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FOREIGN SERVICE ACADEMY

(MINISTRY OF FOREIGN AFFAIRS)


ISLAMABAD

34TH SPECIALIZED DIPLOMATIC COURSE


(July-April 2014)

INDIA-US STRATEGIC PARTNERSHIP: IMPLICATIONS


FOR PAKISTAN

SUBMITTED BY:
JUNAID SULEMAN

SUPERVISOR:
ZAFAR NAWAZ JASPAL

Word count excluding Preliminaries and Bibliography = 4000

Executive Summary
The 21st century heralded the beginning of strategic partnership between worlds oldest and
largest democracies. Tectonic shift in geopolitics has prodded Washington to court New Delhi as
a counterweight to contain China. Motivated by its strategic vision to become a Great Power,
New Delhi has sought to transform its relations with Washington.
This paper argues that on both sides, high expectations of the relationship have dampened in
recent years. Cooperation in economic, defense and political areas has slowed down due to
Indian emphasis on strategic autonomy, protectionism, nuclear liability law and bureaucratic
hurdles. Notwithstanding its de-hyphenation policy, Washington recognizes that normalization of
India-Pakistan relations qualifies Pakistans role in supporting stability in Afghanistan. Growing
Sino-India economic ties have restrained New Delhi to confront Beijing. To Washingtons ire,
India has supported Moscow in the on-going Ukrainian Crisis. However, common interests and
shared values provide a sound foundation to India-US strategic partnership which does not
require a Cold War style alliance for its consummation. An open partnership, which considers
interests and priorities of both countries, would suffice. Being the only option in the region,
Washington has made a long-term strategic bet on New Delhi which explains its boundless
patience and its unprecedented efforts to build a constructive relation with its stubborn partner.
India-US strategic partnership would exacerbate military disparity between India and Pakistan
which would erode mutual nuclear deterrence. It would trigger arms race which would weaken
Pakistans economy. Buoyed by American support, New Delhi would pursue a more aggressive
policy vis--vis Pakistan. Pakistans stature in American foreign policy calculation would be
reduced. US-supported Indian role in Afghanistan would undermine Pakistans security.
In order to deal with new challenges emerging from India-US strategic partnership, Pakistan
should strengthen itself politically, economically and militarily. It should convince Washington
of its constructive role in normalization of India-Pakistan ties. It should work with new Afghan
government to check Indian-funded cross-border terrorism against Pakistan. It should
consolidate its strategic partnership with China. It should increase economic cooperation with
India and collaborate on non-traditional security threats. It should also engage Moscow and Iran.

