India-US Relations

The 2020 US elections: What’s at stake for India?
When US President Donald Trump visited India in February 2020, he was riding high. The American economy looked healthy, unemployment was low, and the US Senate had just acquitted him of charges of abuse of power and obstruction of Congress.

Just three months later, everything looked different. The global COVID-19 pandemic had resulted in over 100,000 deaths in the United States alone, unemployment had skyrocketed to record levels, and protests triggered by the killing of George Floyd, an African-American man, by Minneapolis police had erupted in over 100 American cities.

The Trump administration’s Free and Open Indo-Pacific strategy, driven largely by a more competitive relationship with China, benefited India in various ways, including in bilateral defence cooperation and higher degrees of strategic coordination.
The dramatic change in just three months illustrates the unpredictable nature of US politics at an unpredictable time for the world, including for India. It will be all the more reason to carefully observe the US presidential and Congressional elections scheduled for November 2020.

The last four years
Trump’s 2016 election victory over Democrat Hillary Clinton threw up a number of uncertainties for India. The first was how closed or open the US would be on matters of trade, immigration, investment, and technology. The second concerned what approach he would adopt to China: confrontation, competition, cooperation, or confusion. This matter was particularly important because it would have had implications for the wider region and the world at large. The third uncertainty was how he would approach the issue of terrorism, particularly with respect to Afghanistan and Pakistan. And the fourth was what priority he would give to international institutions, and what that would mean for Indian membership and activity.

The Trump administration’s overall approach and Indian engagement with Washington helped to ensure that these areas either witnessed intensified cooperation or that damage was mitigated. The Trump administration’s Free and Open Indo-Pacific strategy, driven largely by a more competitive relationship with China, benefited India in various ways, including in bilateral defence cooperation and higher degrees of strategic coordination. The Trump administration decreased barriers for India to receive sensitive technologies, building upon some of the work done in the last two years of the Obama administration. Coordination on multilateral cooperation and Afghanistan improved, although not without bumps on the road. Occasional difficulties did arise with respect to Pakistan, given Washington’s continued equities; on immigration, although radical reform was limited by logjams in the US Congress; and especially on trade, where India was singled out for its high tariffs. Nonetheless, despite squabbling on the terms of commerce, overall two-way trade between India and the US continued to rise throughout the Trump presidency while the trade deficit in India’s favour narrowed.

Trump’s disregard for other countries’ internal affairs meant that the official US response to major changes in India — including the nullification of Article 370, which granted special status to Jammu and Kashmir, and the passage of a contested Citizenship Amendment Act — was relatively muted.

Two other complications arose subsequently. The first was the Trump administration’s hardening attitude to Iran, beginning with his unilateral withdrawal from the nuclear agreement concluded by his predecessor Barack Obama: the Joint Comprehensive Plan of Action (JCPOA). The renewal of US sanctions on Iran had implications for Indian energy security. The second complication involved attempts led by the US Congress to constrain Trump’s ability to engage with Russia. The resulting legislation, known as Countering American Adversaries through Sanctions Act (CAATSA) threatened sanctions on countries for major defence agreements with Russia. India, as the largest foreign recipient of Russian defence exports, initially looked like a probable target. At the same time, Trump’s disregard for other countries’ internal affairs meant that the official US response to major changes in India — including the nullification of Article 370, which granted special status to Jammu and Kashmir, and the passage of a contested Citizenship Amendment Act — was relatively muted.

Essentially, Trump’s election had a significant impact on nine issues of importance for India. All will in some sense be at stake in November 2020. On the strategic side, this involved US policy towards China, Russia, Afghanistan/Pakistan, and Iran/Middle East. In terms of bilateral relations, the primary issues relate to trade, immigration, investment, technology, and values.

Republican vs Democratic priorities
A Joe Biden victory would provide relief to India in several areas. Not only would there be more structure and stability to a Biden administration, but the Trump administration’s obsession with redressing trade deficits, curtailing legal and illegal immigration, and isolating Iran will no longer factor prominently in US policy. Indeed, a second Trump administration will likely redouble its efforts to stem immigration, rebalance trade, and harden its stance on Iran, all of which would contribute further to Indian discomfort. Furthermore, a Democratic presidency will put one important but dormant area of cooperation — on climate change, green energy, and sustainability — back on the table with India.

By contrast, other issues might become more of a concern to the present government in New Delhi in the event of a Democratic win. Depending on who occupies key positions in the executive branch of government, we may see under a Joe Biden presidency a return to a more even-handed policy between India and Pakistan in South Asia, although not perhaps to the same degree as the 1990s and early 2000s. A Biden administration, with advocacy from the left wing of the Democratic Party, will also likely be more vocal in its criticism of India for such steps as nullifying Article 370 and CAA.

Not only would there be more structure and stability to a Biden administration, but the Trump administration’s obsession with redressing trade deficits, curtailing legal and illegal immigration, and isolating Iran will no longer factor prominently in US policy.

On other issues — such as investment flows and technology sharing — the consequences of the 2020 presidential elections for India will be less clear-cut. Of these, US policy on China will be by far the most consequential. Trump triggered a trade war that caught Beijing by surprise. Beyond trade, his administration has taken other aggressive steps towards decoupling the US and Chinese economies, including steps on students and technology. At the same time, his withdrawal from the Trans-Pacific Partnership and defunding of the World Health Organisation have been criticised as counter-productive. Democrats have also criticized his administration for cutting spending in areas, such as scientific research and development, that would enable the US to better compete with China. While the bipartisan consensus on China as a competitor has grown in the US, there remain differences between the parties as to how best to compete.

