India- U.S. Relations

India- U.S. Relations

  • The relations between India and the U.S.A. have changed from estranged democracies to strategic partners.
  • Before 1991 India and the U.S.A. despite being the largest and oldest democracies respectively remained detached.

  • In the post-cold war era i.e. after 1991, both turned into strategic partners.

Historical background-

Phase I ( 1947- 1971)

  • In the 1965 war with Pakistan, the US maintained a neutral stance despite being an ally of Pakistan.
  • However, India continued to give preference to the USSR, which became a mediator in the Tashkent Agreement.
  • After this, the US sided with Pakistan and India signed a treaty Of peace and friendship with the USSR in 1971.
  • The Nixon administration's support for Pakistan during the Indo- Pakistan war of 1971 affected relations.
  • During the time of the Cold War, the USA did not have any India-specific policy but a cumulative South  Asia policy.

Phase II (1971- 1991)

  • 1974- the focus was India’s nuclear non-proliferation, Pokhran experiment further deteriorated relations.
  • 1982- Indira Gandhi visited the US main concern was to address India’s nuclear program. However, there was no achievement.
  • 1984- Bhopal gas tragedy witnessed a lack of cooperation by the US.

Phase III ( 1991- 2005)

  • 1991- bipolar to the unipolar world, new economic policy signed by India i.e. liberalization, privatization, globalization, and search for new economic partners across the globe.
  • India, Russia, and China to form the RIC triangle.
  • India does not join NPT (non-proliferation treaty) and CTBT(  comprehensive nuclear test ban treaty)
  • 1998- Pokhran test.
  • The USA now compelled India to sign the CTBT.
  • 1999- US sided with india in the Kargil war
  • 2000- Bill Clinton visited India after 22 years and this is the beginning of a strategic partnership.
  • 2001- The US lifted sanctions and called India a natural ally.
  • The strategic partnership led to the foundation of civil nuclear cooperation.
  • Manmohan Singh paid a visit to the US and finalized the 123 agreement.
  • The Defence framework was signed for 10 years.
  • In 2016 the USA granted India the status of a major defense partner.

Current bilateral relations-
Economic relations-

  • Bilateral Trade-  The United States is India's second-largest trading partner and India is the 9th largest trading partner of the U.S.A.
  • Foreign Direct Investment- 
      • One of India's biggest direct investors is the United States.
      • From 1991 to 2004, the stock of FDI increased from US $11 million to $344.4 million.

  • Strategic Trade Authorization- In 2018 India became the third Asian nation to be granted Strategic Trade Authorization-1 (STA-1)status by the United States. The STA-1 enables the export of high-technology products and defense from the US to India.

Defense and Security Relations-

GSOMIA Agreement- General Security of Military Information (GSOMIA)- 

      • It was signed in 2002 between india and the U.S.A
      • GSOMIA paved the way for greater technology cooperation in the military sector.
      • It allows the sharing of classified information from the U.S. government and American companies with the Government of India and Defense Public Sector Undertaking but not with private defense companies.


      • The Logistics Exchange Memorandum of Agreement was signed between India and the US in August 2016. One partner trusts the other enough to expose its valuable assets.
      • It allows the military of both countries to replenish from the other bases- access supplies, spare parts, and services from the other countries' land facilities, air bases, and ports which can then be reimbursed.

COMCASA Agreement-

      • It stands for The Communications Compatibility and Security Agreement and was signed in September 2018. It means that one is confident that it can rely on an encrypted system to connect the two militaries.
      • It is an Indian-specific version of communication and information on the security memorandum of agreement (CISMOA). It is valid for a period of 10 years.
      • It allows the U.S. to provide India with its encrypted communications equipment and systems, so that Indian and U.S. military commanders, aircraft, and ships can communicate through a secure network in peace and war.

BECA Agreement- 

  • Basic Exchange and Cooperation Agreement- a pact with deep military implications. It can share highly classified information in real-time without fear of being compromised.
      • It largely pertains to geospatial intelligence and sharing information on maps and satellite images for defense.
      • Anyone sailing a ship, flying an aircraft, fighting wars, locating targets, responding to natural disasters, or navigating with a cell phone relies on geospatial intelligence.

Military exercises-

  • Yudh Abhyas-  bilateral military exercise
  • Vajra Prahar- joint military exercise between the special forces of India and the U.S.A.
  • Tiger triumph- first India -U.S. tri-services military exercises.
  • PASSEX- Passage Exercise between the navies of India and the U.S. in the Indian Ocean Region.
  • Malabar-  naval exercise between India, u.s., Australia, and Japan.
  • Cope India- air force exercise between India and the U.S.A.
  • 2+2 Ministerial dialogue- Conducted with India’s External Affairs and Defence Minister with their American counterparts, secretary of State, and Secretary of Defense w.r.t. strategic and security issues.
  • India has been given the status of ‘major defense partner’ by the U.S.A.
  • The Trump administration rephrased the word ‘Asia -Pacific' with the term ‘Indo- Pacific’. It includes the region from the west coast of India to the east coast of the U.S.A.
  • The USA comes under the list of top 5 arms exporters to India.
  • Defense technology and trade initiative (DTTI)- it simplifies technology transfer politics.

