India and US still in search of a relationship
Opening a closed door is news. Opening windows after that is not. That, in a nutshell, was the difference between Prime Minister Manmohan Singh’s historic visit to Washington DC in July 2005 and his largely ceremonial visit earlier this week. The negotiations for a civil nuclear cooperation agreement that the prime minister and US President George Bush launched in 2005 made history by opening the door to a new phase in India-US relations. The new framework for US-India defence relationship signed in June 2005 and the nuclear deal marked a turning point in the relations between the two countries. Once that door was opened, few headline-grabbing initiatives were left. Aware of this reality, some India hands in the US urged President Barack Obama to declare US support for India’s membership of the UN Security Council as a potential door opener. True, that announcement would have grabbed headline space. Short of something as dramatic as that, the Singh-Obama meeting was destined to be just another summit, despite the grandeur of the ceremonial and celebratory part. However, one should not be misled by the absence of grand gestures to concluding that nothing happened. Much did. But it is in the nature of the India-US relationship, which is and will remain a friendship between “partners” rather than “allies”, that government-to-government relations will be overshadowed by business-to-business and people-to-people interaction. As civil society and business interactions go, US relations with India have no parallel in the non-OECD (Organisation for Economic Cooperation and Development), developing world. This got further strengthened during the prime minister’s visit with a slew of agreements covering the fields of business, knowledge, environment and culture.
To put it differently, the joint statement that came out of this week’s summit in Washington DC was about all the “other paragraphs” of the July 18, 2005 joint statement. That is, other than the famous para on the nuclear deal. If the nuclear deal defined the Singh-Bush era, cooperation on all other fronts, including defence, seems to define the Singh-Obama era. This is just as well since there is so much else India and the US can do together, including in the fields of defence, space and anti-terrorism action, that are vital to India’s development and security. However, if the last steps in the nuclear deal had been completed, it would have been the icing on the cake. Dr Singh must be disappointed that the “crossing of the Ts, and the dotting of the Is”, as he put it, could not be finished in time, even though negotiators from both sides spent the entire weekend trying to do precisely that. Does it suggest a hardening of stance on enrichment and reprocessing issues by the Obama administration? Or, was it because of poor legwork by our diplomats and bureaucrats? President Obama said he is committed to completing the nuclear deal and he would be well advised to do so in the interests of American companies that wish to invest in India. Removing barriers to high-tech trade with India would help American companies reduce the imbalance in trade. But for this partnership to blossom further, India has to invest in itself — in its people’s education and health, in skill-building and infrastructure. A stronger and more efficient India would be a more attractive partner.
Tax regime a sustained headwind for the stock, double-digit price rise to result in volume contraction
Firm will reduce leverage if it can get a premium for the properties