Furthermore, constituencies outside the national security, human rights, and intelligence communities — such as those tasked with the economy or the environment — are still likely to advocate engagement and cooperation with Beijing.
Consequently, either a Trump or a Biden electoral victory in November will present the Indian government with both opportunities and difficulties. Despite a good rapport with Trump, who was favourably impressed by his visit to India, difficulties on immigration should be anticipated in the event of his reelection. While Biden will provide greater clarity and bring stability to US policy, a return to more traditional approaches to certain issues with respect to India is possible.

Prediction is premature
Predicting a US presidential election more than three months out is unwise. It is almost certain that Biden will win the popular vote, given Trump’s approval ratings and the fact that Democratic candidates have done so in six of the past seven presidential elections. Winning the Electoral College, which is what really counts, is another matter. The US presidency will be decided by no more than 17 of the 50 US states, and perhaps as few as seven. Trump will hope to retain traditionally Republican strongholds such as Arizona, Georgia, and North Carolina; win swing states such as Florida and Ohio; and surprise in at least one of the traditionally Democratic states that he won in 2016: Pennsylvania, Michigan, or Wisconsin.

It is almost certain that Biden will win the popular vote, given Trump’s approval ratings and the fact that Democratic candidates have done so in six of the past seven presidential elections.

Traditionally, incumbent presidents have had an edge in what are otherwise level contests between Republican and Democratic nominees, but the past three elections have thrown up uncertainty. In 2008, Republican John McCain was leading comfortably in polls in August, before the financial crisis of September benefited Democrat Barack Obama. In 2012, Obama enjoyed a comfortable lead that Republican Mitt Romney narrowed following a strong performance in their first debate. In 2016, the polls indicated a Hillary Clinton victory until election day in November. These recent trends suggest that anticipating the outcome of the presidential race before the two parties hold their conventions later this year would be premature.

Don’t forget Congress
Finally, amid the attention focused on presidency, it is often forgotten that the US Congress is also witnessing elections in November. All seats in the House of Representatives are being contested, as they are every two years, with Democrats expected to retain control of that chamber.

The contest for the Senate will, however, be significant. Should Democrats win six of seven closely contested races (Arizona, Colorado, Maine, Michigan, Montana, North Carolina, and Georgia) they would claim a majority in the upper house of the US Congress. This will give the Democrats an opportunity to define the legislative agenda (given control of both chambers), block Trump’s nominations for Supreme Court justices (should he be reelected), and put pressure on Trump in the event of another Congressional investigation into presidential wrongdoing.

For India, the Congressional relationship will remain important given the ability of the US legislature to facilitate or veto important policy. Traditionally, Congress has played a moderating role for India. When relations with the US were frosty, as during the 1980s or after the 1998 nuclear tests, India found advocates for the relationship in Congress. At the same time, when relations were more amicable, Congress often struck a more skeptical note, as when George W. Bush offered a civilian nuclear agreement to India. Regardless, this year’s Congressional elections — particularly the finely-balanced Senate — will matter almost as much for Indian interests as the presidential election.
 
Future of India-US defence ties
One critical aspect of the India-US bilateral relationship has been defence ties. The hiccups in this particular sector illustrate the different priorities and worldviews the two countries have of defence and consequently why the bilateral relationship will never progress beyond the current point.

India, for the longest time, viewed its “eclectic” defence purchases as a smart move. The standard explanation was we were “multi-sourcing” so as to wear off the effects of any sanctions, interruptions in spare parts supply and any medium gestation design flaws. This of course was relevant when India was a heavily sanctioned country. Technologically too, this made perfect sense. After all in a Russian plane, with a reasonable level of metallurgy, you could latch on an American pod mounted gun and run a wire through to the cockpit. This was after all the time when all phones—be they American, German, French, Russian, Chinese or North Korean—were the same and could be used interchangeably. When the first push button landlines came in it became a bit more complex between “pulse and tone” phones and even there, phones started being made where you could switch between pulse and tone.

Today, India is not sanctioned and jerry rigging heavy parts of metal does not constitute the cutting edge of technology. America has moved on, but India is still stuck in a time warp, be it on technology, the nature of technology and its linkage to industrial systems or the very nature of the defence trade. How do we know this? Very simple, from the crude terminology we use, one can figure out how arcane our understanding of the evolution of technology and business is.

The very fact we use terms like “technology transfer”, “original equipment manufacturer (OEM)” and “offset” not only makes us the laughing stock of the international defence trade, it also shows we are simply incapable of absorbing transferred technology, manufacturing it or getting any serious “offsets”. The problem starts with our industrial structure itself. In India HAL etc., want to manufacture everything to do with a plane. In the West, the hyper specialisation of technology means that almost every single part is manufactured by a different MSME company. The size of these companies (unlike India) is not dictated by government fiat, but rather by the rate of replacement of what they produce. This is why technology changes so rapidly that every year’s iPhone iteration represents a substantial leap over the previous years. Note, Apple does not manufacture these, they source it from thousands of different manufacturers (including arch-rivals Samsung) and they merely do the technology and software design and interfacing. Similarly, in the 1970s, Boeing used to manufacture over 80% of its own aircraft. Today, Boeing is lucky if it manufactures even 20% of its commercial aviation flagship, the 787 Dreamliner.

