RPI Author Deepa Ollapally: For India, the US Is Now Just First among Equals

RPI Author Deepa Ollapally: For India, the US Is Now Just First among Equals

22-modi-smileWith the Modi government’s “Act East” foreign policy to strengthen its relations with China, Japan, Australia, Deepa Ollapally, Research Professor of International Affairs and the Associate Director of the Sigur Center for Asian Studies at the Elliott School of International Affairs, George Washington University, recently wrote an article in India Abroad where she argued “for India, the US is now becoming just first among equals.” Ollapally claims that while the Modi government will likely maintain steady progress on foreign policy in Asia, it is “not clear where additional breakthroughs are going to be made in Indo-US relations.”

Since coming to power in May, one thing is clear: Narendra Modi has only strengthened his hold even more over the ruling Bharatiya Janata Party by coopting or sidelining his peer competitors and detractors, and elevating his close associates.

Sushma Swaraj, who had prime ministerial aspirations of her own, is now foreign minister, but it is safe to say that even with the firebrand Swaraj handling foreign policy, it is Modi who is at the forefront (probably to Swaraj’s chagrin). Senior BJP leader L K Advani, who made no secret of his annoyance at Modi’s rapid rise in the party, has been sidelined with only his seat in the Lok Sabha. And Modi got his confidante Amit Shah appointed by the BJP as president.

The prime minister cannot escape the fact that both power and responsibility now resides squarely with him. Thus, unlike the last two decades, Modi will not have a weak coalition government to blame for any government failures.

Despite his strong political hold at home, the prime minister’s domestic policies have been unremarkable while his foreign policy has exceeded expectations. However, the reality is that at both home and abroad, the break with the past is much less than the breathless anticipation before the BJP’s victory.

To understand why, we need to see the role of deeper, structural factors — internationally and domestically — and go beyond individual actors, no matter how much power has been accumulated at the top.

Indian foreign policy has already stood out under the new government for its verve and foresight. Given India’s at best prickly relations with its closest neighbors, the region can always use a dose of magnanimity from the largest and most powerful country in South Asia. Modi’s grand overture to leaders of the South Asian Association for Regional Cooperation countries by inviting them to his inauguration and giving priority to regional relations couldn’t have kicked off relations better.

It’s another matter that Indo-Pakistan relations and Pakistan Prime Minister Nawaz Sharif are now being held hostage to the army-Islamist-Imran Khan combine in Islamabad. For those who follow their relations, it is another reminder of the role of Pakistan’s entrenched military and its continuing efforts to stem civilian political power, along with its enduring veto power over civilian efforts to improve ties with India.

Not surprisingly, it looks like getting Indo-Pakistan relations to significantly improve will take much more than having strong business friendly governments in both capitals who could have promoted greater economic ties across the border.

The highest marks to the Modi government go to relations with key countries in the broader Asian region — from Japan and China, to Australia, in contrast to the United States. It is important to recognize this did not happen overnight. The diffusion of economic and politico-military power from the US and Western countries to the Indo- Pacific States has been underway for over a decade, brought into stark relief with the 2008 economic meltdown in the United States.

The US has been pre-occupied and drained from its interventions in Iraq and Afghanistan, faces new challenges in Iraq and Syria, and cannot seem to break the stalemate with Iran which could hold the key to stability in the Persian Gulf and Middle East. Internally, the dysfunctional politics between Congress and President Obama has resulted in policy paralysis, more or less.

Meanwhile, a new dynamic has been unfolding in the Indo-Pacific region reflecting the broader structural power shifts, something which the previous United Progressive Alliance government in New Delhi was also clearly cognizant of.

The difference is that under the Modi regime, the tone has shifted from India’s earlier ‘Look East’ to an ‘Act East’ policy — a term that the new Indian foreign minister rolled out at a meeting in Hanoi in August. No doubt this bolder statement of India’s intent — sent strategically from the capital of China’s hostile neighbor Vietnam — grabbed some attention in Beijing.

At the same time, India under Modi seems to have become, in rather short order, much more deft at balancing relations with all the major countries in Asia, and in the process gaining greater strategic flexibility.

This has hardly been a one-way street though. Japanese Prime Minister Shinzo Abe has been actively courting India since he took over in December 2013, harking back to 2007 when he was previously in power and viewed India as a new strategic partner.

Abe had then pushed a Quadrilateral naval exercise consisting of India, Japan, the US and Australia (a so-called Concert of Democracies), causing consternation in China which viewed it as a thinly veiled Asian NATO. After the inaugural event, the exercise was suspended when Australia pulled out under Chinese pressure. (Australia just signed a civil nuclear cooperation agreement to sell uranium to India after two years of negotiations).

Modi’s recent five day visit to Japan has given more heft to the incipient ‘strategic partnership’ established between the two countries in 2009. Japan’s announcement to invest $35 billion in India over five years in Indian infrastructure and Modi’s decision to fast track Japanese investment with a special team in the Prime Minister’s Office to facilitate Japanese foreign direct investment should ensure that implementation actually occurs. Less appreciated is the agreement between the two countries to trade in strategic rare earth materials, something which China now has a monopoly in and which has been buffeted by pricing conflict.

If anything, China has been ahead of Japan in wooing India. Chinese President Xi Jinping was the first foreign leader to call Modi to congratulate him on his electoral victory. He has invited India for the first time to the APEC summit that China is hosting in November, a recognition of India’s rising power in Asia. Xi traveled to New Delhi last week with a large delegation including more than 135 CEOs. India is seen as a huge market for Chinese cash surplus and good return on investment.

Both leaders recognize that Chinese investment in India is critical to allay India’s concern over its ballooning trade deficit with its largest trading partner. Modi and Xi are pragmatists who are highly unlikely to let the festering border issue get in the way of economic relations which have been galloping ahead since the mid-2000s.

The outcome of these fast moving relationships in Asia is that for India, the US is now becoming just first among equals. India’s decision in July to block a World Trade Organization trade facilitation protocol that would affect Indian agricultural subsidies has brought India and the US into a direct conflict of interest.

Though India has increased caps on foreign investment in defense and insurance sectors from 26% to 49%, Washington was expecting much greater liberalization. The much vaunted ‘pivot’ to Asia by the US in late 2011 is receiving mixed reviews in India. It is not clear where additional breakthroughs are going to be made in Indo-US relations when Modi comes calling in Washington.

There is little reason to think that a pragmatic and proactive Modi government cannot maintain steady progress on foreign policy —except for one: The vagaries of domestic politics diverting the government.

Most worrisome in this regard is the growing communal polarization and unrest in India’s largest state of Uttar Pradesh. Independent observers note that competitive communalism in the state is on the rise again, after being relatively quiescent since the early 2000s.

In UP at least, a communal agenda is being revived which is drowning out the development agenda that is ascendant in other parts of the country. It is vital for India that economic development remains the main agenda in both foreign policy and domestic policy.

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