January 22, 2015
Furious last-minute negotiations are underway on deals the US is insisting emerge from Sunday’s summit meeting between Prime Minister Narendra Modi and President Barack Obama, government sources have told The Indian Express. The US, the sources said, is pushing for announcement of major military co-production and civilian projects Obama will be able to showcase as successes when he returns home.
Pressure to show results had intensified as progress on three big prizes the two leaders had promised to work towards achieving at their last summit meeting in September has been slow — meaning no agreements on these issues will be announced when the two leaders address the media on Sunday.
“There will be some tangible results from this meeting but the big-ticket issues that slowed the relationship down are not ready for resolution just yet,” a senior diplomat said. “The significance of this visit is mainly symbolic.”
India and the US have held at least two rounds of talks since Prime Minister Manmohan Singh’s government announced last year that it intended to rapidly resolve concerns over nuclear liability issues that have stalled implementation of the decade-old civilian nuclear agreement. However, negotiators from both countries have been unable to arrive at a way forward.
India, the sources said, has also said it is unwilling to open negotiating a bilateral investment treaty the US has been pushing for since 2010, saying it is critical to facilitate investment. India says it is currently reviewing similar treaties signed with other countries, and will only start discussions after this process is complete.
The two sides have come closer to resolving their differences on intellectual property rights — an issue that has led prominent US companies to lobby Congress for action against India. However, the two countries remain some distance from a consensus.
“Frankly, it is unfair to expect major results from a summit meeting that comes just six months after their very first summit meeting. The important thing here is the symbolic message President Obama’s presence sends out,” said former diplomat Vivek Katju.
But Obama’s decision to travel to New Delhi has been attracting criticism at home, with influential commentators saying it suggests he has given up on pushing his domestic agenda. Earlier this week, the Associated Press’s White House correspondent said the trip showed Obama had crossed over into the lame-duck stage of his presidency: “He’s going to India basically for a parade and a visit to the Taj Mahal.”
The new US ambassador in New Delhi, Richard Verma, pushed back against the criticism at a talk at the Brookings Institution on Wednesday. “Things not only feel different in the India-US relationship, they actually are different,” he said. Verma said in a decade, two-way trade had risen five times, to $100 billion, and that both countries are pushing to raise that to $500 billion.
The Defence Ministry is also committed to renewing a 10-year-old defence cooperation pact, and talks are underway to see if the new version can include specific commitments on co-production of missiles and an aircraft carrier.
Last year, the US emerged as India’s largest arms supplier, registering $10 billion in sales since 2005. The US had hoped Modi, who promised to fast-track military modernisation programmes, would give a substantial share of business to its firms. It is unclear, though, if New Delhi can rustle up the cash needed for major acquisitions this year — the most high-profile among them a joint Army-Air Force proposal for Apache 64D assault helicopters. Earlier this month, the government diverted Rs 13,000 crore to revenue expenditure from the Rs 94,587 crore allotted to defence expenditure. Eighty per cent of capital expenditure is committed to meeting bills, so the cuts will leave little for new acquisitions.
Negotiators from the ministries of Finance, Defence, Home and External Affairs have, instead, been working with US counterparts to stitch together pacts on economic issues. Key among them is a proposal to give a consortium of Cisco, IBM, 3M and others a role in developing smart-cities infrastructure in Ajmer, Allahabad and Vishakapatnam.
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