In such a context, “technology transfer (TOT)” and “OEM” make no sense. As shown above the “OEM” owns only 20-25% of the final product. At best they are a brander and integrator, but our persistence with this terminology means we can’t execute the kind of sub-deals required for an in depth transfer of technology. The word ToT is even more dangerous. Because our MSMEs simply aren’t as developed, we don’t have the industrial depth or breadth to be able to absorb the vast scope of technologies that get transferred. India’s arcane tech education system means that most of these sciences aren’t even taught in India. Further, each of these US MSMEs have their own patent and IPR policies, which means they will not be willing to share and legal protections in the US are so strong, that the government cannot force them to share either. In case some of the technologies are shared, they make no sense for private companies to absorb, because all these technologies remain commercially viable only if they can be leveraged into civilian uses. The lack of negotiating “work share agreements” (as opposed to the “offsets” we negotiate) burdens the private sector with technologies it cannot use and sell without appropriate workshare agreements and re-selling and competition rights. In short, most of the technology is private and not up for sale; what is up for sale, we cannot absorb intellectually or industrially and we certainly cannot do either in a commercially viable way.

Now contrast this with the way the US thinks about defence-technology. In many ways this is like functioning in an Apple ecosystem—your Mac desktop synchronises perfectly with your Mac laptop, iPad and iPhone. Using an Android in this environment you can still get the job done, but not with the enormous efficiency that a full Mac ecosystem provides you. This is what modern defence is about—not the kinetics of a weapons system, but rather its networking and data sharing technology based on an enormous pile of highly accurate intelligence gathering. In that sense, when the US sees an F-35 they see it merely as the tip of an iceberg—a complex network of systems working together to make the F-35 invincible. This iceberg includes real time data gathered by drones, AWACS aircraft, electronic and image intelligence gathering assets including satellites. This data is then fused together to make it comprehensible and transmitted to the plane and it is this data that enables the F-35 to see the enemy further out, understand his actions, his tactics and his escape routes and shoot him down before the enemy even knows what has happened.

When the UK or Singapore sees the F-35, they understand this and they know that by joining the programme, the amount of commercial contracts they get related to the F-35 will more than adequately compensate their investment in the platform through global sales. But when an Indian sees the F-35, all he looks at is a shiny stand-alone gadget, not merely as one piece in a jigsaw. He sees it as wasteful purchase like a kitty party aunty buying a BMW, rather than as an investment as a shopkeeper would in a scooter, the home delivery revenues more than compensating his initial investment.

This then is the conundrum that India-US ties are stuck in. What the US is offering India doesn’t understand. The problem is one of comprehension, it is a problem of the incompatibility of first world and third world. The answer doesn’t lie in tinkering with documents like treaties and defence procurement procedures, rather it lies in educating India’s military thinkers outside their silo into the sectors of education, industrial policy and such. Till then the bilateral defence relationship will remain where it has been—stuck in a plateau.
 

Pls note. Not that you're doing too badly. After all it's more important to establish Riyaasat e Medina.

@safriz ; @Arsalan123
everything written in the document is absolutely correct.i have seen Indians sharing knowledge.they don't hide knowledge and share it. in pakistan, people hide knowledge.they don't want to see others in good positions.this is my personal experience. there are good educated people here as well but they are very few. complete credit to india for their best education and giving better life to it's citizens specially electricity,water etc. many Pakistanis are also in united states but Indians are far ahead.i heard that Pakistanis are in NASA but i know Indians are also there. great job well done. united states is the most educated country and superpower. i remember one of your engineer tested Tesla car recently.great achievement.

Yes this CSS obsession is correct. everyone wants government jobs,big black cars with security guard and protocol on road.this culture has destroyed us. corrupt people sitting in important positions.anyway this document is for the youth of Pakistan. They should open their eyes.i don't mind watching ertugul. you can follow religion and science simultaneously.example is turkey,mostly secular but still believes in religion. they upgraded our f-16s. just think about Turkish engineers. look at Israel and how easily they are making their own weapons. there are many examples. it's time to learn. i said several times on other forum that we have to adopt good things of India like the progress of India in satellite engineering.
 
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everything written in the document is absolutely correct.i have seen indians sharing knowledge.they don't hide knowledge and share it. in pakistan, people hide knowledge.they don't want to see others in good positions.this is my personal experience. there are good educated people here as well but they are very few. complete credit to india for their best education and giving better life to it's citizens specially electricity,water etc. many pakistanis are also in united states but indians are far ahead.i heard that pakistanis are in nasa but i know,indians are also there. great job well done. united states is the most educated country and superpower. i remember one of your engineer tested tesla car recently.great achievement.
What you say is partially correct. Behavior wise ppl are no diffrnt on either side of the border. Only thing is we have more institutions that were developed over period of time. Knowledge sharing or preference for ppl like themselves based on community,regions,language is still strongly prevalent among Indians.

Just observe each society how they propagate skill from generation to another generation for example culturally music or singing is mostly done hereditary wise or among the same community. It will be pretty hard for others to break into that field. This virtually leads to lack of diversity in skill for that area and also leads to degradation over period of time it is similar to inbreeding.
 
What you say is partially correct. Behavior wise ppl are no diffrnt on either side of the border. Only thing is we have more institutions that were developed over period of time. Knowledge sharing or preference for ppl like themselves based on community,regions,language is still strongly prevalent among Indians.