List of Abbreviations

II

UNSC

United Nation Security Council

NSG

Nuclear Supplier Group

FDI

Foreign Direct Investment

USTR

United States Trade Representative

WTO

World Trade Organization

BIT

Bilateral Investment Treaty

EUMA

End-Use Monitoring Agreement

EEUMA

Enhanced End-Use Monitoring Agreement

MTCR

Missile Technology Control Regime

NPT

Nuclear Non-Proliferation Treaty

IAEA

International Atomic Energy Agency

TTP

Tehreek-i-Taliban Pakistan

BLA

Baloch Liberation Army

III

Table of Contents

Executive Summary

List of Abbreviations

II

Section 1: Introduction

1.1 Background

1.2 Statement of Problem 1


1.3 Literature Review

Section 2: India-US Strategic Partnership 4


2.1 Indian Objectives

2.2 American Objectives

Section 3: Dimensions of India-US Strategic Partnership


3.1 India-US Economic and Trade Relations
Overview

Trend

Issues

3.2 Security and Defense Cooperation

3.2.1 Defense Trade

3.2.2 Military to Military Cooperation

11

3.2.3 Counterterrorism and Intelligence Cooperation


3.2.4 Space and Ballistic Missile Cooperation
3.3 Civil Nuclear Cooperation
3.4 Political Dimension
3.4.1 China

13
13

3.4.2 Afghanistan 14
3.4.3 Pakistan

14

13

12

11

IV

3.4.4 Iran

15

3.4.5 Russia

15

3.4.6 Recent Developments

15

Section 4: Implications for Pakistan

16

Section 5: Conclusion and Recommendations

Bibliography 21

19

Section I
Introduction
1.1 Background:
India and America has figured prominently in Pakistans foreign policy. India and Pakistan share
a tortuous history of hostile relations due to territorial disputes and divergent strategic visions.
Islamabad has always considered Washington as an equalizer vis--vis New Delhi. A strategic
partnership has been forged between worlds superpower and Pakistans belligerent neighboring
country which would have far-reaching implications for Pakistan.
1.2 Statement of Problem:
Since 9/11, India-US bilateral relations have been on a positive trajectory. Presently, Washington
is bolstering India as a Great Power in South Asia which has the potential to emerge as a global
power. The cementing relations between India and US would have far-reaching ramifications for
regional strategic environment in particular and global politics in general. Pakistan cannot ignore
these developments due to its strategic competition with India. The primary objective of the
paper is to study the emerging contours of India-US relations and their likely implications for
Pakistan.
1.3 Literature Review:
Purpose of literature review is to evaluate existing body of knowledge on the topic and to
contextualize ones arguments. Essential materials which have been reviewed during the course
of this research are presented below:
In U.S.-India Strategic Partnership: Shared Vision, Different Prescription, Prem Trivedi argues
that though both India and America share broad-brush convergence of strategic visions,
particularly with regard to containment of China, they dont see eye to eye on appropriate means
to realize the potential of this strategic partnership. Indias reluctance to intervene outside

Subcontinent, its skepticism of Western-dominated multilateralism and its emphasis on strategic


autonomy are the main stumbling blocks.1
In Opportunities Unbound: Sustaining the Transformation in US-Indian Relations, while
appreciating irritants of the relationship, Ashley J. Tellis advocates that Washington should
continue to support New Delhi economically and militarily without any demand of reciprocity
from the latter because a stronger India fundamentally serves American self-interest in the
region.2
In India-US Security Relations: Current Engagement, K. Alan Kronstadt and Sonia Pinto have
contended that security and defense cooperation have flourished since 9/11. However,
bureaucratic hurdles and Indian stress on defense autarky have stymied progress. The authors
recommend that both New Delhi and Washington should take a strategic view of security
relations, warding off short-term, transactional approach.3
In India: Domestic Issues, Strategic Dynamics, and US Relations, Paul K. Kerr, Michael F.
Martin and K. Alan Kronstadt discuss the political, economic and nuclear dimensions of IndiaUS strategic partnership. Though the volume of bilateral trade has increased many folds during
last ten years, protectionism and India-US differences along North-South lines have emerged as
major areas of friction. Civil Nuclear Deal, 2008 has redefined the relationship but Indian
nuclear liability law has baulked its implementation.4

1 Prem Trivedi, U.S.-India Strategic Partnership: Shared Vision, Different Prescription, Foreign Policy,
October 2014, accessed November 7, 2014,
http://southasia.foreignpolicy.com/posts/2014/10/30/us_india_strategic_partnership_shared_vision_differ
ent_prescription.
2 Ashley J. Tellis, Opportunities Unbound: Sustaining the Transformation in US-Indian Relations,
Carnegie Endowment for International Peace, January 7, 2013, 11, accessed November 7, 2014,
http://carnegieendowment.org/2013/01/07/opportunities-unbound-sustaining-transformation-in-u.s.indian-relations.
3 K. Alan Kronstadt and Sonia Pinto, India-US Security Relations: Current Engagement,
Congressional Research Service, November 13, 2012, accessed November 8, 2014,
http://www.fas.org/sgp/crs/row/R42823.pdf.
2

In The Indo-US Strategic Relationship and Pakistans Security, Zafar Nawaz Jaspal is of the
view that Indo-US strategic partnership would disturb the strategic balance between India and
Pakistan. It would trigger conventional and non-conventional arms race in the region and would
lower the nuclear threshold between the belligerent neighbors.5

4 Paul K. Kerr, Michael F. Martin and K. Alan Kronstadt, India: Domestic Issues, Strategic Dynamics, and US
Relations, Congressional Research Service, September 1, 2011, accessed November 8, 2014,
http://fas.org/sgp/crs/row/RL33529.pdf.

5 Zafar Nawaz Jaspal, The Indo-US Strategic Partnership and Pakistans Security, SASSI Report 9 (2007),
accessed November 8, 2014, http://www.sassu.org.uk/pdfs/The%20Indo-US%20Strategic%20Relationship%20and
%20Pakistan%27s%20Security%20.pdf.

Section II
India-US Strategic Partnership
2.1 Indian Objectives
The principal driver behind New Delhis transformation of its ties with Washington lies in its
strategic vision to become a Great Power:
1. Washington wields unparalleled influence in global governance institutions. New Delhi
seeks American support to enhance its political status in international arena by becoming
member of exclusive clubs like UN Security Council (UNSC), Nuclear Supplier Group
2.

(NSG), G-8 etc.


