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The Indo-US relationship after the 9/11 attacks underwent significant changes,
leading to a closer alignment between the two countries in various areas. Here
is a detailed examination of the Indo-US relationship post-9/11:
3. Nuclear Cooperation: The signing of the US-India Civil Nuclear Deal in 2008
was a landmark development in the relationship. It allowed India access to
civilian nuclear technology and fuel, despite not being a signatory to the
Nuclear Non-Proliferation Treaty. The deal symbolized the strengthening
strategic partnership between the two countries.
5. Diplomatic Engagement: The 9/11 attacks brought India and the US closer
diplomatically. High-level visits, exchange of delegations, and regular
consultations became a common feature. The countries started engaging in
strategic dialogues, joint statements, and other diplomatic mechanisms to
foster greater understanding and cooperation on various global issues.
Overall, the 9/11 attacks consolidated the Indo-US relationship and led to a
comprehensive partnership between the two countries. It significantly
enhanced cooperation in counterterrorism, defense, nuclear energy, trade,
diplomacy, and regional security. The relationship has continued to evolve and
deepen over the years, based on shared democratic values, economic interests,
and strategic cooperation.
An Agreement on Framework for Cooperation on Trade and Investment was signed during
the visit of Minister for Commerce & Industry, Mr. Anand Sharma to the USA in March
2010. As part of the Economic Dialogue, a separate Commercial Dialogue has been set up to
cover:
For greater involvement of the private sector in a discussion on issues involving trade and
investment the bilateral India-US CEO’s Forum was reconstituted in 2009. The fourth round
of the reconstituted CEOs’ Forum to facilitate a structured dialogue between the industry and
the government was held on 22 September 2011 at Washington DC. Separately a Private
Sector Advisory Group (PSAG) has also been created consisting of prominent Indian and
international trade experts to provide strategic recommendations and insights to the US-India
Trade Policy Forum.
In 2017, the US exported $25.7 billion worth of goods to India, and imported $48.6 billion
worth of Indian goods Major items imported from India include information technology
services, textiles, machinery, gems and diamonds, chemicals, iron and steel products, coffee,
tea, and other edible food products. Major American items imported by India include aircraft,
fertilisers, computer hardware, scrap metal, and medical equipment
The United States is one of India's largest direct investors. From 1991 to 2004, the stock of FDI
inflow has increased from US$11 million to $344.4 million, and totaling $4.13 billion. This is a
compound rate increase of 57.5 percent annually. Indian direct investments abroad began in
1992, and Indian corporations and registered partnership firms now can and do invest in
businesses up to 100 percent of their net worth. India's largest outgoing investments are in the
manufacturing sector, which accounts for 54.8 percent of the country's foreign investments. The
second largest are in non-financial services (software development), accounting for 35.4 percent
of investments. According to the data of the commerce ministry, in 2021–22, bilateral trade in
goods between the two countries crossed $119.42 billion. Exports to the US increased to $76.11
billion in 2021-22 from $51.62 billion in previous fiscal year, while imports rose to $43.31 billion
as compared to about $29 billion in 2020–21.
Trade relations
U.S. President George W. Bush and Indian Prime Minister Manmohan Singh during a
meeting with Indian and American business leaders in New Delhi.
The US is India's largest trading partner since 2021,[245] and India is its 7th largest trading partner.
[246]
In 2017, the US exported $25.7 billion worth of goods to India, and imported $48.6 billion
worth of Indian goods.[247] Major items imported from India include information
technology services, textiles, machinery, gems and diamonds, chemicals, iron and steel products
, coffee, tea, and other edible food products. Major American items imported by India
include aircraft, fertilisers, computer hardware, scrap metal, and medical equipment.[248][249]
The United States is also India's largest investment partner, with a direct investment of $10
billion (accounting for 9 percent of total foreign investment). Americans have made notable
foreign investments in the Asian country's power generation, telecommunications, ports, roads,
petroleum exploration and processing, and mining industries.[249]
American imports from India amounted to $46.6 billion or 2% of its overall imports, and 15.3% of
India's overall exports in 2015. Major commodities exported from India to the US include [250]
[251]
Gems, precious metals and coins, Pharmaceuticals, Oil, Machinery, Textiles (including knit &
crochet), Organic chemicals, Vehicles, and Iron or steel products
US Food and Drug Administration and Indian Export Inspection Council officials
review memorandum of understanding on food safety in 2015
American exports to India amounted to $20.5 billion or 5.2% of India's overall imports in 2015.
Major commodities exported from the US to India include:[252][253] Gems, precious metals and
coins, Machinery, Electronic equipment, Medical equipment, Oil,
Aircraft/spacecraft, Plastics, Organic chemicals, fruits and nuts.