Just observe each society how they propagate skill from generation to another generation for example culturally music or singing is mostly done hereditary wise or among the same community. It will be pretty hard for others to break into that field. This virtually leads to lack of diversity in skill for that area and also leads to degradation over period of time it is similar to inbreeding.
today Indian can teach you everything.from aerodynamics to poem classes,literally everything.we don't have this type of people in Pakistan. even if they have knowledge,they don't share. my friend is in Dubai. he is CCNP and his boss is an Indian lol. there are so many Indians in Dubai as well. they are everywhere,corruption has destroyed us.we also wanted to see our people prosperous. we can't even speak English properly. look at my English. it's intermediate level English,not advanced level English. it's so sad.i hope someday someone will change Pakistan too and i hope for our progress. corruption is evil. it kills merit. it is the reason of unemployment. it's the reason for hunger.people even sleep without food on streets in Karachi. very rare but true.
 
today Indian can teach you everything.from aerodynamics to poem classes,literally everything.we don't have this type of people in Pakistan. even if they have knowledge,they don't share. my friend is in Dubai. he is CCNP and his boss is an Indian lol. there are so many Indians in Dubai as well. they are everywhere,corruption has destroyed us.we also wanted to see our people prosperous. we can't even speak English properly. look at my English. it's intermediate level English,not advanced level English. it's so sad.i hope someday someone will change Pakistan too and i hope for our progress. corruption is evil. it kills merit. it is the reason of unemployment. it's the reason for hunger.people even sleep without food on streets in Karachi. very rare but true.
English doesn't measure progress, doesn't matter if u can't speak fluently because its not your native tongue. Yes English is a global language so learning it is essential but not mandatory... Even we Indians suffer from same inferiority complex viz viz English. A bad English speaker is mocked and ridiculed.
Look at Chinese , Germans , Italians, French they are proud of their mother tongue and have made it mandatory for foreigners who wish to study there....
 
today Indian can teach you everything.from aerodynamics to poem classes,literally everything.we don't have this type of people in Pakistan. even if they have knowledge,they don't share. my friend is in Dubai. he is CCNP and his boss is an Indian lol. there are so many Indians in Dubai as well. they are everywhere,corruption has destroyed us.we also wanted to see our people prosperous. we can't even speak English properly. look at my English. it's intermediate level English,not advanced level English. it's so sad.i hope someday someone will change Pakistan too and i hope for our progress. corruption is evil. it kills merit. it is the reason of unemployment. it's the reason for hunger.people even sleep without food on streets in Karachi. very rare but true.
As @Deathstar says , english is certainly not a measure of progress it is only a medium of communication. Most of us can express optimally in our mother tongue and that should be the medium of communication to begin with. Taking away that advantage and inducing an artificial foreign medium of communication will only make ppl spend more time on mastering communication rather than think critically. By using a foreign medium of commn we are actually denying a lot many deserving ppl an opportunity to contribute to society or science. Take for example mathematics you dont need to be a master of english but being creative & good in solving problems is gud enuf. English is just our self imposed shackles , if we start thinking better than them then they will start learning our language to gain more knowledge.
 
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Joint Statement on U.S.-India Strategy Energy Partnership
In the midst of a global pandemic with an enormous human toll that is also affecting energy demand, global energy markets, and sustainable energy growth, the U.S.-India Comprehensive Global Strategic Partnership has never been more vital. Today, U.S. Secretary of Energy Dan Brouillette and Indian Minister of Petroleum and Natural Gas and Minister of Steel Dharmendra Pradhan co-chaired a virtual ministerial meeting of the U.S.-India Strategic Energy Partnership (SEP) to review progress, highlight major accomplishments, and prioritize new areas for cooperation.

Established in April 2018 at the direction of President Donald J. Trump and Prime Minister Narendra Modi, recognizing the strategic importance of energy to the U.S.-India bilateral relationship, the SEP builds upon our longstanding energy partnership and sets the stage for meaningful engagements through robust government-to-government cooperation and industry engagement.

The United States and India share an all-of-the-above approach to energy security and energy access. The SEP organizes inter-agency engagement on both sides across four primary pillars of cooperation: (1) Power and Energy Efficiency; (2) Oil and Gas; (3) Renewable Energy; and (4) Sustainable Growth. Through these pillars, the United States and India are working to strengthen and modernize the power grid and distribution utilities for clean, affordable, and reliable energy access; improve efficiency, flexibility, and environmental performance in the power sector; promote inclusive and sustainable economic growth through long-term energy development; enhance energy security through oil and gas trade, and infrastructure investment; advance the development, deployment, and integration of renewable energy and expand access to finance for renewable energy projects; and reduce market barriers to energy trade and investment. The SEP also supports USG efforts under the AsiaEDGE initiative, which establishes India as a strong energy partner in the Indo-Pacific region.

The two countries are also leading joint research and development (R&D) through the U.S.-India Partnership to Advance Clean Energy-Research (PACE-R) on smart grids and energy storage to increase resilience and reliability of the electric grid. Today, they announced new areas of research on transformational power generation based on supercritical CO2 (sCO2) power cycles and advanced coal technologies for power generation and hydrogen production, including carbon capture, utilization, and storage (CCUS). The United States briefed about continued bilateral R&D engagement on advanced civil nuclear energy technologies through the U.S.-India Civil Nuclear Energy Working Group.

Ministerial Outcomes
The sides announced a number of achievements and priorities for new work under the SEP.

