Date: 8th May 2012
New Delhi: US secretary of state Hillary Clinton arrived in India on Sunday on the last leg of a three-nation Asian tour—seen by some as a farewell trip to the region.
Clinton, who visited China and Bangladesh before arriving in Kolkata, will meet West Bengal chief minister Mamata Banerjee on Monday before heading to New Delhi for talks with her counterpart S.M. Krishna, and a meeting with Prime Minister Manmohan Singh.
“Clinton has herself said she would be stepping down at the end of the year,” said a person close to the developments on the Indian side. “She has been responsible for keeping the India-US relations on an upward trajectory. She likes India, so it is not unusual for her to come.”
The visit comes at a time when ties between the world’s oldest democracy and the world’s largest democracy are perceived to be adrift after reaching a high-water mark in 2008 with the signing of a civil nuclear deal.
The pact was pushed through by the US and helped India throw off its 34-year-old nuclear pariah status and become eligible to buy atomic power plants and technology from the international market.
The deal was expected to open the doors for US businesses but has made little progress because of India’s stringent liability conditions. This, and the US losing a lucrative $12.6 billion contract for 126 fighter aircraft for the Indian Air Force to France are being read as some of the many signs of the ties losing momentum.
But the person cited above dismissed such fears, pointing to the breadth of interaction from strategic and security to economic, education, science and technology and defence. “Ties have never been as strong as they are now. Yes, there are no big-ticket items, but our trade with the US crossed $100 billion for the first time (in 2011-12) in both goods and services. In comparison, our trade with China is $74 billion.”
Other evidence of both sides having made considerable progress in ties comes from initiatives in renewable energy, energy efficiency and both sides agreeing on a higher education dialogue, this person said.
“On the civil nuclear deal, a team from the US (headquartered) firm, Westinghouse, has recently been on a visit to Gujarat (where a nuclear plant is expected to come up) and has held discussions with Nuclear Power Corp. of India Ltd,” the person said.
In Kolkata, the talks between Clinton and Banerjee are expected to focus on business and investments. “I think she (Clinton) looks forward to seeing chief minister Banerjee—one of India’s dynamic women chief ministers,” a senior Obama administration official told the Press Trust of India news agency last week.
The interaction is being viewed as significant as Banerjee was one of the chief ministers who opposed New Delhi’s plans to allow foreign direct investment in multi-brand retail, pouring cold water on plans by retailers such as Wal-Mart Stores Inc. from entering the Indian market.
“There is recognition that regional leaders in India are also important in terms of policymaking,” said political analyst B.G. Verghese.
Banerjee won state elections in West Bengal last year, ousting the three-decade-old Marxist government. “Clinton sees this as an important opportunity to discuss some of the important opportunities for expanding trade with Bangladesh and beyond,” the US official said referring to the warming ties between India and Bangladesh since the election of Awami Party leader Sheikh Hasina as Bangladesh Prime Minister in December 2008.
India has been keen on signing an agreement on the sharing of the waters of the Teesta river with Bangladesh but has not been able to in the face of opposition by Banerjee.
In New Delhi, Clinton’s talks are likely to cover Iran, Afghanistan, Pakistan and China. This exchange comes ahead of the India-US strategic dialogue on 13 June in Washington. “There is a broad spectrum of issues for dialogue,” said C. Uday Bhaskar, former head of the National Maritime Foundation.
“One of the key issues is the tri-polar economy—US, China and India—how do you manage this? There will be consultations on Iran and Afghanistan and Pakistan,” he said.
On Iran, the discussions are likely to centre on the approaching 28 June deadline for US sanctions aimed at crippling Iran oil trade to take effect. “Iran remains an issue,” said the person cited above.
“Clinton has been one of the strongest proponents of taking a tough line on Iran. This would certainly come up,” said the person, referring to West’s concerns regarding Iran’s nuclear programme that Tehran says is for peaceful purposes but is suspected to be a cover for making atomic weapons.
A Reuters report from Washington last month cited Indian finance minister Pranab Mukherjee as saying that India had scaled down imports from 12-13% to between 8-9% of total imports. A second person familiar with the developments said that Iraq had now replaced Iran as the second largest supplier of crude oil to India.
But another Reuters report on Sunday cited an official travelling with Clinton as saying that the US would need assurances that India will continue to “make progress” on this issue.
Clinton’s visit coincides with that of a 56-member Iranian trade delegation for talks on how the two can trade using a rupee mechanism to work around the sanctions.
On Afghanistan, both sides are likely to discuss the strategic partnership agreement that the US signed with Afghanistan last week that commits American support till at least 2024.
The US is looking at turning the country into an economic hub linking South and Central Asia, and this is expected to figure in the talks, the Obama administration official said.
Last week, India announced it would hold a meeting of regional investors interested in investing in Afghanistan in June.
US tensions with Pakistan could also be part of the agenda, the person cited above said. US-Pakistan ties have been on the rocks since the US launched a secret mission to kill Osama bin Laden inside Pakistan on 2 May last year keeping Pakistan out of the loop.
China could also be part of the talks, given that Clinton had just finished a trip there, the person cited above said. The US has been keen on India increasing its profile in East Asia. During a visit to India last year, Clinton urged India to not only “look” east but also to “engage east and act east”.