In order to transform its economy, India needs American capital, managerial expertise

and technology.
3. It wants to build a credible, offensive military force to meet its strategic objectives.
American cutting-edge defense industry promises sophisticated military hardware in this
regard.
4. New Delhi wants to ensure a peaceful neighborhood to facilitate its rise. Being a status
quo power, it sees Pakistan as spoiler of regional peace. Thus, it seeks to reduce
American political support and military and economic assistance for Islamabad.
5. New Delhi aims to contain China which is disturbing strategic balance in the region and
intruding in its traditional sphere of influence.
6. New Delhi wants to project soft power in American society and expands its influence in
American policymaking circles by incorporating services of Indian Diaspora.6
2.2 American Objectives
6 Mr. Muhammad Syrus Sajjad Qazi, interviewed by author, December 8, 2014.

The principal driver behind American pursuit of a strategic partnership with India lies in tectonic
shift in geopolitics which challenges its primacy:
1. Given Chinas growing assertiveness, America aims to maintain balance of power in Asia
which is not inimical to its interests. It envisages India as a potential counterweight.
2. Washington considers India as a guarantor of arc of peace and economic prosperity
extending from East Africa to Strait of Malacca due to its unique geopolitical location
and shared democratic values.
3. America considers India to be an economic partner of choice due to its educated middle
class, its open economy and market size. It believes that a strong India-US relation will
revitalize its stagnant economy by providing trade and investment opportunities.
4. Indian military demands also provide lucrative economic opportunities for American
defense industries.

Section III
Dimensions of India-US Strategic Partnership

3.1 India-US Economic and Trade Relations:


Overview
India is currently Americas 11th largest goods trading partner. The top exports from America to
India in 2013 were precious stones, aircrafts, machinery and medical instruments while the five
largest American imports from India were precious stones, pharmaceutical products, mineral
fuel, chemicals and textile articles.7
In 2013-2014, total bilateral trade amounted to $96.8 billion. America had a trade deficit of $25.4
billion. Category-wise facts and figures are given in Table no. 1.8
For America, education and tourism was the largest services exports to India while outsourcing
of jobs by American businesses, especially in IT sector, was the leading services import from
India.9

7 India, Office of the United States Trade Representative, Last modified: November 15, 2014.
http://www.ustr.gov/countries-regions/south-central-asia/india.
8 Trade News Release, US Department of Commerce: Bureau of Economic Analysis, Last modified:
November 15, 2014, http://www.bea.gov/newsreleases/international/trade/tradnewsrelease.htm.
9 Joshua Meltzer, Growing the India-US Trade and Investment Relationship, The Brookings Institution,
September 2014, accessed November 15, 2014, http://www.brookings.edu/research/opinions/2014/09/23india-us-trade-investment-relationship-meltzer .
6

American foreign direct investment (FDI) in India was $28.4 billion in 2012, mainly in technical
services, manufacturing, and finance and information sectors. India FDI in the United States was
$5.2 billion in 2012, primarily concentrated in the professional services and banking sectors.10

Table 1: India-US Trade in 2013-201411


US EXPORT IN

US IMPORT IN

GOODS

INDIAN GOODS

DEFICIT IN

22.2
US EXPORT IN

42
US IMPORT IN

64.2
TRADE IN

GOODS
19.7
US TRADE

SERVICES

INDIAN SERVICES

SERVICES

DEFICIT IN

13.5
TOTAL EXPORT

19
TOTAL IMPORT

32.4
TOTAL TRADE

SERVICES
5.6
TOTAL US TRADE

96.8

DEFICIT
25.4

35.7

TRADE IN GOODS

61.1

US TRADE

Note: All amounts are in billions of US dollars.

10 India, Office of the United States Trade Representative, Last modified: November 15, 2014.
http://www.ustr.gov/countries-regions/south-central-asia/india. Note: Latest official figures for investment are
available for the fiscal year 2012-13.

11Trade News Release, US Department of Commerce: Bureau of Economic Analysis, Last modified: November
15, 2014, http://www.bea.gov/newsreleases/international/trade/tradnewsrelease.htm. Note: Table is formulated using
data from Bureau of Economic Analysis.

