Why in the News?

After the USA’s election result, U.S.-India (in 2nd term of Donald Trump) ties could be stronger, but issues over tariffs might cause trouble.

Why US India ties will be strengthed?

• Shared Strategic Interests: The U.S. and India both view China as a significant strategic challenge, which aligns their interests in the Indo-Pacific region. This common perspective fosters collaboration on defence and security matters.
• Political Will and Leadership: The anticipated second term of Donald Trump is expected to reinforce the U.S.-India relationship, as evidenced by the strong ties developed during his first term. Trump’s cabinet nominees are also pro-India, indicating a continuity of support for enhancing bilateral relations.
• Economic Cooperation Potential: There is a renewed focus on trade agreements and economic partnerships, including the possibility of finalizing a Free Trade Agreement (FTA), which could enhance market access and reduce tariffs, benefiting both economies.
• Defence and Technology Collaboration: Continued emphasis on defence cooperation and technology partnerships, particularly in areas like semiconductors and emerging technologies, will strengthen ties and enhance mutual security interests.

In which area would ties be strengthened?

• Defence and Security: The U.S. and India have significantly enhanced their defence cooperation, including joint military exercises and technology transfers, such as the recent offer to restart the transfer of jet engine technology to India.
  • The India-U.S. Initiative on Critical and Emerging Technology (iCET) aims to foster collaboration in areas like artificial intelligence, quantum technologies, and cybersecurity.
• Economic Relations: Bilateral trade has surged, increasing by 72% from 2017-18 to 2022-23, highlighting a robust economic partnership.
  • Both nations are keen on resolving trade disputes to further enhance mutual benefits.
• Technological Collaboration: Initiatives like INDUS-X focus on integrating defense start-ups from both countries, promoting innovation in military technology and enhancing capabilities in critical sectors like semiconductors.
• Multilateral Cooperation: Engagement through platforms like the Quad (with Japan and Australia) strengthens regional security cooperation against common threats, particularly from China.

What could be the challenges between India and the USA?

• High Tariffs and Market Access: Disagreements over tariffs and market access for U.S. products in India, particularly in agriculture and technology sectors, remain significant irritants.
• Geopolitical Tensions: Differences in policy regarding Iran and Russia may create friction in the bilateral relationship, particularly with India’s historical ties to Russia.
• Legal Investigations: Ongoing investigations by the U.S. Department of Justice into cases involving Indian entities could complicate diplomatic relations and create perceptions of bias against the Indian government.

What should India do to address the challenges? (Way forward)

• Engage in Constructive Dialogue: India should actively engage with the U.S. to address tariff issues and seek mutually beneficial solutions that enhance market access for American products while protecting domestic interests.
• Strengthen Economic Cooperation Frameworks: Pursuing comprehensive economic agreements that encompass trade, investment, and technology sharing can help mitigate tensions and foster a more robust partnership.
• Clarify Stances on Geopolitical Issues: India needs to communicate its positions on sensitive geopolitical matters clearly to avoid misunderstandings with the U.S., particularly regarding its relationships with Iran and Russia.

Mains PYQ:

Q  Quadrilateral Security Dialogue (Quad) is transforming itself into a trade bloc from a military alliance, in present times Discuss. (UPSC IAS/2020)

Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024

Attend Now