Lens on Modi

Washington wants to know if he can fix structural flaws in India’s economy.

Written by Frederic Grare | Published:September 29, 2014 12:52 am
Modi arrives in Washington preceded by his reputation as chief minister of Gujarat. Modi arrives in Washington preceded by his reputation as chief minister of Gujarat.

Narendra Modi’s visit to the American capital has created high expectations. Despite the hope generated by the successful conclusion of the US-India civilian nuclear deal in 2008, India and the United States slowly drifted apart in the years that followed. The visit of the new Indian prime minister is, therefore, expected to mark the beginning of a revival of the US-India relationship.

Policy wishlists and suggestions of ways to reset relations between the two countries are, accordingly, the most widespread commodity around Washington think tanks these days.

Modi arrives in Washington preceded by his reputation as chief minister of Gujarat. During his tenure, he proved to be a remarkable manager, bringing economic success to the state and earning a reputation as a strong, decisive leader — a “doer”, with his past accomplishments inspiring confidence for the future.

The remarkable trust invested in the Indian leader is best shown in the rise his election inspired in the stock market, which has leapt since he assumed office. Similarly, India’s annual economic growth is expected to rebound to almost 6 per cent, after it had sagged to 4.5 per cent in 2012-13 following two years of high growth.

Such positivity in the investment and economic climate is largely attributable to increasing investor and economic confidence, not to any fundamental change in India’s economy. Modi’s hyperactive diplomacy has been described as muscular and imperious. He is indeed seen as the man of the moment, capable of fixing the many flaws and weaknesses of the Indian economic and political system and leading his country to new heights.

On the surface, the contrast with his predecessor could not be sharper. The cerebral, soft spoken Manmohan Singh — or the “accidental prime minister”, as commentator Sanjaya Baru recently called him — was politically dependent on the Congress party leadership, making him (unfairly) look weak and indecisive. In contrast, the man US President Barack Obama meets  is an Indian prime minister with the biggest electoral mandate in decades, having led his party to the first outright majority in 30 years.

The personal differences do not stop there. Singh was intimately convinced of the necessity of the American partnership, while Modi’s relationship with Washington is distant and instrumental. Ironically, however, the US-India relationship started drifting under Singh’s leadership, as both sides failed to sustain the momentum of the civilian nuclear deal, arguably the most important step in their effort to reconnect after decades of estrangement. Today, hopes to revive the relationship rest on a man who, until recently, Washington considered a pariah.

Despite differences of style and personality, Modi is closer to his predecessor than one might expect. While both men are firm believers in economic liberalism, the first significant foreign policy decision of the Modi administration was to refuse to sign the WTO’s Trade Facilitation Agreement for fear of having to stop India’s food procurement subsidies, a programme begun by Modi’s predecessor. Ironically, Manmohan Singh had negotiated the WTO agreement for India and would have signed it.

Further, despite all the hype in the Indian and international press, Modi’s foreign policy is largely a continuation of Manmohan Singh’s. The former’s much-trumpeted visit to Japan, for example, brought no qualitative change in the relationship. And if the government’s language towards China has moved from an assertive caution to a (very) cautious assertiveness, Beijing has quickly reminded the new prime minister of the true balance of power in Asia.

Chinese President Xi Jinping’s visit to India was marked by tensions over incursions, with Chinese forces retreating only after Xi had left India.
There is nothing intrinsically wrong or abnormal about the consistency between the Manmohan Singh and Modi administrations. It simply means that India has, so far, changed much less internally compared to the dramatic shifts in international perceptions of the country and its leaders. This is not unimportant — international politics, much like any other activity, is affected by perception.

Like Manmohan Singh before him, Modi has adroitly used the rivalry between China and its neighbours, particularly Japan, to get the most out of each of them. He will most likely try the same tactic with the US. His American visit, however, takes place in a different context, and he may find his strategy difficult to pursue.

Successive US administrations have gone a long way to accommodate India’s needs, but American politicians currently feel, correctly or incorrectly, that the US has been poorly rewarded for its efforts. In the hope of developing a real strategic partnership with India, the US reversed decades of a non-proliferation policy with the civil nuclear deal, only to see the relationship falter in subsequent years. True, self-interest also influenced the shifts in policy, as a strong India, able to hold its own on China’s southern border and capable of becoming a regional security provider, was considered to be in the US’s interest.

However, the business interests that supported the rapprochement with India, in the hopes of gaining access to domestic markets, have grown frustrated. Strategic considerations in the partnership have not disappeared but have been relegated to second rank priorities.

In this context, the US is banking on Modi to recreate the momentum that once existed in the relationship. The magnetic personality of the new prime minister seems to offer a promise. Modi undoubtedly generates curiosity, sometimes bordering on fascination, thanks to his reputation of efficiency but also to his controversial past. This makes for an interesting visit.

The visit will be a success if the two countries manage to re-establish the working relationship that existed in the past but has since disappeared. The new prime minister undeniably possesses the assets to achieve that much. But the future of US-India relations will ultimately depend on India’s capacity to reform itself, and therefore on the prime minister’s ability to deliver on his campaign promises to fix the structural weaknesses of his country’s economy. This, and this only, will be seen in Washington as the ultimate test of character.