Trend
In the last ten years (2003-2013), total bilateral trade had increased by 400 percent with notable
600 percent growth in trade in services. American trade deficit with India has increased to $25.4
billion in 2013, up from $6.3 billion in 2003. It is mainly concentrated in services sector even
though the U.S. runs a services trade surplus with the rest of the world. American FDI in India
has also increased by 600 percent while Indian investment in the U.S. has experienced 1,400
percent growth since 2003.12
Issues
Following issues have hampered bilateral trade and investment:
1. Indian disregard for intellectual property protection rights is a major bone of contention.
United States Trade Representatives (USTR) Special 301 Report, 2014 placed India on
Priority Watch List. Out-of-Cycle Review has been initiated in fall of 2014 which could
entail some trade restrictions. America is of the view that Indian Patent Act, particularly
its Section 3 (d), may have the effect of limiting the patentability of potentially beneficial
innovations.13
2. Due to investment and trade barriers, Americans have limited access to Indian market
especially in agricultural and multi-brand retail sectors. Though Congress government
announced retail reform package in 2011, strict conditions have discouraged FDI in
multi-brand retail. India has also restricted import of American subsidized agricultural
goods which, in its view, would threaten livelihood of its farmers.
3. America sees Indian protectionism as hurdle to global trade liberalization. Both countries
have clashed at Doha Round along North-South lines. They have resorted to World Trade
12 Joshua Meltzer, Growing the India-US Trade and Investment Relationship, The Brookings
Institution, September 2014, accessed November 15, 2014,
http://www.brookings.edu/research/opinions/2014/09/23-india-us-trade-investment-relationship-meltzer .
13 Office of the United States Trade Representative, 2014 Special 301 Report (Washington DC: Office of
the United States Trade Representative, 2014), 40.
8

Organization (WTO) time and again for settlement of trade disputes. Recently, there was
difference between the two countries over Trade Facilitation Agreement. However, an
agreement was reached in November, 2014 when America accepted Indian food security
concerns.14
4. So far, India and America have failed to sign a bilateral investment treaty (BIT). From
American perspective, limits on foreign ownership, local contents requirement and
technology transfer obligations are the main sticking points. On the other hand, India
considers American insistence on enforcement of labor and environmental laws stymieing
BIT. New Delhi is concerned that it would be required more to yield in terms of
regulatory space and the burden of reform will fall disproportionately on it.15
5. Protectionists have raised hue and cry about deleterious impact of employment of
immigrants and services outsourcing on job opportunities for Americans. This has led to
passing of an immigration bill by Senate in 2013. Its section 4304 essentially bans
companies that employ between 50 to 75% of their workforce on H-1B or L1 visas which
includes all Indian IT companies.16 As a similar bill has not been passed by House of
Representatives, these restrictions are not effective. On the other hand, India has
demanded an increase in H-1B visa cap for its skilled labor.

3.2 Security and Defense Co-operation


3.2.1 Defense Trade
14 Statement by Ambassador Froman on US-India WTO Trade Facilitation Agreement, Office of the
United States Trade Representative, Last Modified November 30, 2014.
15 Mathew Stokes, BIT and beyond: Advancing the US-India Economic Relationship, Centre for
Strategic and International Studies, November 2012, p.25, accessed November 17, 2014,
http://csis.org/files/publication/121126_Stokes_BITandBeyond_web.pdf.
16 S.744, Border Security, Economic Opportunity, and Immigration Modernization Act, 1st Session, 113th
Congress, 2013, Section 4304, p. 967.
9

In post- 9/11 era, there has been a significant upward trend in Indian arms purchase from
America which has increased to $981 million in 2013 from $1 million in 2000 (Chart no. 1
below). America has displaced Russia as its biggest arms supplier in 2013-14.17 Defense trade
has allowed Indian access to more sophisticated military hardware.
Defense trade between India and America is complicated by a host of factors. There is currently a
strategic dissonance. Washington judges success on how defense trade would translate into an
alliance in Asia. India, by contrast, judges success on how much Washington will assist it in
building its indigenous defense capabilities while maintaining freedom of its foreign policy
options18. Bitter historical experience of arms sanctions has also engendered trust deficit in
Indian policymakers to consider America as a reliable arms supplier.

17 Gill Palmer and Victor Mallet, India becomes Biggest Foreign Buyer of US Weapons. Financial
Times, February 24, 2014, accessed November 25, 2014, http://www.ft.com/intl/cms/s/0/ded3be9a-9c8111e3-b535-00144feab7de.html#axzz3KtjAkoHM
18 S. Amer Latif, US-India Defense Trade: Opportunities for Deepening the Partnership, Centre for
Strategic and International Studies, June 2012, p. IX, accessed November 19, 2014,
http://csis.org/files/publication/120703_Latif_USIndiaDefense_Web.pdf .
10

India-US Defense Trade


1200
981

1000
800

Million Dollars

600
400
200
0

74 87

54

203
139

Chart No.1: India-US Defense Trade (2000-2013)19

Washington is also concerned about transfer of its sold defense technology to its strategic
competitors like China and Russia. Therefore it has sought inspections under End-Use
Monitoring (EUMA) and Enhanced End-Use Monitoring (EEUMA) agreements.20
Indian weapons procurement process works on lowest bidder system where the company
offering the lowest price for listed military goods wins the tender. American companies are at a
disadvantage since they offer advanced defense equipments at high price.21

19 Arms Transfer Database, Stockholm International Peace Research Institute, Last Modified: November 19,
2014, http://www.sipri.org/databases/armstransfers/background.Note: Chart is plotted using data from above source.