Enhancing Energy Security
The sides signed a Memorandum of Understanding (MOU) to begin cooperation on Strategic Petroleum Reserves operation and maintenance, including exchange of information and best practices. They also discussed the possibility of India storing oil in the U.S. Strategic Petroleum Reserve to increase their nation’s strategic oil stockpile.

Harnessing Innovation
The sides launched a public-private Hydrogen Task Force to help scale up technologies to produce hydrogen from renewable energy and fossil fuel sources and to bring down the cost of deployment for enhanced energy security and resiliency. They also signed an MOU to collaborate on India’s first-ever Solar Decathlon® India in 2021, establishing a collegiate competition to prepare the next generation of building professionals to design and build high efficiency buildings powered by renewables. The sides jointly launched collaboration between the U.S. DOE National labs and the Indian National Institutes under the Ministry of New & Renewable Energy as part of the newly launched South Asia Group for Energy (SAGE), supported by USAID, for joint research on development and deployment of advanced clean technologies.

The sides also agreed to explore possible cooperation through joint activities and information exchange on sustainable biofuel production and use, in particular, bioethanol, renewable diesel, other advanced biofuels, and discussion on possible developments in sustainable biofuels for air and sea transport. The sides also discussed information exchange in regard to policies and regulations, and other related areas of interest. Another potential area of cooperation is the promotion of bilateral investments in the private sector. The sides will also explore cooperation on utilizing the economic value of converting bio-waste into biogas.

Modernizing the Power System
As India pursues its ambitious renewable energy targets and seeks to transform its energy sector, the sides are collaborating on the deployment and integration of renewable energy and new technologies into the grid; modernizing the power distribution sector; supporting state-level planning for renewable energy; deploying distributed energy technologies, electric vehicles, rooftop solar, and battery storage; redesigning markets, and increasing off-grid energy access. The two sides have been collaborating to modernize Distribution Sector through various reform measures for achieving reliable quality 24X7 power supply through increased private participation; enhancing consumer centricity; deployment of Smart Meters across India; and, establishing Smart Grid Knowledge Centre in India as a “Global Centre of Excellence” for Smart Grids. USAID and the U.S. International Development Finance Corporation are developing a concept to establish a new $25-million credit guarantee for the Small and Medium Enterprise sector to deploy rooftop solar.

Work is also underway to enhance flexible operations of coal power plants needed to address increased renewable energy penetration and variable power demand to minimize operating costs and failure risks. The sides agreed to collaborate on advanced high-efficiency coal technologies with low-to-zero emissions through carbon capture, utilization, and storage (CCUS), focusing on USDOE’s Coal FIRST (Flexible, Innovative, Resilient, Small, Transformative) initiative to develop 21st Century coal energy systems.

New areas of technical cooperation include application of renewable energy in the economic sectors; development of new business models and decision-making tools for renewable energy; skill building and training programs; and adoption of emerging digital technologies and advanced IT management tools to enhance cyber security of renewable energy systems.

Enhancing Energy Efficiency and Conservation
The United States and India have been working to enhance building and appliance efficiency through enhanced building codes, design and operation of smart buildings of the future, smart meters and demand side response, as well as retrofit of buildings to improve building performance, promote energy conservation, and improve indoor air quality. The sides have also been working towards development of behavioral energy efficiency program and technical assistance for a distributed energy resources plan. The sides are also working to enhance energy efficiency in the industrial sector and will work to advance a comprehensive energy management system in accordance with ISO50001.In response to the COVID-19 pandemic, USAID and Energy Efficiency Services Ltd (EESL) jointly initiated a new activity, “Retrofit of Air Conditioning to Improve Air Quality for Safety and Efficiency” (RAISE) for healthy and energy efficient buildings. The initiative will be scaled in public sector buildings

Promoting Energy Trade and Investment
The sides noted the significant increase in bilateral hydrocarbon trade since the establishment of SEP, with the bilateral hydrocarbon trade touching US$ 9.2 billion during 2019-20, marking a 93% increase since 2017-18, and affirmed to promote greater hydrocarbon trade between the two countries.

Through the U.S.-India Natural Gas Task Force, U.S. and Indian industry forged new commercial partnerships on innovative projects and developed a series of policy and regulatory recommendations to support the Government of India’s vision to increase the share of natural gas in India’s energy sector. The sides have also held numerous public-private dialogues to provide industry perspectives on challenges and opportunities to trade and investment across the energy sector.

The sides took note of their governments’ strong commitment to advance our civil nuclear cooperation, and welcomed recent progress on the Westinghouse commercial reactor project at Kovvada, which represents an important milestone in our strategic relationship.

The two sides agreed to support each other’s vision of national development in the energy sector and encourage investment, including sharing a list of potential projects in which the companies from both sides can be encouraged to invest.

Promoting Inclusive and Sustainable Economic Growth
The sides are working to enhance long-term energy development and plans and strategies through adoption of best practices and methodologies in energy data management; capacity building in energy modeling and promotion of low carbon technologies. Think tanks, policy researchers, NGOs and Government agencies from India would be collaborating with DOE National Labs and respective U.S. Government and private agencies to facilitate above exercise. USAID and NITI Aayog jointly launched the India Energy Modeling Forum to build a network of modeling community and its linkage with Government for analytical work and policy making exercise.

Empowering Women in the Energy Sector
Recognizing the need for a more balanced workforce with diverse skill sets to support energy innovation and address critical energy challenges of the future, the Ministers committed to addressing gender diversity, gender mainstreaming, and promoting women’s entrepreneurship across the energy sector through the SEP platform. USAID launched the South Asia Women in Energy (SAWIE) platform focused on the power sector and the sides are working to incorporate gender-focused activities across the technical pillars.