The writer is senior associate director of the South Asia Programme at the Carnegie Endowment for International Peace.
express@expressindia.com

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  1. K
    KrishnaBhagawan
    Sep 29, 2014 at 9:03 pm
    Why dont india discover medicines themselves and give it away for free. I wonder if you work or freedia's poor is India's responsibility not US. If indians shoot on their foot by following 60 yrs of corny socialism ......... what can US do ?
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      Prapur
      Sep 29, 2014 at 6:33 pm
      If true democratic principles are at heart of USA than they shall be on India side and not any other like communist China and terrorist stan.USA still thinks as one super power but now both China & Russia giving a run and have become ertive to all USA allies. Why USA thinks only India need to fix this & that? Why they are helping terrorist nation like stan where worlds most terrorist are getting shelter even though carrying bounty on their head from USA? Partnership and relationship on equal basis are acceptable but not one as master and other as slave. USA has made lot more slave in the past individual and nations. India is not a small country and may take longer to develop but would prefer to stay independent.
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        Aazar Kund
        Sep 29, 2014 at 6:11 am
        Yes,India should change it's policies that are hawkish, aggressive and real threat for regional international peace and stability. India tested it's 1st nuclear device in 1974 by diverting peaceful nuclear deal to weapons purposes. who will trust India? India proliferated nuclear technology and US is well aware of it. That's why it has raised concerns over Indian liability issue. This is time for India to do more for peace and stability in region.
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          Aditya
          Sep 29, 2014 at 1:10 pm
          The US has been poorly rewarded by India, you say? For all the US arms and monetary istance to stan's much-touted, but finally half-baked and selective, counter-terrorism operation, US could not possibly expect more. It is not as if US is unaware as to where all those military resources will be finally redirected. Not really the signs of an ally.
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            Alani Adana
            Oct 1, 2014 at 2:14 pm
            is he nuts? in the recent depression the countries not affected are India,china ,an.....all the western countries are affected and he says to change Indian policy ha ha
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              Anjaan Aadmi
              Sep 30, 2014 at 2:17 pm
              Could not agree more ... the American are the most greedy and untrustworthy people, who are out to make quick bucks ... they believed that the people of India are cheap ... the Indian leadership would sell India cheap in exchange of a flawed nuclear deal ...
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                Anjaan Aadmi
                Sep 30, 2014 at 2:16 pm
                The American are the most greedy and untrustworthy people, who are out for quick bucks ... they believed that the people of India are cheap ... the Indian leadership would sell India cheap in exchange of a flawed nuclear deal ...
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                  Anjaan Aadmi
                  Sep 30, 2014 at 2:13 pm
                  Very accurate take on the US-India nuclear deal which most people in India are not aware of ... the Americans managed to kill the intent and the spirit of the deal by introducing several poison pill amendments, one by Obama himself, seeking to rob India of its sovereign rights to conduct nuclear tests in the future ... effectively getting India into the NPT through the back door ... India's own liability laws are a -for-tat response of the American deceit in the garb of friendship.At the end of the day, the people of India recognize that the American are the most greedy and untrustworthy people, who are out for quick bucks ... they believed that the people of India are cheap ... the Indian leadership would sell India cheap in exchange of a flawed nuclear deal ...
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                  1. g
                    gsc_999
                    Sep 29, 2014 at 5:07 pm
                    Superficial article littered with inaccuracies and incorrect analysis:1) This author claims that India's GDP growth has faltered, that's true but he fails to provide balance by commenting on Recession in US economy since 2008. Which is way worse compared to slow down in India.2) Author says that US has catered to Indian interests in the past. Nothing could be her from the truth. We all know about US support for stan and US blatant choice of good and bad terrorist organization. This has caused immense harm to Indian interests.3) Author seems to display his lack of experience with Indian politics by incorrectly claiming that Modi has continued Manmohan's policies. Really, well then Obama a democrat has also continued Bush, a Republican's policy. He fails to mention that too.4) Now, coming to China, the writer muses that China came to India and showed India the real balance of power in Asia. Well, that is also a display to US. US is no longer a power in Pacific Ocean. Recent barrel roll by a Chinese fighter plane ran a shudder down American spine. He omits that facts conveniently.5) Like most Western writers who are inexperienced with Indian politics, he sermonizes that the "onus" to change the relation with US is on India. Not really, Obama has been lazy in his foreign policy initiatives and most of his endeavors have failed e.g. Obamacare and Kerry's attempt to fix Middle-East. If Us doesn't seize this moment that Modi is generously offering US, it will be a shame and only US to blame. India will keep growing, maybe, at a slower rate.Unless, US takes initiative and engage India, it will be a loss for US not India. India has been around for much longer compared to US and it will be thriving even when US ceases to be a world power.
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                      nasir Usman
                      Sep 29, 2014 at 3:08 pm
                      Still, some apprehension over the details of the legislation remains, especially in India where some pundits believe the U.S. has retracted its earlier urances that it would help India access technology to reprocess spent fuel and build a stockpile of nuclear material to tide over any potential supply disruptions. Behind the political storm triggered by the civil nuclear deal with the US lies deep-seated national concern over its long-term implications for India’s security and strategic autonomy. The deal has divided India like no other strategic issue since independence.
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                        Katewal
                        Sep 30, 2014 at 1:29 am
