose to stability in South Asia. It remains an issue not only in terms of South Asia, but the risks of those various technologies -- not just nuclear -- escaping from and being clandestinely exported from South Asia. This would be true for both Pakistan and for India."

Misperception Worries

However, Michael Krepon of the Henry L. Stimson Center in Washington, contends that overall Washington needs to do a better job of dealing with the tensions in South Asia. "The risk of war and nuclear dangers feed on misperceptions. By this measure, South Asia remains a very dangerous place. One needs look no further than the present, elongated crisis between India and Pakistan for confirmation of how poorly New Delhi and Islamabad appear to understand each other. To complicate matters further, Washington also has great difficulty ‘reading’ the tea leaves in South Asia."

Krepon warns of dire consequences because of continuing misperceptions of each others’ actions by India, Pakistan and also the U.S. "The current crisis is laden with the potential for tragic miscalculation," he said. "False assumptions and misperceptions abound. New Delhi, Islamabad, and Washington read current developments quite differently, and since these developments lend themselves to divergent explanations, greater clarity is likely to elude decision makers for the duration of the crisis. Worse still, the denouement of this crisis is likely to confirm views that are misleading, wrong, and mutually reinforcing. Just as the Kargil war contributed to the current crisis, this crisis can easily lead to the next confrontation.

"The hard reality of a nuclearized South Asia is that crises are more likely, and that crises do not lend themselves to mutually satisfactory outcomes. Grievances as well as false certainties are therefore generated, which are then manifested in the next crisis," Krepon stresses. "Serious diplomacy is needed to break this vicious cycle -- not the diplomacy of empty rhetoric, not diplomacy that conceals collusion with acts of terror, and not coercive diplomacy that relies on the threat of war. One central purpose of serious diplomacy must be crisis avoidance. This cannot happen in the absence of a sustained and substantive dialogue centered on escalation control, nuclear risk reduction, and the Kashmir issue."

Economic Ties Lagging

Another problem area that could trip up U.S.-India ties is the somewhat lagging economic relationship. "India’s relations with the U.S. are at an all time high, but to consolidate this and to further improve its attractiveness as a partner, India must forge stronger economic foundations to its bilateral ties with the U.S.," said Venu Rajamony, a visiting fellow at the Center for Strategic and International Studies (CSIS) in Washington.

There has been growing concern in the U.S. that the economic component of the relationship could be the weak link that could stall the prospects for a more productive overall alliance.

"When the U.S.-India rapprochement began in the late nineties, economics was the main driving force," Rajamony said. "Today, in comparison to the progress made in other fields, economics appears to be the weak link. However, the importance of this factor and the role it can play in bringing the two countries closer together cannot be underestimated."

U.S. Ambassador to India Robert Blackwill acknowledged that while political and military ties between the U.S. and India have improved, the economic relationship has lagged. "I am convinced that the long-term success of the U.S.-India bilateral transformation will hinge importantly on a parallel invigoration of our economic relationship," Blackwill said.

U.S. officials have thus recently made it clear that Washington wants to return to boosting trade and investment ties with India -- a project that has taken a back seat to security matters in the last couple of years, especially since September 11. "An area of great potential for cooperation is in trade ‘and commercial cooperation," Camp said. "India’s economy has expanded rapidly since reforms in the early 90s. Exports to the U.S. have more than doubled since 1995. In order to fully exploit this economic potential New Delhi must continue to pursue important second-generation reforms. These will help lock in the progress made by its earlier liberalization. Our hope is that the Indo-U.S. private and public sector economic dialogues will be used to work through contentious economic issues such as these."

As well as hampering bilateral relations, India’s problematic economy holds it back from its claims to great power status, many observers contend.

U.S. Calls for More Economic Reforms

The U.S. wants India to more aggressively press ahead with trade liberalization and a so-called second generation of economic reforms. The first phase of reforms and trade liberalization in the early 1990’s generated a substantial expansion of trade and acceleration of India’s economic growth to 6-7 percent, the U.S. contends. However, in recent years India’s reform program has stalled on many fronts.

The Bush Administration acknowledged that the Indian Government has recently made some moves in the right direction, including eliminating export quotas as part of its effort to double Indian exports to more than $80 billion by 2007, and the plans to create special economic zones.

"These steps offer promise in contrast to currently low U.S. trade and investment in India," Under Secretary of State for Economic, Business and Agricultural Affairs Alan Larson told a U.S.-India technology conference earlier this month.

However, the U.S. wants India to do much more. India needs "to reduce the overwhelming regulatory requirements that stifle trade and discourage investors and in reality act as a tax on Indian consumers," Larson said. "India needs to streamline and rationalize the conflicting state requirements that bewilder both investors and those who would export into your markets. This is especially true concerning regulatory oversight of activities in the special economic zones. And India needs to significantly reduce customs duties and the range of other taxes and fees that make imports so expensive in India. Just like regulatory burdens, these duties and fees are a huge drag on Indian consumer spending and saving."

Overall Ties Move in Right Direction

Nevertheless, despite the obstacles in the way to deepening U.S.-India ties, overall the relationship is moving in the right direction. "We continue to promote intense cooperation with India on a broad array of issues," Camp pointed out. "They range from economic dialogues and business ventures to collaboration on new international strategic and security frameworks to countering terrorism. This administration has recognized since long before coming to office that India is emerging as an influential global power."

These areas of bilateral interest span the globe, Rocca added, evidence of a "transformed relationship" between the U.S. and India.