India-USA Relation

• Today, the India-U.S. bilateral cooperation is broad-based and multi-sectoral, covering trade and investment, Defence and security, education, science and technology, cyber security, high-technology, civil nuclear energy, space technology and applications, clean energy, environment, agriculture and health.
• India-U.S. bilateral relations have developed into a "global strategic partnership", based on shared democratic values and increasing convergence of interests on bilateral, regional and global issues.

Reasons for the qualitative transformation in India- US relations:

• An evolving geo-political convergence and growing discomfort in the US about China.
• The rising stature of India on the global stage.
• India’s economic potential.
• War against terrorism.

Convergences

• US as a “Natural ally”: The US supports India’s emergence as a leading global power and vital partner in efforts to ensure that the Indo-Pacific is a region of peace, stability, and growing prosperity.
• In New Security strategy (NSS) it explicitly includes India in its definition of the Indo-Pacific, which stretches “from the west coast of India to the western shores of the United States.
• Co-operation at Forums like QUAD (India, the United States, Japan and Australia), to secure the Indo- Pacific and countering Chinese accession in Asian geo politics.
• The strong people-to-people ties between our countries, grounded in shared values, are a tremendous source of strength for the partnership.

Defence ties:

• Over the past decade, India and the US have developed a closer partnership, wherein India has gradually shifted from its historic dependence on Russia and now conducts more exercises with the US forces than with any other country. (USA treat India as NATO Member. Giving Defence Intelligence data, Satellite data etc…Even India is not a member of NATO)
• he India-US cooperation has entered a new phase with the US having moved India up into tier-1 of the “Strategic Trade Authorisation” for unlicensed export of sensitive Defence items to India.
• A step further than the Obama administration, which had designated India as a “Major Defence Partner.”
• STA status is generally reserved for western countries and key allies.
• The U.S.-India Counterterrorism Joint Working Group, (2000) one of the oldest dialogues.
• India hosted the inaugural 2+2 Ministerial Dialogue (3 Meeting Done) in New Delhi led by both the countries’ Minister of Defence and External affairs, at which both sides affirmed the importance of India’s designation as a Major Defense Partner of US.
• Recent approval by the US for supply of armed Sea Guardian drones to India — which were hitherto sold only to NATO countries. (unmanned drones).

Recently India USA signed all the 4 core Defence agreements.

General  Security of Military Information Agreement (GSOMIA)	It  facilitates opportunities for greater  intelligence sharing between India and US. Recently, Industrial Security  Annex (ISA) to GSOMIA was concluded between both countries. ISA  provides a framework for exchange and  protection of classified military information between U.S. and Indian Defence  industries. It  was signed in 2002.
Logistics  Exchange Memorandum of Agreement (LEMOA)	LEMOA  gives access, to both countries, to designated  military facilities on either side for the purpose of re-fueling and  replenishment. (Use of Ports & Naval Facility). The  agreement will primarily cover four areas-port  calls, joint exercises, training and Humanitarian Assistance and Disaster  Relief. This  is purely a logistical agreement and there will be no basing of the U.S. troops or assets on Indian soil. India  can access the string of U.S. facilities across the globe for logistical  support and the U.S., which operates in a big way in Asia-Pacific, will  benefit from Indian facilities. It  was signed in 2016.
Communications  and Information Security Memorandum of Agreement (CISMOA)	It  is an India-specific version of Communications and Information Security  Memorandum of Agreement (CISMOA) It  allows both sides to operate on the  same communication systems, enabling  an "interoperable" environment for militaries. It  provides the legal framework for the US to part with its sensitive communication equipment and codes to enable transfer of real-time operational information. It  allows India to procure transfer  specialized equipment for encrypted communications for US origin military  platforms like the C-17, C-130 and P-81s. It  was signed in 2018 and valid for 10 years
Basic  Exchange and Cooperation Agreement (BECA) for Geospatial Intelligence	BECA  will allow India and US militaries to share  geospatial and satellite data with each other which includes Maps,  Geomagnetic and Gravity data, Digital publications, technical assistance etc. It  will allow India to use the US's advanced geospatial intelligence and enhance the accuracy of automated systems  and weapons like missiles and armed drones. It  is signed in 2020.

• The United States supports a reformed UN Security Council that includes India as a permanent member.
• Fight against terror: The listing of Jaish-e-Mohammed leader Masood Azhar as an international terrorist by the UN is an example of uncritical American support to India.
• he Trump administration has also thrown its weight behind the International Monetary Fund (IMF) to reinforce the FATF demands on Pakistan.

