$15-bn deals give US 72,000 jobs; India gets seat at global high table
As President Barack Obama wound up his India visit, the US today promised to help New Delhi in its bid for permanent membership of the United Nations Security Council and several non-proliferation clubs. Membership to these clubs had been denied because India is not a signatory to the Nuclear Non-Proliferation Treaty. Washington also took India off the ‘Entities List’ and decided to jointly set up a centre for research in civilian nuclear energy.
Obama’s speech in Parliament received effusive response that bordered on the triumphant, because it acknowledged that India had a place at the high table. Obama also said Pakistan must punish those behind the Mumbai attack: “We will continue to insist to Pakistan’s leaders that terrorist safe havens within their borders are unacceptable, and that the terrorists behind the Mumbai attacks be brought to justice.”
He asked India to act like a big power to be recognised as a big power. In the context of Myanmar, he said: “If I can be frank, in international fora, India has often avoided these issues. But, speaking up for those who cannot do so for themselves is not interfering in the affairs of other countries. It’s not violating the rights of sovereign nations. It’s staying true to our democratic principles.” This brought some disapproval from Indian MPs.
But in order to deflect criticism at home, Obama’s visit was also about creating American jobs. With Prime Minister Manmohan Singh, he entered into an agreement for the purchase of 10 C-17 Globemaster cargo planes by the Indian Air Force, to be made by Boeing at its facility in Long Beach, California. The contract, through the foreign military sales route, is worth $5 billion and will create 22,000 jobs in the US.
An earlier set of agreements between US and Indian companies will create 50,000 jobs in the US and result in commerce amounting to $10 billion, addressing American fears about job losses and the political costs of outsourcing. “India is not in the business of stealing jobs from the US. Our outsourcing industry has helped US companies to compete and improve US productivity,” said Prime Minister Manmohan Singh at a joint press conference.
“I dont think you’ve heard me make outsourcing a bogeyman... both our countries have lived on stereotypes that have outlived their usefulness. The deals have win-win potential. They will create jobs in the US it is true, but those same technologies will also allow Indian entrepreneurs to create jobs here,” Obama said.
India and the US have also signed an agreement for cooperation in the field of shale gas, although details are to be fleshed out. A $10-billion infrastructure debt fund will be set up to finance public-private partnership projects in the roads, bridges, ports and railway sectors.
Although several of the deals inked during the visit were concluded earlier, they are expected to create political goodwill and bonhomie in a climate of mistrust and suspicion in the aftermath of revelations that US shared intelligence selectively with India ahead of 26/11.
Action on the Entities List is one such. The US announced that Bharat Dyanamics, Defence Research & Development Organisation (DRDO) and Indian Space Research Organisation (ISRO) would be taken off the list. Bhabha Atomic Research Centre would continue to remain on it.
Non-proliferation expert G Balachandran said that if last year the gates of the US department of commerce had remained closed to some Indian scientific establishments like DRDO and ISRO because they were on the Entities List, the US’s action in taking them off the list would not mean that these gates would suddenly open this year.
”We have to see this in perspective. The Entities List is a set of organisations in 24 countries. These, among other things, are thought by the US to be contributing to a programme to develop weapons of mass destruction. Indian institutions may have been taken off this list now. But this doesn’t mean they will suddenly have access to equipment denied before," said Balachandran.
|THE FINE PRINT
Salient points of the Indo-US joint statement
# India-US strategic partnership is indispensable not only for both countries, but also for global stability and prosperity in the 21st century
# The United States looks forward to a reformed United Nations Security Council that includes India as a permanent member
# US intends to support India’s full membership in NSG, Missile Technology Control Regime, Australia Group & Wassenaar Arrangement
# US to remove Indian entities from the department of commerce ‘Entity List’ and realign India in US export control regulations
# Reiterates commitment to build strong India-US civil nuclear energy cooperation through participation of US nuclear energy firms
"All that will happen now is, when India knocks at the gate, the US will ask the gatekeepers who it is and listen to what India wants. But a licensing regime will continue to be in place,” he explained. Balachandran said this move will have no implications for the Indian private sector.
Even as Obama was confabulating in Hyderabad House, private sector US and Indian businesses had their own meeting organised by CII and US India Business Council. While they noted the giant strides taken by the two countries in the last few years, businesses also recounted some peeves.
The Americans said doing business with India still required too much paperwork and bureaucracy. Indians said Americans often made snap judgements about India – for instance, India was on a US labour department watch-list since 2009 for the use of child labour in the apparel sector on the basis of “sketchy information and a few media reports”.