Strategic Energy Partnership teams will convene again in the near future to further develop action plans for the respective pillars of cooperation. The next Ministerial meeting will be held in 2021.

*****

ADDENDUM

The following agreements and partnerships were announced under the U.S.-India Strategic Energy Partnership (SEP) dialogue to advance the strategic and economic interests of both countries:
  • MOU between the U.S. Department of Energy and the Indian Ministry of Petroleum and Natural Gas concerning cooperation on Strategic Petroleum Reserves.
  • MOU between the U.S. Agency for International Development (USAID) with Indian Society of Heating Refrigeration and Air Conditioners (ISHRAE) for professional skill development for practitioners on energy-efficient design of air conditioning systems.
  • MOU between EESL, NTPC, and USAID for retrofit of buildings to improve indoor air quality, safety, and efficiency.
  • USAID announced partnership with Power System Operation Corporation (POSOCO) to develop India’s National Open Access Registry (NOAR).
  • Statement of Intent between the U.S. Department of State and India’s Ministry of Power under the Flexible Resources Initiative of the U.S.-India Clean Energy Finance Task Force to enhance the flexibility and robustness of India's grid to support the country's energy transition and mobilize the private investment to deliver reliable, low-cost power for the people of India.
  • The Federal Energy Regulatory Commission (USA) and the Central Electricity Regulatory Commission in India are working to conclude an agreement to share best practices for regulating electricity and developing electricity markets.
  • The U.S. Department of Commerce launched an Energy Industry Working Group for India under the Asia EDGE initiative to facilitate private sector connections and ideas for U.S.-India energy cooperation, including on innovative and disruptive technologies.
  • USTDA is supporting energy access and efficiency in India through recently funded projects to implement virtual pipeline infrastructure with Arush Gas Technology Services (AGTS) and carbon capture and utilization technologies in refineries with Indian Oil Corporation Limited (IOCL).
  • Release of a “Strategic Roadmap of Smart Grid Knowledge Centre to become a “Global Centre of Excellence in Smart Grids” at an industry round table held on the sidelines of the Power and Energy Efficiency pillar meeting, sponsored by the Ministry of Power of India and USAID.
Under the U.S.-India Gas Task Force:
  • MOU between the Federal Energy Regulatory Commission (FERC) and Petroleum Natural Gas Regulatory Board (PNGRB) on information exchange in oil & gas regulatory frameworks.
  • MOU between Bloom Energy and Indian Oil on fuel cell technology.
  • Letter of Cooperation among ExxonMobil, Chart Industries IOCL on stimulating LNG demand through a virtual pipeline network and manufacturing and use of ISO containers in India.
  • MOU between Agility Fuel Solutions LLC and Indrapastha Gas Limited (IGL) to explore the viability, usefulness, and feasibility of advanced clean fuel systems including Type IV cylinders in India.
  • MOU between Gasway USA, Inc. and Indrapastha Gas Limited (IGL) to explore the feasibility of a pilot virtual gas pipeline project.
  • ExxonMobil and GAIL have made significant progress on the MOU they signed in 2019 to enhance India’s natural gas access and are engaged in a commercial dialogue to advance LNG as fuel in heavy commercial vehicles.
 
China common worry, India and US step up military, intel ties
India and the US have intensified intelligence and military collaboration and cooperation at an unprecedented level, more so in the last month.

The two countries have been working quietly to step up information sharing amid the tense military standoff between Indian and Chinese troops — it has been on for 11 weeks now — along the Line of Actual Control in Ladakh.

After US Secretary of State Michael R Pompeo spoke to External Affairs Minister S Jaishankar in the third week of June, at least two high-level phone conversations, key to this cooperation, have taken place.

The Indian Express has learnt that National Security Advisor Ajit Doval spoke to US counterpart Robert C O’Brien while Chairman of the Joint Chiefs of Staff General Mark A Milley and Chief of Defence Staff General Bipin Rawat have had a conversation in the last few weeks.

These conversations have facilitated information-sharing between security, military and intelligence branches of the two countries.

On Monday, the USS Nimitz and warships of the Indian Navy conducted exercises designed to maximise training and interoperability, including air defence. The Nimitz Carrier Strike Group, the US Navy said, is currently deployed in the Indian Ocean in support of a free and open Indo-Pacific.

Sources said the phone conversation between Pompeo and Jaishankar really set the stage and gave a political push to the already existing security cooperation apparatus in place. Also, Defence Secretary Mark T Esper had called up Defence Minister Rajnath Singh in the second week of July.

The cooperation includes sharing of high-end satellite images, telephone intercepts, and data sharing of Chinese troops and weapons deployment along the entire stretch of the Line of Actual Control. New Delhi, sources said, is watching Chinese movements in “all sectors” of the LAC.

US equipment too has enhanced the capability of the Indian defence establishment. The Indian armed forces are using at least five American platforms in eastern Ladakh: C-17 Globemaster III for military transport, Chinook CH-47 helicopters in the heavy-lift category, the AH-64E Apache attack helicopters which also provide combat cover Army strike corps, P-8I Poseidon for overland reconnaissance, and the C-130J Super Hercules which are essentially tactical airlift transport and special operations aircraft.

On July 5, The Indian Express reported that Pompeo had spoken to Jaishankar after the incident in Galwan Valley where 20 Indian Army personnel were killed in clashes with Chinese troops.