Economic Relations:

• The United States seeks an expanded trade relationship that is reciprocal and fair.
• A burgeoning trade relation can be witnessed through:
• Bilateral trade in 2018 was $142 billion, a 12.6 percent increase from 2017.
• Energy exports: In 2018 India purchased 48.2 million barrels of U.S. crude oil, a significant increase from 9.6 million in 2017.
• Service exchange: In immigration, Indians continue to dominate the high-skilled visa category, at times making up over 70 percent of H1-B visa holders. (Visa for 3 years for citizen from a foreign country to enter and stay in the United States to work in a specific specialized job).

Generalized System of Preferences (GSP) – It is a trade preference program that permits duty-free or low-duty entry of products from developing countries and territories. GSP is also called generalized preferential tariff (GPT). The GSP exempts nations from WTO (World Trade Organization) rules and policies, such as the Most Favored Nation principle.

Energy cooperation

• US India launched Strategic Energy Partnership, in 2018, to enhance energy security, bolster strategic alignment etc.
• Nuclear Power Corporation of India Limited (NPCIL) and Westinghouse Electric Company are looking to finalize the techno-commercial offer for the construction of six nuclear reactors.
• Also, India has started importing crude and LNG from the US in recent years, with total imports estimated at $6.7 billion — having grown from zero

Blue Dot Network

• To promote “high quality, trusted standards for global infrastructure development” India US along with others proposed Blue Dot Network.
• It is an across-the-board certification process that aims to bring governments, the private sector and civil society together. It is seen as counter to China’s Belt and Road Initiative.

Irritants

• Challenges in balancing India’s multifaceted relationships with Iran and Russia:
• India-Russia Relations: India’s decision to buy the Russian made S-400 Triumph missile defense system despite threats of American sanctions through the Countering America’s Adversaries through Sanctions Act (CAATSA) is a case, where Washington’s priorities clash with India’s interests.
• India- Iran Relations: Iran used to be one of the largest suppliers of crude oil to India — about 15 per cent of our crude supply came from Iran. It is a matter of our critical energy security interest.
• New Delhi has been forced to stop concessional oil imports from both Iran and these heavy-handed American tactics have led to sharp rise in India’s oil import bill.
• The U.S. attempts to undercut India’s strategic ties with Iran are going to pose serious challenges for Indian foreign policy. The common concerns of India and Iran about threat of terrorism emanating from Pakistani territory make Iran an important geopolitical partner of India.

US-Pakistan Relationship:

• Despite Washington’s claims to having de-hyphenated its relations with India and Pakistan, the US has not been able to extricate itself from the liabilities of its complex alliance with Pakistan.

Trade

Trade ties:

• Trade ties are also a source of tensions. India has been a huge beneficiary of the Generalized System of Preferences (GSP) program of USA, which has been ended recently by the Trump administration.
• U.S. has a particularly strong GSP regime, under Trade Act, 1974. India has been the largest beneficiary of the GSP.
• In 2017, India’s duty-free export to the US under the GSP was more than $5.6 billion.
• Now, 50 products (out of a total of 94 products) from India have been removed from GSP particularly impacting handloom and agriculture sectors.
• Presently, the US, often complains about India featuring in the top 10 countries with which the US registers a trade deficit, accuses India of seeking billions in exchange for committing to the Paris accords.
• The US now levies tariffs on steel and aluminium products, to the tune of Indian exports possibly losing US $245 million on these products.
• To combat this loss, India toyed with the idea of levying equally high retaliatory tariffs on US imports, e.g. chickpeas and Bengal gram, lentils etc.

Tariff issues:

• US President called India “the tariff king” and raised issues with India like:
• Indian motorcycles imported into the US tariff free while US motorcycles imported to India face high tariffs.
• Intellectual property rights: India has been placed in Priority Watch List of the USTR’s Special 301. (Ex: If depreciation of rupee, RBI tack action to control according to Dollars. Then India is kept in USTR’s Special 301 to counter RBI action, because RBI action strength Rupee, Week Dollars).

Subsidies issues:

• Subsidies given by some US states to local renewable energy producers
• US is against the Minimum Support Price (MSP) regime of India and accuse India of violating WTO subsidies norms and limitations.
• Visa related tensions: India is the largest beneficiary of H1-B visa scheme of US. But US in recent times has increased visa fees for H1-B applicants and cut their quotas.
• This has been detrimental for the interest of Indian IT companies. India has raised concerns on this issue.
• International Solar Alliance – India say anyone give solar panel to India, but India give preference to 35% domestic (Local Product) content used company. (US file case against India in violation of WTO principle, not treat all country equally. But State in US also do this, so India file case).

India – US have been also engaged WTO in dispute resolution:

• India dragged the US to the WTO dispute settlement mechanism over the imposition of import duties on steel and aluminium.
• Also, India and US are at loggerheads on subsidies and Domestic Content Requirement (DCR) provisions to renewable energy sector in their respective countries.