So what can Obama do for India?

A high-tech trade agreement could change the playing field, writes Asia Sentinel’s David J. Karl

With US President Barack Obama’s state visit to India beginning just days after the mid-term Congressional elections, critics may be tempted to see the trip as his way of seeking refuge from storms at home. After all, Mr. Obama remains popular among the Indian people and is sure to receive a rousing welcome. But cynicism aside, the trip provides Obama with a key opportunity to instill a level of momentum in bilateral relations that has been noticeably missing since George W. Bush left the White House.

To make the most of the occasion, the president must come armed with bold, creative ideas. Lackluster initiatives characterized last November’s summit meeting between Obama and Prime Minister Manmohan Singh, which is remembered more for the antics of its party-crashers and the eventual ouster of the White House social secretary than for any substantive achievement. 

To avoid a similar fate, Obama needs to put a few high-profile proposals on the table, which even if they cannot be implemented immediately will at least re-galvanize bilateral relations and impart an overarching vision that is now lacking. In particular, he should lay out a sweeping initiative aimed at capitalizing on mutual synergies in the area of high-technology trade.

In the decade since US economic sanctions against India were rolled back, bilateral trade levels have skyrocketed. Nonetheless, important areas of cooperation are unexplored and significant frictions, on prominent display in the US-India impasse that led to the breakdown of the Doha Round of multilateral trade talks, remain between Washington and New Delhi. 

Despite growing geopolitical tensions between New Delhi and Beijing, India-China trade has risen sharply over the past few years, so much so that China is poised to overtake the United States as India’s leading trading partner. India has also recently concluded important trade agreements with Japan, South Korea and the 10-country Association of Southeast Asian Nations, is reportedly on the verge of concluding a trade pact with the European Union, and has launched bilateral trade negotiations with China and Canada. 

Given that trade policy is a highly contentious political issue in both countries, negotiations aimed at producing an US-India accord – especially one that deals with agricultural access and subsidy issues – will almost certainly be futile. A more imaginative and viable approach, however, would be to concentrate on further liberalizing two-way trade in advanced technology products and services, including the critical information technology field.