Is India really Donald Trump’s ‘true friend’?
There are not too many countries towards whom the new United States President, Donald Trump, has shown a consistently friendly demeanour. India is one of them.
As Trump told Prime Minister Narendra Modi in his most recent phone conversation to New Delhi, he saw India as a “true friend”. India is seen, strategically, as a kindred spirit by President Trump and his team.
However, the indications are that no country will receive a free pass when it comes to Trump’s core nationalist economic concerns. In other words, Indian businesses should brace for some damage to their bottomlines under a Trump administration. But the evidence is that India will make gains elsewhere and that, of all countries, India will be among the least affected by Trump’s barriers to trade and immigrants.
The greater worry for any Asian government is the lack of a strategic framework in the US’ dealing with a continent where military solutions are still acceptable and multilateral bodies are weak.
“Predictable is bad” is a favourite Trump line. That may work in real estate negotiations, but in hard-nosed geopolitics, it increases the likelihood of error, makes allies skittish and confrontation more probable.
During his presidential campaign and just after his formal election, Trump was remarkably aggressive when it came to China. While Washington’s line towards Beijing had hardened in the last few years of the Barack Obama administration, the new President took it to a remarkable rhetorical level.
Trump’s team produced an article in ‘Foreign Policy’, written by Alexander Gray and Peter Navarro, titled ‘Donald Trump’s Peace Through Strength Vision for the Asia-Pacific’. The article argued Obama’s use of trade arrangements like the Trans-Pacific Partnership and devaluation of US military power had encouraged Chinese assertiveness. Arguing that such trade agreements had only undermined US economic strength, the two claimed the Trump administration would return to military power and unilateral trade action to counter China.
Trump’s criticisms of China have been largely economic. He has accused the country of being a “currency manipulator” and claimed that its unfair trade practices have cost the US millions of jobs. Commenting on China’s trade deficit with the US, he accused Beijing of economically “raping” the US. While his criticism has some merit, many of his claims are wrong or exaggerated.
Trump has commented on strategic problems less often and tied it to economic concerns. But when he has, he has been dramatic. For example, he shook the bedrock of Sino-US relations by questioning the “one China” policy and flirting with Taiwanese recognition.
China’s leadership has been largely quiet on the economic charges. They have responded strongly, though largely through their media, only when Trump or his appointees have spoken about Taiwan or the need to challenge Beijing’s takeover of the South China Sea.
Trump has sung a different tune when it comes to India. During the campaign he released a video in Hindi urging Indian-Americans to vote for him. He spoke highly of India’s growing economy and Prime Minister Narendra Modi. As he ungrammatically declared to Indian-American fundraisers: “I love Hindu.” It helped that he was simultaneously signing deals to build six Trump Towers across India.
After his election victory, Indian officials met the then US President-elect and his team at least three times before his inauguration. They received a consistent message from all concerned that the Trump administration wanted a close and strong relationship with India.
In itself, this was not surprising: There is a bipartisan consensus within the US polity about strengthening ties with India. When Modi and Trump eventually spoke on the phone, the two exchanged mutual invitations.
Indian officials are relatively sanguine about the personnel who are joining the Trump team. The President’s ideologues, people like Chief Strategist Stephen Bannon, have spoken of Modi’s 2014 election as being part of a global political movement. “Modi’s great victory was very much based,” he said, on “Reaganesque principles.”
The President’s foreign policy team has two centres. One group, that includes National Security Advisor Mike Flynn and Pentagon chief Jim Mattis, see the US’ primary security threat arising from the Islamic State and militant Islamic terror in general. Another sees the rise of China as the US’ main strategic concern and includes Gray, Navarro and, based on his statements at his confirmation hearing, the incoming Secretary of State. Both Flynn and Mattis also have their concerns about China.