Indian and the US did not make the call public for “strategic reasons” since Delhi and Beijing were engaged in diplomatic and military talks around that time.
 
India Ideas Summit | India, U.S. negotiating UAV co-development programme: Pentagon official
The U.S. and India are negotiating a co-development programme for the air-launched unmanned aerial vehicle (UAV), a top Pentagon official has said.

Addressing the India Ideas Summit organised by the U.S.-India Business Council on July 22, the top Pentagon official said that the U.S. Air Force research labs have signed a cooperative research and development agreement with an Indian startup to support the development of the air-launched UAV.

“I would like to highlight a very exciting project we are currently negotiating — air-launched unmanned aerial vehicle or UAV will be a co-development programme between the U.S. Air Force Research Labs, the Indian Air Force, India’s Defence Research and Development Organisation, and an Indian start-up company,” said Ellen M. Lord, Under Secretary of Defence for Acquisition and Sustainment.

The Pentagon’s point person for the ambitious U.S.-India Defence Technology and Trade Initiative (DTTI), Ms. Lord said that they were planning to hold the next DTTI group meeting in the week of September 14 and the second meeting of the DTTI industrial collaboration forum the week before.

Often described as the Pentagon’s chief weapons buyer, Ms. Lord said that the U.S.-India defence cooperation has made great strides in the last few years.

This cooperation has led to closer relationships between the two governments and also increased stability in the Indo-Pacific region.

Noting that U.S. defence sales to India have grown exponentially over the last 10 years, she said the U.S. is striving to become India’s first choice in defence solutions.

The last year has seen many firsts in DTTI, she said, adding that the first project agreement for co-development is in negotiation.

The first industrial cooperation forum was held, she said. She also announced the release of the industrial guidance for the participation with DTTI.

“The industrial cooperation is a key focus area for the future of defence collaboration and we think that this industry guidance will increase industrial collaboration within the DDTI framework,” she said.

“The United States welcomes any partnership that enhances U.S. national security objectives, decreases defence procurement costs and leads to greater supply chain stability,” Ms. Lord said.

Noting that the U.S. government reviewed and commented on India’s defence procurement procedure or DPP, Ms. Lord said they were encouraged to see the procedures for loans and leases added.

The United States is aware that many countries, including India, use offset in defence sales. The U.S. government will not take part in any negotiation concerning offsets between the industry and a foreign government.
“We encourage all governments to ensure that offset processes are transparent and applied equally to all competitors,” Ms. Lord said.
 
India-US ‘limited’ deal to cover just 15% of trade – Details
India and the US have inched closer towards hammering out a “limited” deal that could cover annual trade of over $13 billion, or roughly 15% of bilateral shipment, which also includes a complete restoration of duty benefits for New Delhi under the so-called Generalised System of Preferences (GSP).

However, if an agreement is reached quickly on widening the coverage, the initial deal could take the shape of a preferential trade agreement, amounting to a much higher value of annual trade.

India may consider opening up its dairy and poultry sectors partially if it gets a good deal from the US in textiles and garment and pharmaceuticals. In garments, for instance, the US import duties (for India) currently range between 16.5% and 32%.

This deal is expected to be almost evenly balanced in terms of trading value for both the partners and could be followed by talks on a potential free trade agreement (FTA).

As part of the limited deal, India will likely reduce tariffs on high-end bikes like Harley Davidson, pledge greater market access in farm products, including cherry, and sweeten its initial offer on easing price caps in medical equipment, a source told FE. India is willing to apply trade margin on coronary stents and knee implants at the first point of sale (price to stockiest), instead of imposing it on the landed prices, as was proposed by it initially, to make it more attractive for American companies like Abott.

India is also willing to resolve certain non-tariff measures such as certification process for some dairy products and market access in alfalfa hay and pork.

Commerce and industry minister Piyush Goyal last week suggested that both India and the US could clinch a quick trade deal. “We should be able to get the quick trade deal out of the way after a few more calls. India and the US must sit down to negotiate a robust FTA but before that we can even look at an early harvest trade agreement for 50-100 products,” Goyal said.

If the US agrees to roll back its extra tariff of 25% on Indian steel and 10% on aluminium, New Delhi will lift retaliatory steps and scrap punitive duties on 29 American goods, including farm items like almond, apple and walnut. This is expected to augur well for the Trump administration before the presidential elections in November.

However, negotiations on the American demand for India to scrap duties on seven ICT products, including high-end phones and smartwatches, are yet to be concluded, the source said. New Delhi had earlier expressed its inability to abolish the tariff on such products on grounds that it would only benefit third parties with far greater share in supplies to India (like China) than the US. Also, New Delhi had estimated that any such move would mean a potential customs revenue loss of $3.2 billion or more a year. Instead, India offered to trim tariffs on those ICT products which could potentially benefit the US more, without causing it such a big revenue loss.

The restoration of GSP benefits will mean dutyfree Indian supplies of over $6 billion a year (the tariff forgone for the US was $240 million in 2018).

The US has been pressing India to abolish/cut “not justified” tariff on motorcycles (50%), automobiles (60%) and alcoholic beverages (150%). It is seeking better trade balance with India through greater market access in agriculture and dairy products.

Stringent US patent protection laws and various steps by the Food and Drug Administration (FDA) have dented India’s exports of pharmaceutical products. This is among the important non-tariff barriers that India wants the US to remove.