20 Brahma Chellaney, Factsheet on U.S-India Accord on End-Use Monitoring, India Abroad, July 31,
2009, accessed November 25, 2014, http://chellaney.net/2009/07/22/factsheet-on-u-s-india-accord-onend-use-monitoring/.
11

Indian Defense Procurement Policy, 2013 demand that 30% of any defense deal valued at more
than Rs.3 billion has to be reinvested in India as an offset in form of co-production. 22 American
companies have remained critical of this policy due to poor capacity of Indian defense industries
to absorb investment.
3.2.2 Military-to-Military Co-operation
India now conducts more exercises and personnel exchanges with America than with any other
country; more than 50 formal events are occurring annually.23
Formal and informal contacts among servicemen of both countries have improved coordination
and communication mechanisms between the two armies. Driven by convergence of interest in
Indian Ocean, navy-to-navy co-operation appears to be growing more robustly in comparison to
other services. However, New Delhi remains partial to UN-endorsed multilateral initiatives over
purely bilateral exercises because it does not want to project any defense alliance with America
against China. 24
3.2.3 Counterterrorism and Intelligence Cooperation
In post-9/11, India-US counterterrorism and intelligence cooperation has been on a positive
trajectory. Under Anti-Terrorism Assistance Plan for India, the State Department has trained
more than 2,000 Indian personnel for critical incident management and investigation.25 After

21 K. Alan Kronstadt and Sonia Pinto, India-US Security Relations: Current Engagement,
Congressional Research Service, November 13, 2012, p.29, accessed November 25, 2014,
http://www.fas.org/sgp/crs/row/R42823.pdf.
22 Indian Ministry of Defense, Defense Procurement Procedure, 2013(New Delhi: Ministry of Defense,
2013), 52.
23 K. Alan Kronstadt and Sonia Pinto, India-US Security Relations: Current Engagement,
Congressional Research Service, November 13, 2012, p. 8, accessed November 19, 2014,
http://www.fas.org/sgp/crs/row/R42823.pdf.
24 Ibid.
12

Mumbai attack 2008, American forensic experts were allowed access to gathered evidence while
Indian investigators were permitted to question David Headley.
American concurrence with Indian threat perception emanating from Pakistan-sponsored terrorist
groups has bolstered counterterrorism cooperation at a strategic plane. However, institutional
hiccups cast a gloomy shadow over tactical collaboration. With states being the primary law
enforcer in India, there is no national-level authority with which America can engage. The
proposed National Counter-Terrorism Centre exists only in paper due to opposition from various
intelligence agencies in India. There is suboptimal alignment of U.S. and Indian bureaucracies
which has resulted in poor interagency communication and coordination.26 Indian sensitivity
regarding exposing its intelligence setup to foreign country has also hampered effective
cooperation.

3.2.4 Space and Ballistic Missile Cooperation


America has supported Indian Space and Ballistic Defense Missile programmes. It has amended
its Export Administration Regulations by removing all Indian defense and space entities from the
Department of Commerces Entity List in 2011. It has added India to a preferential Country
Group which consists of members of the Missile Technology Control Regime (MTCR). 27As a
result, India can now buy dual-use technology from America. The latter has also supported the
transfer of Arrow missile technology by Israel. Budgetary restraints, Indian focus on developing
indigenous technology and weak implementation of export controls by India have slowed the
pace of cooperation.
25 US Department of State, Antiterrorism Assistance Program Review 2012(Washington DC: State Department,
2012), accessed November 19, 2014, http://www.state.gov/documents/organization/215593.pdf.