India fits in neatly with the worldviews of both schools. Notably, a member of Trump’s transition team wrote an article saying the US President’s South Asia policy would stress the need for Pakistan to cease to provide safe haven to Islamist terror groups. The China-basher team sees India as an obvious geopolitical balance to the Middle Kingdom, a persistent strand in US foreign policy for the past two decades.
Nonetheless, this hardly means India is in any less of a soup when it comes to Trump’s trade policies than any other country. Whatever the strategic convergence with another country, the US President is clear that in foreign policy he is “America First”.
Thus, his government immediately began initiating action to restrict the issuance of H-1B temporary work visas – most of which are used by software workers from India. Indian officials are resigned to losing a portion of the country’s $7-billion service trade surplus with the US in the immediate future.
A Credit Suisse report has noted that Trump’s plans for a border adjustment tax on imports would only affect 2.5 per cent of India’s value-added goods exports to the US and would cost India about 0.25 per cent of its GDP. For example, Vietnam and Taiwan would suffer far worse, losing nearly 1 per cent of their GDP in such a scenario.
The US and India have a number of other outstanding trade disputes, most notably about India’s high agricultural tariffs and its allegedly lax intellectual property rights. It is yet to be seen how aggressively Trump will take these up with India.
The Modi government remains wary of how the Trump administration will handle India’s arch-rival Pakistan, but assumes he will continue Obama’s slow but steady winding down of the supply of US arms and aid to that country. But India expects the new administration to keep a US military presence in Afghanistan to support the regime there against the Taliban.
New Delhi also hopes Trump will not tear apart the nuclear deal negotiated by Obama with Iran. India believes a US-Iran rapprochement would greatly enhance Persian Gulf stability.
So far, the indications are that the US President will hold on to the letter of the agreement but undermine its spirit – the recent de facto visa ban on Iranians being an example.
Another point of disagreement between Modi and Trump is climate change. India and China have both favoured the recent Paris agreement on climate change, a pact that Trump wants the US to leave.
US federal support for India’s clean energy programme is in question, but there seems to be sufficient private sector funding and support from other developed countries to fill in the void left by Washington whether in terms of rules-setting or funding.
Both China and India would benefit from Trump’s plans for a huge boost in US oil and gas exports. This would help keep oil prices down to below $60 per barrel levels – hugely beneficial to India’s bottomline. This would be useful to both Asian countries as they are net importers of fuel and the present price situation has been a huge boon in terms of overall GDP growth and government revenue.
What is Trump’s grand strategy or, to put it another way, how will he win friends and influence governments with a foreign policy shot through with unilateralism and a transactional approach?
Trump, for all his belligerence regarding Taiwan, also seemed to tweet that he was prepared to put such strategic issues on the negotiating table if, in return, China gave him the sort of trade concessions that he wants for his working class base.
In other words, there is no evidence a Trump administration has a strategic framework regarding the Asia-Pacific – other than the extremely narrow one of seeking better trading terms for US goods and services. Even when it comes to his professed hostility to China, it is not clear if Trump sees his statements as a negotiating position. In his own book ‘The Art of the Deal’, Trump notes he likes to begin negotiations with a maximalist position.
This has led most Asian governments to hedge their views about Trump. Those countries, notably Japan and India, who would like to see the US take a more aggressive stance against China have remained quiet about Trump’s comments regarding Beijing. They cannot rule out the possibility of the new President sacrificing US strategic space in return for trade concessions from China, though that seems unlikely.
The Trump administration remains remarkably short-handed with thousands of staffers still to be appointed, especially in key ministries like the State Department and the Pentagon. This could take a year. Only once these positions are filled will the power balance between the ideologues versus the pragmatists become clear.
While Modi and Trump have exchanged invitation offers, the Indian leader is likely to take his time in fixing a summit with the new US President.
Pramit Pal Chaudhuri is Distinguished Fellow and Head of Strategic Affairs, Ananta Aspen Centre, a News Delhi based independent and not-for-profit organisation focusing on leadership development and open dialogue on important issues facing Indian society.