Monday, 16 February 2015

America President's India Visit

This was the first time a US President attended the Republic Day Parade though an invitation was once extended to then US President Bill Clinton but he had declined. Mr. Obama also made several accommodations such as shifting his State of the Union address to an earlier date as it would have clashed with his visit to India. In addition, he cancelled plans to visit some cities in his country although US Presidents tend to do so after the State of the Union address to explain its finer points to the domestic constituency. Mr. Obama also became the first US President to visit India twice, once in each of the two terms in his Presidency. The gap between his two visits was also the shortest ever. The first US President Dwight D Eisenhower came 12 years after India became Independent, Richard Nixon followed 10 years later, Jimmy Carter after nine years, Bill Clinton after a pause of 22 years, George W Bush's visit had a gap of six years while Mr. Obama's first visit followed four years later. The visit also saw the most intensive interaction ever with an Indian Prime Minister. The two leaders - Mr. Obama and Prime Minister Narendra Modi - met several times in New Delhi that allowed them to understand each other on a more personal basis. Preparations for the visit were also extremely intensive. A contact group on nuclear energy set up during Mr. Modi's visit to Washington last year met thrice in different parts of the globe while senior public servants of both countries including US Vice President John Kerry also interacted on issues of great concern such as co-manufacturing of defence items, climate change and trade and investment. The highpoint of the visit was acceptance of the fact that India was ready for the global high table. There was a unequivocal endorsement of the need to admit India as a member of the United Nations Security Council and during his joint address with Mr. Modi, the US President made it clear that Washington would do it best to get India admitted into four international export control organizations for sensitive and dual use items. These organizations such as the Nuclear Suppliers Group (NSG) and the Missile Technology Control Regime (MTCR) have barred membership if a country has not signed the Nuclear Non-proliferation Treaty (NPT). India is not a NPT signatory but the US has not given a similar assurance to either Israel or Pakistan which have also not signed the NPT. The nuclear issue saw a breakthrough that eluded the Bush Administration and the first term of Barack Obama. Ever since India passed the Civil Liability for Nuclear Damage Act (CLNDA) in 2010, the US has been insisting that it is not compatible with international covenants such as the Convention on Supplementary Compensation- the Paris Convention and the Vienna Convention. In particular it has been insisting on changes in Section 17(b) and Section 46 of the CLNDA. The consultations before the visit helped pave the way for the US accepting the Indian proposal for creating an insurance pool to alleviate US misgivings on Section 17(b) that holds suppliers of equipment liable to pay compensation in case of a nuclear accident and also accepting India suggestion for approving a memorandum of law to surmount the issue facing section 46. This in effect means that in the coming years, two US companies (with Japanese shareholding) will be able to set up nuclear plants in India. The defence sector also saw both sides reaching a modest agreement that could be the stepping stone for more instances of joint production mainly due to the Defence Trade and Technology Initiative (DTTI). The US as well as many other major manufacturers of defence products have been loath to part with the technology and are more content with selling finished products. Prime Minister Narendra Modi's emphasis on Make-in-India bore fruit with the US agreeing to co-produce three of the 17 items identified by India for co-production. They include drones whose use and range is bound to grow in the coming years for a multitude of purpose ranging from crowd control to antiinsurgency operations. Climate change was another area where convergence was seen between the two countries. For India combating climate change is as important as major emitters such as the US and China because the Himalayas are melting and India stands to be hit hard by this. Other countries are also interested in reaching a global agreement in Paris later this year. As the third highest emitter, although the per capita emission is very low, India plans to increase its solar capacity by a huge amount as well as put up more nuclear plants. The visit saw Mr. Obama agreeing to loan two billion dollars for providing equipment that generates carbon-free form of energy. Now, reducing carbon emissions, as you know, is a delicate diplomatic tightrope for states. Also on the fast track will be Indian investments in manufacturing and technology as investors and entrepreneurs explained various issues and problems to Mr. Modi and Mr. Obama who took time from their busy schedule especially for them. Both India and the US attached great importance to trade and investment especially after the two leaders targeted a five-fold increase in their bilateral economic engagement from the present 100 billion dollars to 500 billion dollars. In addition to Indian Commerce Minister Nirmala Sitharaman, the US Commerce Secretary Penny Pritzker was also at hand. Ms. Pritzker announced that financing option from EXIM Bank of India for Indian small and medium sized companies who are interested to expand overseas could be availed of while assuring Indian companies that her Commercial Service team was dedicated towards supporting Indian companies who are planning to expand across sectors in United States. The US also promised to support the Modi Government's ambitious Digital India Programme that envisages broadband connectivity to 2.5 lakh villages and Wi-Fi in as many schools by 2019. The US-India collaboration in this space will help create viable and scalable business models for digital infrastructure, including e-governance and e-services etc. The visit saw US companies also agreeing to back the major project underway to develop industrial corridors connecting all four corners of the country by agreeing to look at the possibility of investing in manufacturing facilities along the corridor. India has a young demographic profile and needs assistance in the education and skills upgradation sectors. Mr. Obama and Mr. Modi agreed to step up collaboration in the field of skills development, student and scholar mobility, faculty collaborations between the two countries, including ongoing collaboration on community colleges, improvement of workforce training, expansion of research and teaching exchanges. In the area of skills and vocational education, the key to promoting orderly growth of manufacturing by adequately training the workforce in the skills required by Indian industry, new initiatives in curriculum development were agreed upon. That India has come of age and is ready to play a more high profile role in world affairs was demonstrated by the Joint Statement issued by the two leaders in which they clearly asked for international laws to prevail instead of one country seeking to dominate in international waters of South China Seas through which a huge amount of trade and oil passes. In sum the visit brought about, due to the election of the first majority Government in three decades, a sea change in US attitude towards all the issues held dear by India including energy security, greater investment, combating climate change, becoming self-sufficient in defense production and enhancing the skill sets of the millions of young Indians who are poised to join the workforce.

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