In July 2005, President Bush and Prime Minister Manmohan Singh created a new programme
called the Trade Policy Forum.[254] It is run by a representative from each nation. The United
States Trade Representative was Rob Portman, and the Indian Commerce Secretary then-
Minister of Commerce Kamal Nath. The goal of the programme is to increase bilateral trade and
investment flow. There are five main sub-divisions of the Trade Policy Forum, including The
Agricultural Trade group, which has three main objectives: agreeing on terms that will allow India
to export mangoes to the United States, permitting India's Agricultural and Process Food
Products Export Development Authority (APEDA) to certify Indian products to the standards of
the U.S. Department of Agriculture, and executing regulation procedures for approving edible
wax on fruit.
The goals of the Tariff and Non-Tariff Barriers group include agreeing that insecticides
manufactured by US companies can be sold throughout India. India had also agreed to cut
special regulations on trading carbonated drinks, many medicinal drugs, and lowering regulations
on many imports that are not of an agricultural nature. Both nations have agreed to discuss
improved facets of Indian regulation in the trade of jewellery, computer
parts, motorcycles, fertiliser, and those tariffs that affect American exporting of boric acid. The
group has also discussed matters such as those wishing to break into the accounting
market, Indian companies gaining licenses for the telecommunications industry, and setting
policies regarding Indian media and broadcasting markets. Other foci include the exchange of
valuable information on recognizing different professional services, discussing the movement
and positioning of people in developing industries, continuation of talks on financial services
markets, limitation of equities, insurance, retail, joint investment in agricultural processing and
transportation industries, and small business initiatives.
On August 3, 2018, India became the third Asian nation to be granted Strategic Trade
Authorization-1 (STA-1) status by the United States. STA-1 enables the export of high-
technology products in civil space and defence from the US to India.[255][256]
On February 15, 2023, Air India announced an order of 470 jets, out of which 220 jets would be
bought from Boeing and the other 250 from Airbus. This is one of the biggest aircraft orders in
the commercial jet industry. The deal was acknowledged by both the POTUS and the PMO of
India.
During Modi's visit in 2023, resolution of six of seven outstanding WTO disputes between the US
and India through mutually agreed solutions, market access.
The nature of the Indo-US relationship has evolved significantly in recent years, with a
notable growth in convergence between the two countries. This convergence can be attributed
to various factors, such as geopolitical considerations, economic opportunities, and shared
democratic values. However, while there are positive developments, it is important to
critically evaluate this changing relationship.
Firstly, one of the key drivers of convergence in the Indo-US relationship is geopolitical
considerations. Both India and the US share concerns about the rise of China and its
increasing assertiveness in the Indo-Pacific region. This has led to closer cooperation
between the two countries in areas such as defense and security. The US has recognized India
as a major defense partner and the two countries have conducted joint military exercises and
signed defense agreements. This convergence in their strategic interests contributes to a
stronger relationship.
Secondly, there is an increasing economic dimension to the Indo-US relationship. India has
emerged as a significant economic partner for the US, with growing trade and investment
ties. The US is one of India's largest trading partners and foreign direct investors. This
economic convergence has the potential to strengthen the relationship, as both countries seek
to enhance bilateral trade and investment flows. Additionally, the US has supported India's
bid to join global economic forums such as the Nuclear Suppliers Group and has advocated
for a greater role for India in international institutions.
Furthermore, there is a convergence of democratic values between India and the US. Both
countries have robust democratic systems and a commitment to safeguarding individual
freedoms, human rights, and the rule of law. This shared commitment to democratic
principles has resulted in cooperation in areas such as education, science, and technology.
There have also been exchanges between the two countries to strengthen democratic
institutions and promote good governance.
However, it is important to critically evaluate the changing nature of the Indo-US relationship
and its growing convergence. Despite the positive developments, there are some challenges
and areas of divergence that need to be addressed. For instance, there have been trade
disputes between the two countries, particularly in sectors such as agriculture and intellectual
property rights. These disagreements highlight the need for greater economic cooperation and
a resolution of trade-related issues.
Moreover, there are concerns about the US's approach towards immigration and visa policies,
which have directly impacted Indian professionals and students. This has created some
tensions and could hinder the full potential of the relationship. Additionally, India's reliance
on Russian defense equipment and its relationship with Iran pose challenges to the Indo-US
strategic convergence.
In conclusion, the changing nature of the Indo-US relationship has seen a growing
convergence driven by geopolitical, economic, and democratic considerations. The shared
concerns about China, economic opportunities, and democratic values have brought the two
countries closer. However, it is vital to critically evaluate this relationship and address areas
of divergence to ensure a truly robust and sustainable partnership.