                        The US representatives have raised the questions regarding human right violations and lack of religious freedom in India. These buzz words "human rights violations" and "lack of religious freedom" mean that US is not interested in making any major deals with India. At the same time US considers some of the oil rich middles eastern countries like Saudi Arabia as a major ally and in these countries are the major violators of human rights and don't allow any religions to co exist. India for centuries is a diverse country with many religions co exist and tolerated.
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                          chinpin ginpin
                          Sep 29, 2014 at 10:14 am
                          Modi seems to be quite diverting from the very interest he claimed during the campaign of economic reforms but since the Modi came into power he is trying to depict his true aggressive nature. He is focusing more on defensive policies. He is in mood of making the country full of nuclear power plants at the expense of its people lives. And if both countries are sincere to each other and are truly walking on the same roads then whats the reason of holding at back on the issue of Indo-US nuclear deal?
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                          1. R
                            Raju Charles
                            Sep 29, 2014 at 6:26 pm
                            Yes, Modiji can do it! Hope the caste Parivar will let him do the job as the PM of India!
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                            1. R
                              Raju Charles
                              Sep 29, 2014 at 6:43 pm
                              Yes,Triumphant Modi can!
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                              1. S
                                sasi
                                Sep 29, 2014 at 11:42 am
                                What about the flaws in the US economy which is controlled by big companies like pharma which are looting people with the high cost of medicinesThe US is selfish to the say the least and is not bothered about the poor in India or elsewhere.It only wants profits for its companies the rest be ed.Its selective in curbing terrorism and supports stan against India.
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                                1. S
                                  Suman Bhat
                                  Sep 29, 2014 at 11:11 am
                                  Action speaks for NaMo He is leader of ppl He is leader with vision pion and always keeps country first and speaks 125 crores indians. His vision and work is fordevelopment growth and good governance. A stateman with confidence of the people his pure dedication, Hardwork, vision, governance which has brought the revolution in Gujrat and now in entire country. After He became PM he has changed the govt machenary, get the indians from war toren iraq, syria and get minority youths free from KSA jail. got released fisherman from srilankan jail improve the relations with SAARC countries, improved social conditions, better governance resulted in food inflation is lowest in last years , GDP growth is 5.7 jumped and price of necessity commodity is undercontrol and stable All goods are cheaper than it was during upa rule. NaMo got investment from an, china, uranium from australia now interacted with 9 crores children on teachers day. And a PM on independanceday speech, startedthe work on beti bachaavo padaavo, clean india, build toilet, PM jan dhan yojana , Make In India, Digital Indian,.. Already formed SIT for balckmoney. Also work is in progress for Ganga and Yamuna river cleaning ... Modi has inherited the miseries of decade of UPAmisgovernance a decade of disaster to theNation with empty treasure, policy paralysis, destro and defamed moral of army security and police force and vote bank appeat politics disturb peace, create law& order problems. anymore modi haters are getting nightmares
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                                  1. V
                                    V. Setty
                                    Sep 29, 2014 at 6:00 pm
                                    While the USA wishes to fix everybody else's problems, be it structural or not, the rest of the world wants to if the USA is capable of fixing its own structural problems. Preaching the rest of the world is lot easier than acting at home to solve problems!
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                                    1. S
                                      Subhash Bhagwat
                                      Sep 29, 2014 at 3:27 am
                                      Every commentator has claimed that it is India, and India alone, that needs to change policies in order to "fix" the Indo-US relations. What about U.S. intransigence on stan? What about the fact that India signed away her rights to test nuclear weapons in perpetuity in exchange for a questionable source of energy that is too expensive at that? Let's get balanced if we want to fix this relationship and also expect the US to give some..
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                                        Urmila Rao
                                        Sep 29, 2014 at 10:23 pm
                                        His past is not that controversial what it is made by MSM on behest of vested interests.
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                                          common
                                          Sep 29, 2014 at 12:15 pm
                                          What does one get by wasting money of conducting a nuclear test except to give some kick to a politician? What do you want from USA except to give 2 billion US $ as an aid to survive? If stan is having any pride, can it refuse the aid or refuse to have any diplomatic relation with any western power?
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                                          1. Y
                                            yogesh
                                            Sep 29, 2014 at 2:00 pm
                                            As always US is being too selfish here. India has given so much to US. Unlike other strong nations(Chine and Russia), Indians has whearted adopted all US bs(recent example are Facebook, Google, Twitter) and provide good money and future prospect for US share holders of these companies. Despite all the wrong doing by US(with respect to offering military aids to stan), India went ahead made US largest weapon supplier. Now when come to India's concern about giving farm subsidy to Indian farmer, western countries are having double standards. They are giving billions in farm subsidy to their farmers and Dairy industry by other ways but they want India to give up its most effective farm subsidy program- MSP(minimum supported price) and leave small Indian farmers vulnerable.This is hypocrisy at best. Go and try same method to China and you will understand the difference.
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