26 S. Amer Latif, US-India Defense Trade: Opportunities for Deepening the Partnership, Centre for
Strategic and International Studies, June 2012, accessed November 19, 2014,
http://csis.org/files/publication/120703_Latif_USIndiaDefense_Web.pdf .
27 US Government removes Indian Organizations from Entity List, USA Embassy New Delhi, Last
Modified November 7, 2014.
13

3.3 Civil Nuclear Cooperation


Civil Nuclear Deal, 2008 changed the strategic context of India-US relations. From American
viewpoint, the deal was meant to influence Indian answer to the question whether New Delhi
would join Washington in containment of China or not. 28 It also changed the nuclear world order.
India got a waiver from NSG without being a signatory to Non-Proliferation Treaty (NPT). As
result, India can now acquire nuclear fuel and plants from international markets and can
participate in international nuclear research and development.29
Several factors have stalled effective implementation of the deal. American companies have their
reservations about legal liabilities under Indian Civil Liability for Nuclear Damage Act, 2010. Its
Section 17(b) gives Indian government the right to sue suppliers in case of nuclear disasters. 30
Washingtons delay in according clearances to American companies under Code of Federal
Regulations Part 810 and its insistence on end-user verification visits have stymied progress. 31

28 Ashley J. Tellis, Opportunities Unbound: Sustaining the Transformation in US-Indian Relations,


Carnegie Endowment For International Peace, January 7, 2013, p. 11, accessed November 7, 2014,
http://carnegieendowment.org/2013/01/07/opportunities-unbound-sustaining-transformation-in-u.s.indian-relations.
29 Wade Boese, Nuclear Deal Centre Stage for US and India, Arms Control Today, March 2006,
accessed on November 30, 2014, http://www.armscontrol.org/act/2006_03/MARCHusindia.asp.
30 38, Civil Liability for Nuclear Damage Act, 15th Indian Parliament, Section 17(b), p. 8.
31 W.P.S. Sidhu, Re-energizing India-US Civil Nuclear Cooperation, The Brookings Institution,
September 2014, accessed November 30, 2014, http://www.brookings.edu/research/opinions/2014/09/23reenergizing-india-us-civil-nuclear-cooperation-sidhu .
14

There are also differences regarding unit energy cost between Westinghouse and Nuclear Power
Corporation of India Limited.

3.4 Political Dimension:


3.4.1 China:
Washington considers India as a counterweight to China in its Asia Pivot strategy. Suffering from
"status anxiety", India is also trying to catch up with a more assertive China. 32It sees Chinas
String of Pearls policy as its encirclement. It also views Sino-Pakistan strategic partnership as
a destabilizing factor in the region. Chinese claims on islands in South China Sea clash with
Indian economic and maritime interests. As a result, American presence in the region has
received tacit welcome from New Delhi.
Chances of a formal alliance are blurred due to Indian emphasis on strategic autonomy. India has
not been included in Trans-Pacific Partnership which is the economic arm of Asia Pivot
strategy.33 On the other hand, Sino-India economic relations have registered an upward trend
with $66 billion worth trade in 2013. Both countries have agreed that unsolved territorial
disputes will not affect their economic ties. Chinese response to growing India-US relations has
been uncritical, giving it appearance of one-sided strategic rivalry. Direction of Sino-US and
Sino-India relations, and Chinese aggressiveness would determine India-US embrace in this
regard.
3.4.2 Afghanistan:

32 Esther Pan, India, China and United States: A Delicate Balance, Council on Foreign Relations,
February 2006, accessed November 30, 2014, http://www.cfr.org/india/india-china-united-states-delicatebalance/p9962#p3.
33 Atul Aneja, India wont Join anti-China Coalition led by US, The Hindu, October 1, 2014, accessed
November 30, 2014, http://www.thehindu.com/news/international/world/postprime-minister-narendramodis-us-visit-china-says-india-would-not-join-antibeijing-coalition-led-bywashington/article6465509.ece.
15

India and America both envisage a stable Afghanistan which does not become a safe haven for
terrorist networks. Washington also sees India as a linchpin of New Silk Route. However, India
worries that American planned troops drawdown would lead Washington to accept Pakistans
influence in Afghanistan which it considers detrimental to its strategic interests. 34 It has viewed
with suspicion American backdoor negotiation with Afghan Taliban in Doha because it has
opposed the latters inclusion in any future dispensation. To Washingtons ire, New Delhi
supports Irans role in Afghanistan.
3.4.3 Pakistan:
Despite being a frontline ally in War on Terrorism, America has decoupled Pakistan from India in
its strategic calculus. But Washington recognizes that Pakistan has an influential role to play in
Afghanistan endgame. It also supports normalization of ties between the two nuclear states
which would directly affect situation in Afghanistan. India is concerned about the military
assistance provided to Islamabad which, it believes, would be used against it.