Multilateral relations-

  • G20- It is a premier forum for international economic cooperation. Both India and USA are members of this multilateral forum.
  • East Asia Summit- 
      • founded in 2005
      • It is a premier forum for strategic dialogue in the indo- pacific.
      • It has a total of 18 member countries which includes India and the USA.
      • The 6 priority areas of cooperation are-
        • Environment and Energy
        • Education
        • Finance
        • Global health issues and pandemic diseases
        • Natural disaster management
        • ASEAN Connectivity.
  • QUAD- 
    Also known as the quadrilateral dialogue, it includes countries namely India, Australia, USA, and Japan. The objective of this coalition is to secure the indo- pacific region from the Chinese expansion policy.

  • FATF-
    The financial action task force is a global financial crime watchdog. It has a total of 89 members which includes India and the USA.

Blue dot network- 

    • in order to promote high-quality trusted standards for global infrastructure development India and the US along with other proposed blue dot networks. 
    • It is an across-the-board certification process that aims to bring the government, the private sector and civil society together. 
    • It is seen as a counter to China's belt and road initiative.

Cultural relations-

  • P.M. Modi visited the U.S.A. in September 2019 and chaired the “Howdy Modi” event in Houston, Texas
  • Donald Trump visited India in Feb 2020 and chaired the “Namaste Trump” event in Ahmedabad, Gujarat.
  • Indian diaspora in American politics. They are an agent of soft power in the USA.
  • Indians have risen up to the top posts in the biggest corporate sectors in the USA and that is also affecting USA's policies towards India.

Energy relations-

  • India and the USA launched an energy dialogue in May 2005 to promote increased trade and investment in the energy sector by identifying further areas of cooperation and collaboration while working actively in both the public and private sectors.
  • An agreement for cooperation on the joint clean energy research and development center was signed between India and Russia in 2010.
  • Strategic energy partnership- launched by US and India in 2018 to enhance energy security and bolster strategic alignment. 
  • India has also started importing crude oil and LNG from the USA in the last 5-7 years.

Space cooperation-

  • Bilateral joint working group- working on space corporation has been established as a form for discussion on joint activity in space such as the exchange of scientists, INSAT, Mars mission, nano-satellites, earth science, international space stations, and space exploration.
  • ISRO- NASA- NISAR Project collaboration.
  • Cooperation in the health sector-

Four working groups- have been organized in the field of- 

    • disease prevention, 
    • maternal and child health, 
    • environment, and occupational health,
    • vaccine development.


    • The signing of the BECA Agreement may undermine India's military autonomy.
    • Removal of Generalized System of Preference (GSP)- 
      • The GSP was a provision where the developed country extended preferential trade arrangements to the developing countries. 
      • The US used to provide non-reciprocal duty-free treatment for certain countries for their imports into the US. 
      • Since India had been a beneficiary of this program, a lot of categories of goods into the US market did not drag any import duty but as soon as India was removed from GSP, it was placed on the same pedestal as other developed countries, attracting the equal amount of export duty that has hurt India’s exports to the U.S by a great margin.
    • H1B denials- US ramped up its H1B denials under the executive order “ Buy American and Hire American“.

Intellectual Property Rights- 

      • India has been on the USA's priority watch list which identifies countries posing challenges to American intellectual property rights,
      • Also, the US wants India to strengthen patent regulation and to ease the limitation that American companies investing in India face in India, and India is not obliged to do this. 
      • The U.S.A. threatens to put India as a'' priority foreign nation” under “ Special 301 Reports'' and accuses India of having poor IPR. e.g.- Novartis case.

Restrictions on API imports 

  • Solar panel case- India lost to WTO under the domestic content requirement clause and national treatment in procuring solar panels.
  • CAATSA- It is acting as an adversary in the case of India- Russia relations and india- Iran relations. The US has put unilateral curbs on Iranian imports into India through CAATSA and that has impugned India’s relations with Iran. similar is the case with Russia
  • Since 2018 both countries have been engaged in tariff wars. E.g in 2018 the US imposed an additional tariff of 25% on steel and 10% on aluminum imports from various countries including India. India’s refusal to remove the 20% tariff on ICT products caused the trade deal between India and USA to delay which still remains pending.
  • Similar to tariff war is the issue related to the WTO. India and the US are involved in WTO disputes on issues like the capping of prices of medical devices by India which the US does not like and greater Indian market access for American agriculture and dairy products which India is not allowing. This is leading to considerable differences between the two nations.
  • Afghanistan angle- America's withdrawal from Afghanistan has led to considerable divergences between India and US. The unilateral and untimely withdrawal of the USA from Afghanistan and handing over the government of Afghanistan on a plate to the Taliban has totally held India aback as it has totally impacted India’s investment in Afghanistan.

Policy towards Pakistan- In 2019 US decided to resume the international military education and training program that has been the central pillar of US- Pakistan military cooperation for years.

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