The “limited deal” was earlier expected to be announced after Prime Minister Narendra Modi’s meeting with US President Donald Trump in New York on September 24 last year. However, differences over certain sticky issues caused the delay.

India’s trade surplus with the US has been shrinking, as it has stated importing oil and gas from the largest economy, something that India has been highlighting.

According to the US government data, New Delhi’s trade surplus with Washington eased to $24.3 billion in 2016 to $23.3 billion in 2019. According to the Indian government data, imports from the US stood at $35.7 billion in FY20, up 0.3% even though overall merchandise imports dropped by 7.8%. Key purchases include mineral fuels and related items ($8.3 billion), gem and jewellery ($6.2 billion) and capital goods ($4.7 billion). India’s goods exports to the US stood at $53 billion, up 1.3% from a year before. Major exported product segments include gem & jewellery ($9.3 billion), pharmaceuticals ($6.3 billion) and garments ($4.2 billion).
 
India, US set to hold 2+2 talks, defence cooperation pact likely on agenda amid LAC standoff
New Delhi: Amid the ongoing standoff between India and China in the Ladakh sector of the Line of Actual Control (LAC), New Delhi and Washington will be holding their first virtual 2+2 format dialogue between foreign and defence ministries in September, ThePrint has learnt.

The plan to hold the 2+2 ministerial meeting through videoconferencing has been in the works since July even as tensions between New Delhi and Beijing have intensified with talks of disengagement between Indian and Chinese troops making no headway, sources said.

This round of the 2+2 talks will be led by External Affairs Minister S. Jaishankar and Defence Minister Rajnath Singh from the Indian side, while the US will be represented by Secretary of State Mike Pompeo and Defence Secretary Mark Esper.

During this round, the two sides might finally sign the last of the US’ defence foundational pacts — Basic Exchange and Cooperation Agreement (BECA). The pact will enable India to avail US expertise on geospatial intelligence and sharpen the accuracy of weapons and automated hardware systems used for military purposes.

The draft agreement on BECA was prepped and readied in March this year in Washington. But the process of finalising it got delayed due to the coronavirus pandemic, said the sources.

“The 2+2 this time will be taking place under very different circumstances. The world then when the last 2+2 meeting took place and the world now are very different places. We expect the Indo-Pacific construct and the Quad framework to strengthen further after this round of 2+2 talks, BECA is also on the agenda,” a senior official, who didn’t wish to be named, told ThePrint.

The other agreements
India and the US have already signed some of the key US foundational pacts — Logistics Exchange Memorandum of Agreement (LEMOA) and Communications Compatibility and Security Agreement (COMCASA) — to deepen defence and strategic ties.

During the last 2+2 meeting, which was held last December in Washington DC, both sides signed the Industrial Security Annex (ISA) to the India-US General Security of Military Information Agreement (GSOMIA) that eased transfer of high-level technology from the US to India and safeguarding of classified military information.

The ISA also seeks to ease participation of American defence firms in ‘Make in India’ projects via the India-US Defence Technology and Trade Initiative (DTTI) that was established in 2012.

India will be holding the talks at a time when the US is headed for a fierce presidential election in November.

“It’s certainly the right time to convene the next 2+2 session… To be sure, the upcoming US election may put a damper on the meeting, given that this may be the last time India sees the Trump administration on the other side of the table in the 2+2,” said Michael Kugelman, deputy director of the Asia Programme at the Wilson Center in Washington.

“But given the bipartisan support in Washington for US-India partnership, a potential change of power shouldn’t be concerning,” said Kugelman.

“There’s much that could be on the agenda — how to make progress on finalising BECA, the last remaining foundational agreement, what can be done with the Quad, how to scale up technology transfers and intelligence sharing, and so on,” he added.

‘LAC tensions to feature prominently’
The upcoming round of 2+2 meeting will be also taking place at a critical juncture, months after India witnessed a violent face-off with China for the first time in the last 45 years. While India lost 20 soldiers in the clash, the Xi Jinping administration didn’t reveal the Chinese casualties.

The Trump administration has called out China several times for the LAC incident in support of India. The Joe Biden camp recently said it will work with India for a rule-based Indo-Pacific and won’t allow China to threaten its neighbours.

“The China-India spat has accentuated the opportunities for, and the necessities of, deepening US-India security cooperation. The 2+2 offers a useful forum to discuss how to seize these new opportunities and how to move the needle forward on bilateral relations,” Kugelman said.

Pompeo and Esper both have criticised China for the ongoing faceoff at the LAC while US President Donald Trump has even offered to mediate between the two.

“Because of China’s aggression globally, including the LAC incident with India, there is now a sense of urgency between both sides (India and the US) to coordinate and bring in momentum in the defence partnership, by way of more procurement. And this momentum has to be built now,” said Mukesh Aghi, president and chief executive officer, US-India Strategic Partnership Forum.

“This will be the focus even for the new administration that comes in. The US now wants to align with India, and the LAC incident just accelerated that,” said Aghi.

According to sources, India is also looking at a number of arms procurement from the US even as the defence trade between the two has been steadily rising from $1 billion in 2008 to $18 billion in 2019.

India has so far procured Apache, Chinook and MH-60 Romeo Seahawk helicopters, M777 Howitzer guns, and Super Hercules C-130J military transport planes from the US, among other items. Several other procurement are also in the pipeline, with India now keen to purchase the medium-altitude long-endurance (MALE) armed Predator-B drone and other high-tech weapons.
 
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