3.4.4 Iran:
Traditionally, India enjoys cordial ties with Iran but its policy towards Tehran has shifted slowly
under American pressure. Though India supports Irans right to peaceful use of nuclear
technology, it has urged Tehran to abide by its international obligations under NPT. India has
voted in favor of International Atomic Energy Agency resolution, 2006 and UNSC sanctions,
2012 against Iran. It has significantly reduced oil import from Iran, constituting only 6% of total
oil import, down from 16% in 2008.35 To Washingtons chagrin, India has so far refrained from
complete disengagement from Iran. It has also opposed any military action against Iran.
3.4.5 Russia:
34 Sumit Ganguly, Afghanistan is Now Indias Problem, Foreign Policy, July 2009, accessed December 1, 2014,
http://foreignpolicy.com/2011/07/19/afghanistan-is-now-indias-problem-2/.

35 Tanvi Mandan, Indias Relations with Iran: Its Complicated, The Brookings Institution, February
2014, accessed November 30, 2014, http://www.brookings.edu/blogs/markaz/posts/2014/02/28-iran-indiacomplicated-relationship-madan.
16

Historically, New Delhi has a special and privileged strategic partnership with Moscow. Close
India-Russia ties has been a major irritant in India-US relations. India tacitly supported Putins
annexation of Crimea by acknowledging Russias legitimate interests and disapproved American
and European Union sanctions against Russia.36 Indian position on Ukraine Crisis has raised
suspicion in Washington regarding reliability of New Delhi as a strategic partner.
3.4.6 Recent Developments:
Prime Minister Modi has pledged to revive Indian economy through implementation of businessfriendly policies. He has also announced $100 billion military upgradation programme and has
increased FDI cap from 26% to 49% in defense sector. All this would present America with new
business opportunities. Modis Act East policy dovetails with American Pivot to Asia which
would lead to greater convergence between the two to contain China. But Modis aggressive
policy vis--vis Islamabad and his vow to revise Indian nuclear doctrine would require delicate
balancing on part of Washington as American troops begin to withdraw from Afghanistan.37
Section IV
Implications for Pakistan
India-US strategic partnership has far-reaching implications for Pakistans foreign policy,
security and economy as discussed below:
1. Washington is bolstering India as a regional power. Given its hegemonic designs, New
Delhi would persuade it to endorse status quo in the region. Buoyed by American
support, New Delhi would pursue a more aggressive policy vis--vis Pakistan which
would hamper conflict resolution and bilateral and regional economic cooperation.
2. American tilt in favor of India would undermine Pakistan-US relations. It would
reinforce its tactical, transactional nature. India-Pakistan decoupling policy would put
36 Media Briefing by National Security Adviser, Ministry of External Affairs, Last modified
November 30, 2014, http://www.mea.gov.in/media-briefings.htm?
dtl/23042/Transcript+of+media+briefing+by+National+Security+Advisor+March+06+2014.
37 Ambassador Shafkat Saeed, interviewed by author, December 9, 2014.
17

limits to American political, economic and military support and assistance for Pakistan.
The latter would be compelled to look for for new strategic partners and diversify its
relations. Moreover, if India and America decide to formalize a defense alliance against
China in future, Pakistan would have to make difficult foreign policy choices.
3. Washingtons support for Indian role in Afghanistan would exacerbate security problems
faced by Pakistan. India has been allegedly training and funding Tehreek-i-Taliban
Pakistan (TTP) and the Baloch Liberation Army (BLA) from its consulates in
Afghanistan. Indian footprint on Pakistans western border would lead to two-front war
situation.
4. Under Civil Nuclear Deal 2008, India would be able to acquire nuclear fuel and plants for
civilian purposes. Given the voluntary nature of safeguard agreement with IAEA, it could
always divert civil nuclear technology for military purposes. To maintain nuclear balance,
Pakistan would have to accelerate production of fissile material significantly. As a result,
it would not withdraw its veto on Fissile Material Cut-Off Treaty in the near future.
5. India-US defense trade would equip Indian forces with sophisticated conventional arms.
It would aggravate the conventional military disparity between India and Pakistan,
triggering an arms race in the region.
6. Introduction of Ballistic Missile Defense in Indias arsenal would minimize its
vulnerability to Pakistan missile strikes. As a result, Pakistan would be compelled to
increase its missile inventory or to acquire Ballistic Missile Defense technology. Indian
invulnerability could also encourage it to embrace limited warfare doctrines like Cold
Start.38
7. Military to military cooperation would increase capability of Indian forces, posing
operational challenges to Pakistan army. In September 2003, Indian and American forces
conducted joint exercises in Karakorum Range close to Siachen Glacier. Such exercises
38 Zafar Nawaz Jaspal, The Introduction of Ballistic Missile Defense in South Asia: Implications on
Strategic Stability, Centre on Contemporary Conflict, June 2014, accessed December 3, 2014,
http://www.nps.edu/Academics/Centers/CCC/Research/NuclearLearning/11%20Nuclear
%20Learning_Jaspal.pdf.
18

