As Joe Biden inches his way to victory and Donald Trump struggles to bear the ignominy of being the first one-term President of the United States (US) in the last two-and-a half-decades, it is time we took stock of what it means for India.
Looking back, it appears our Prime Minister miscalculated by a long shot. Narendra Modi’s visit to the US last July was crowned by the ‘Howdy Modi’ event in Houston. Members of the Indian community laid out a thick red carpet for both Trump and Modi. The extraordinary bonhomie provided the backdrop of what was seen as a tacit endorsement of Trump’s bid for Presidentship.
That was strange considering that the small 6 per cent or so Indian US community overwhelmingly votes Democrat, and Trump’s policies towards émigrés have been particularly cruel. Notwithstanding criticism, our Prime Minister followed up with the ‘Namaste Trump’ event in India on February 24 and 25 this year, where the US President and his family were treated to an ego massage by lakhs of cheering people crowded into a sports stadium in Ahmedabad.
Donald Trump looked truly overwhelmed. But the grand feting of the US President clearly went beyond normal diplomatic protocol into the domain of partisan support for Trump and his policies. To add to Mr Modi’s embarrassment, Trump in his final election debate recently att a c k e d C h i n a , R u s s i a and India for their “Filthy Air”. It left many gasping, and had ‘Howdy Modi’ trending on twitter!
Restoring fair trade
Compared to Trump, Joe Biden is a sober politician who knows India better. (Trump, it is believed, shocked Prime Minister Modi once, when he didn’t seem to know that China shared a common border with India.) Biden points to his role as the Chairman of the US Senate foreign relations committee, when in 2008, he navigated the historic India-US nuclear deal and rolled back sanctions that had been imposed after the Pokhran blast. Long-term, Trump did not deviate from his predecessors on the basic India perspective, and Joe Biden too is likely to keep to the script that sees India as a counterweight to China and a strong outpost to combat Islamic and other forms of terrorism.
On trade, Donald Trump has always been a hawk. He threatened sanctions if India did not lower tariff barriers against US imports, while he himself erected barriers in the US that have seriously dented our exports. When in October 2018, India bought 5 units of the SA-400 missile defense system from the Russians, Trump threatened trade sanctions which are still on the table. The same kind of bullying was visible when New Delhi continued to buy cheaper Iranian oil despite US’ unilateral trade embargo imposed on Iran.
The trade war intensified last year when in June 2019 India imposed tariffs against 28 US products in retaliation to the US’ impost of 70 per cent on Indian steel and aluminum imports. With Biden, trade practices are likely to return to more equitable levels. UBS Global Research too has predicted more favourable trade policies with India in case of a Biden win.
Easier immigration
Extremely damaging to Indians has been Trump’s general anti-immigration policies. These include a ban on issue of fresh H-1B visas which restrict tech companies from stationing their staff for reasonable periods in the US. Recent months have also seen the ban on visas for foreign workers in general as well as restrictive practices against foreign students, many of whom had to return home when their visas were not renewed.
In contrast, Joe Biden has promised a liberal immigration policy that looks at immigrants as a positive resource for the US. He has therefore promised to do away with Trump era restriction on immigration, and to stop the construction of the Mexican wall. He has also promised a “road map to citizenship” for people living in the US illegally. These will benefit a large chunk of our young job seekers or those seeking to join their families in the US.
What has been significant is the steady erosion of India’s economic power in recent years and a growing perception that we have a tough regulatory system for investors. The international arbitration award in favour of Vodafone in September ruling India was in breach of the “guarantee of fair and equitable treatment” is a case in point. In reviewing ties with the new US administration, our weaker bargaining power will be a matter of concern. In many ways, Trump and Modi spoke the same language in areas such as law enforcement and building alliances against ‘terror’ groups. Joe Biden and a liberal Democratic regime will flag local thorny issues such as Kashmir and minority rights. The left wing of his party represented by figures such as Alexandra Ocasio Cortez are active and will demand to be heard. This is bound to be a cause of concern for the Modi administration.