Firstly, cross border terrorism poses a significant threat to national security. Terrorist groups
leverage the porous borders between India and its neighbors to infiltrate the country and carry
out their destructive acts. These activities not only endanger the lives of Indian citizens but
also undermine the stability and peace within the country.
Secondly, cross border terrorism negatively impacts India's economic development. Frequent
terrorist attacks create an atmosphere of fear and uncertainty, discouraging foreign
investments and hindering various sectors of the economy. Investors are hesitant to invest in
regions prone to terrorism, hindering infrastructural development and economic growth.
Moreover, cross border terrorism strains diplomatic relations with neighboring countries,
mainly Pakistan. Continuous involvement of Pakistani-based terror outfits, such as Lashkar-
e-Taiba and Jaish-e-Mohammed, creates a trust deficit between the two nations and hampers
any peace-building initiatives. This volatile relationship further complicates efforts to resolve
other bilateral issues, such as territorial disputes and trade agreements.
Furthermore, cross border terrorism has a negative impact on regional stability and peace.
The activities of terrorist groups spread a sense of insecurity among neighboring countries,
leading to a cycle of violence and retaliation. Such instability not only affects India but also
impacts the overall peace and development in the South Asian region.
To address this challenge, India has adopted a multi-pronged approach. Firstly, it seeks to
enhance border security measures, including the fortification of border fences, improving
intelligence sharing, and enhancing surveillance technology. Secondly, India actively engages
in diplomatic efforts to isolate nations supporting cross border terrorism and raise the issue at
international forums. Thirdly, India continues to engage in dialogue with Pakistan to address
the issue of terrorism and find a peaceful resolution.
In conclusion, cross border terrorism poses not only an irritant but also a significant challenge
to India. It jeopardizes national security, hampers economic development, strains diplomatic
relations, and disrupts regional stability. India's approach to addressing this challenge
involves strengthening border security, diplomatically isolating supporters of terrorism, and
engaging in dialogue with Pakistan.
Cross-border terrorism indeed represents a major irritant and challenge to the relationship between
India and Pakistan. The phrase refers to terrorist activities carried out in one country by individuals or
groups operating from the other country, specifically in the context of India and Pakistan.
Firstly, cross-border terrorism has repeatedly strained diplomatic ties between the two countries.
Terrorist attacks originating from Pakistan, such as the 2008 Mumbai attacks and the 2019 Pulwama
attack, have resulted in heightened tensions and suspended dialogue between India and Pakistan.
The inability of Pakistan to take stringent action against terrorist groups operating from its soil has
led to a trust deficit and a breakdown in communication channels.
Secondly, cross-border terrorism has hindered efforts to resolve the Kashmir issue. Kashmir remains
a contentious region claimed by both India and Pakistan, with frequent incidents of violence and
unrest. The infiltration of terrorists from across the border exacerbates the situation, leading to
human rights violations and loss of lives. The presence of terrorist groups in the region further
complicates the peace process, making it difficult to find a mutually acceptable solution.
Moreover, cross-border terrorism affects the overall stability of the South Asian region. The constant
threat of terrorist attacks strains relations between neighboring countries and undermines regional
cooperation initiatives. Acts of terrorism spill over borders, causing a ripple effect and increasing the
likelihood of conflict escalation. This regional instability impedes collective efforts to address other
pressing issues such as poverty, development, and climate change.
Furthermore, cross-border terrorism hampers economic development in both India and Pakistan.
Frequent terrorist attacks, particularly on civilian targets, create an atmosphere of fear and disrupt
normal life. This deters potential investors, impedes trade and tourism, and negatively impacts
various economic sectors. The resulting economic slowdown further exacerbates socio-political
tensions between the two nations.
To address this challenge, it is crucial for both India and Pakistan to adopt a cooperative and
comprehensive approach. Firstly, there is a need for enhanced intelligence sharing and cooperation
to prevent the infiltration of terrorists. This can be achieved through strengthening border security
mechanisms, improving surveillance technology, and establishing effective communication channels
between security forces of both countries.
Additionally, both nations should engage in sustained and sincere dialogue to address the root
causes of cross-border terrorism. This includes addressing grievances related to Kashmir, curbing the
activities of terrorist groups, and taking strict action against those offering support and shelter to
terrorists. Confidence-building measures, such as people-to-people exchanges and cultural
engagements, can also play a significant role in fostering trust and understanding between the two
nations.
In conclusion, cross-border terrorism remains a major irritant and challenge to the Indo-Pak
relationship. It strains diplomatic ties, hinders conflict resolution efforts, destabilizes the region, and
hampers economic development. Addressing this challenge requires enhanced security cooperation,
sustained dialogue, and the collective will to root out terrorism. Only through such efforts can peace
and stability be achieved, enabling both nations to focus on their respective progress and
development.