have increased combat experience of Indian army in Siachen Glacier, making the
resolution of this dispute less likely.39
8. Strategic stability between India and Pakistan is based on mutual nuclear deterrence. The
latter would be eroded if India continues to build its conventional and non-conventional
arsenal with American help.
9. In order to maintain the strategic balance, Pakistan would have to increase its defense
budget which would weaken its fragile economy. It would be left with meager resources
for socio-economic development. In the last five years, the defense expenditure has
almost been doubled from around 350 billion in 2009-10 to Rs700 billion for the fiscal
year 2014-15.40
10. India has become an attractive country for American investors. Companies like
Microsoft, Dell, Ford Motor and Boeing have invested heavily in India. This trend would
increase confidence of other foreign businessmen to invest in it as well. As result, there
would be more regional competitiveness for Pakistan to attract FDI.
11. If India becomes member of major arms control regimes like NSG, Pakistan exclusion
would become permanent due to their unanimous decision-making procedure.41
12. Indian permanent membership in UNSC would shelve its resolutions on Kashmir issue
for good. Indian veto power would be undermine Pakistans interests beyond measure.

39 Zafar Nawaz Jaspal, The Indo-US Strategic Partnership and Pakistans Security, SASSI Report 9
(2007), accessed November 8, 2014, http://www.sassu.org.uk/pdfs/The%20Indo-US%20Strategic
%20Relationship%20and%20Pakistan%27s%20Security%20.pdf.
40 Ismail Sheikh and Kamran Yousaf, Budget 2014: Government announces 700 billion Defense
Budget, Tribune, June 3, 2014, accessed on December 4, 2014,
http://tribune.com.pk/story/716913/budget-2014-defence-budget-increasing-at-diminishing-rate/.
41 Mr. Muhammad Syrus Sajjad Qazi , interviewed by author, December 8, 2014.
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Section V
Conclusion and Recommendations
To conclude, the post-9/11 era witnessed the beginning of strategic partnership between India
and America. However, high expectations for active engagement in various areas have been
moderated in recent years due to Indian emphasis on strategic autonomy and defense autarky,
barriers to trade and investment, nuclear liability law and bureaucratic hurdles. Growing
economic interdependence between India and China has put a limit to New Delhis willingness to
confront the latter. To Washingtons ire, India has supported Russia in Ukrainian Crisis.
Notwithstanding its decoupling approach, Washington recognizes Pakistans role in Afghanistan
which, it believes, is conditioned by normalization of Indo-Pakistan relations.
Broadly speaking, India-US relations stand on sound foundation due to mutual interests and
shared values. It does not need a Cold War style alliance for its fruition. An open partnership,
which serves interests of both countries, would suffice. India acknowledges that it needs America
more than ever if it is to become a Great Power. On other hand, despite being a difficult partner
to deal with, Washington has made a long-term strategic bet on its only option in the region
which explains its limitless patience and its unprecedented efforts to build a constructive relation
with India.
India-US strategic partnership would have serious implications for Pakistans foreign policy,
security and economy. In this regard, following policy recommendations are suggested:
20

1. In order to deal with new challenges emerging from Indo-US strategic partnership,
Pakistan should strengthen itself domestically. It should revitalize its stagnant economy
and ensure political stability. It should address root causes of its security problems in
tribal areas and Balochistan.
2. Pakistan should review its conventional and non-conventional capabilities and plug gaps
where economically possible. It should expand its indigenous capacity to manufacture
military hardware. It should continue to maintain credible nuclear deterrence vis--vis
India.
3. Pakistan should convince Washington that normalization of India-Pakistan is sine quo
non for regional stability and that it has a constructive role to play in this regard. It should
also broaden its relations with America beyond security imperatives to active economic,
defense and political engagement.
4. Pakistan should support Afghan-led and Afghan-owed reconciliation process. It should
work with new Afghan government to check Indian-funded cross-border terrorism against
Pakistan. It should also calibrate its policy with Beijing, Moscow and Tehran on
Afghanistan.
5. Pakistan should consolidate its strategic partnership with China. It should continue to
enhance bilateral cooperation in economic, defense and nuclear sectors.
6. Pakistan should increase economic cooperation with India. Both should collaborate on
non-traditional security threats like climate change, drug trafficking and natural disasters.
They should work to resolve less contentious disputes like Sir Creek, Siachen etc.
7. Bilateralism should be the guiding principle of Pakistans foreign policy. It should not let
its relations with one country influence its relations with the other. It should
constructively engage Moscow and Tehran and cultivate mutually beneficial ties with
them.

21

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