In the 24 hours between last Thursday and Friday afternoons, I made a strange discovery. I found to my utter surprise that there are far more people with a definite view of India’s “blunder” in the WTO negotiations than I thought existed. In my naiveté, I had assumed that the endless parleys in Geneva were matters strictly for the buffs. Whether this spurt in interest in the inner workings of the Commerce Ministry had anything to do with the presence of large numbers of Americans accompanying US Secretary of State John Kerry and also preparing the ground for Prime Minister Narendra Modi’s talks with President Barack Obama in September is a matter of conjecture. Maybe we shouldn’t read too much into coincidences.
However, while it was gratifying to learn that economic diplomacy was being accorded a high measure of importance in national life, there are some facets of the US response to India’s WTO veto that are worth highlighting. Judging from conversations with American officials and ‘embedded’ non-officials, it would seem that Washington was entirely unprepared for the change of government that took place in India at the end of May 2014. It lacked an understanding of either the new Prime Minister or the key individuals who made up the new dispensation. This failure was compounded by an erroneous belief that the NDA of Modi is a carbon copy of the NDA government led by Atal Behari Vajpayee.
In their rush to gain meaningful insights into the Modi government, the policy-makers of the Obama administration arrived at certain hurried conclusions—based, it would, seem on inputs with unnamed Indian interlocutors.
The first was that the Modi Government was pro-business and would shape its policies towards everything that would add to a positive business environment. This wasn’t an incorrect assessment except that it failed to factor in India’s serious discomfiture restrictions of its right to determine its own quantum of agricultural subsidies through the Minimum Support Price structure. In a competitive democracy, the Modi Government was unlikely to agree to any proposal that could jeopardise its ability to improve the returns for a very vulnerable sector. In his talks with Kerry, Finance Minister Arun Jaitley made it clear that India was willing to go the whole hog on ‘facilitation’ issues—improve the performance of ports, reduce delays in customs clearances, etc.—and was merely seeking ‘comfort’ on the issue of agricultural pricing. In a tussle between the US farm lobby and Indian farming interests, the Modi government was clearly on the side of India. This should have been clear to the US administration and the WTO negotiators. That it thought otherwise is curious.
Secondly, due to the promptness with which Modi agreed to Obama’s invitation to come to the White House for talks, a section of the US policy establishment arrived at the conclusion that the Indian Prime Minister saw his September visit as a rehabilitation journey. It believed—quite wrongly in my view—that the visa sanctions had actually devastated Modi and that he would use his visit to package himself as a ‘respectable’ politician, acceptable to even the New York Times (a paper which had campaigned incessantly against him). In short, it was felt that Modi would sacrifice India’s farmers for the sake of cosying up to America’s east coast liberal establishment.
This completely warped image of ‘aspirational’ Modi had in fact been fuelled by inputs from India (particularly the India-based think tanks). Going by this perception, Modi and his team were the Indian equivalents of American ‘rednecks’, completely out of their depths in the world of diplomatic sophistry. It was felt that Modi would be driven by babus with one eye on post-retirement assignments in multilateral bodies. After all, that is how India had earlier been ‘managed’ in difficult situations.
The failure to get the Modi Government to bend is certain to prompt a re-assessment of the visit in September. US officials are already muttering that in view of the strategic clout wielded by the Commerce Department in Washington’s complex power equations, the fanfare around Modi’s visit is certain to be diluted. This dilution, however, will be contested by the Department of Defence that is greedily viewing India as a big market for US-made armaments. It is also looking at India as a possible buyer (at discounted prices) of a great deal of military hardware that will be expensive to cart back from Afghanistan.
A possible reason why these departmental conflicts could be disproportionately important lies in the fact that under Obama, the US is becoming increasingly disinclined to engage with the outside world. The Republican opposition is often inclined to overstate its misgivings of the Obama Presidency, but one thing it has correctly highlighted is the fact that there is no larger global vision driving the US. Does the US, for example, really know or even care for the consequences of its impending withdrawal from Afghanistan on the subcontinent?
Many Indians who met Kerry on this visit thought he had come underprepared. Maybe they mistook deliberate tentativeness for casualness. Whatever the reality, there are few certitudes governing Indo-US bilateral relations in 2014. In 2005, the strategic partnership between Washington and Delhi promised to change power equations in Asia. Now, nine years later, they are back to rediscovering each other, often with astonishing amateurishness. Modi may want to change things in September but it always takes two to tango.