Brief for Congress
India-U.S. Relations
Amit Gupta
Foreign Affairs, Defense, and Trade Division
Congressional Research Service
The Library of Congress
Updated September 3, 2002
CONTENTS
India - U.S. Relations
Although the end of the Cold War freed U.S.-India relations from the constraints of a bipolar world,bilateral relations continued for a decade to be affected by the burden of history, most notably thelongstanding India-Pakistan regional rivalry. Recent years, however, have brought a sea change in U.S.- Indiarelations, which was reflected in India’s swift offer of full support for the U.S.-led war on terrorismfollowing the September 11, 2001, terrorist attack on New York and Washington.
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The continuing U.S. concern in South Asia, however, is the reduction of tensions between India andPakistan, which center on their competing claims to the former princely state of Kashmir, and the preventionof nuclear and ballistic missile proliferation. India and Pakistan have so far ignored U.S. and internationalpressure to sign the Nuclear Nonproliferation Treaty or the Comprehensive Test Ban Treaty (CTBT).
On May 11 and 13, 1998, India conducted a total of five unannounced nuclear tests, setting off worldwidecondemnation. Following India’s lead, on May 28 and 30, Pakistan reported conducting six nuclear tests. As aresult of the tests, President Clinton imposed wide-ranging sanctions on both countries, mandated by the ArmsExport Control Act. Many of these sanctions gradually were lifted through Congress-Executive branchcooperation in 1998-2000. The remaining nuclear sanctions on India and Pakistan were removed on September 22,2001.
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Congress also has been concerned with human rights issues related to regional dissidence and separatistmovements in Kashmir, Punjab, and India’s Northeast region. Strife in these areas over the past decade hasresulted in the deaths of thousands of civilians, militants, and security forces. International human rightsgroups, as well as Congress and the U.S. State Department, have criticized India for alleged human rightsabuses by its security forces in efforts to suppress these movements.
The United States has been highly supportive of India’s efforts to transform its formerly quasi-socialisteconomy through fiscal reform and market opening, beginning under the Narasimha Rao government in 1991, whenIndia took steps to reduce inflation and the budget deficit, privatize state-owned industries, reduce tariffsand industrial licensing controls, and institute incentives to attract foreign trade and investment.Successive coalition governments kept India generally on the path of economic reform and market opening.Rapidly expanding U.S.-India economic relations were a major focus of President Clinton’s March 2000 fivedayvisit to India.
The Bharatiya Janata Party (BJP) coalition government led by Prime Minister Atal Behari Vajpayee, whichcame to power following the March 1998 parliamentary elections, supported a modest pace of economic reform. InApril 1999, the BJP government resigned following the loss of a confidence vote, 270-269. In October 1999, theBJP government regained power following national elections. A BJP-led multiparty alliance won about 300 of 545parliamentary seats, prompting analysts to forecast a period of more stable government. In November 2001,Vajpayee met with President Bush in Washington to discuss the outlines of expanding U.S.-India cooperation.
In August, militant violence continued in Indian Kashmir with militant groups now threatening toliquidate anyone who directly participates in the September-October elections to the Jammu and Kashmir stateassembly. The Indian government is continuing its efforts to get all shades of political opinion toparticipate in the forthcoming elections. India remains concerned about militants crossing the border andcommitting acts of violence to intimidate Kashmiri voters and politicians.
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The United States has declared that it views free and fair elections in the state as the first part of aprocess to bring about a peaceful settlement of the India-Pakistan dispute. Deputy Secretary of State RichardArmitage paid another visit to South Asia on August 23- 24, 2002. He said that while there was obviousinfiltration across the border, “No one , here in Pakistan or in India, thinks that the Pakistan governmentis solely responsible for the infiltration.”
The military standoff between India and Pakistan continued with an exchange of fire continuing along theborder. In early August it was reported that India had sought to dislodge a Pakistani incursion across theLine of Control in Kashmir. Later, during Deputy Secretary Armitage’s visit, Pakistan claimed that India hadused ground forces and air support to attempt to dislodge Pakistani troops from one of their positions. Indiadenied that the incident had taken place.
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India announced that it was going to induct two missiles into service: the Brahamos PJ- 10 anti-shippingsupersonic cruise missile and the Agni 1 medium range missile.
In the immediate wake of the September 11, 2001 terrorist attacks on New York and Washington, India tookthe unprecedented step of offering to the United States all cooperation and the use of India’s bases for thewar on terrorism. The offer reflected the sea change that has occurred in recent years in the U.S.-Indiarelationship, which for decades was mired in the politics of the Cold War. The marked improvement of relationswith New Delhi that began in the latter days of the Clinton Administration was accelerated by a majorcommitment of the Bush Administration to strengthen U.S.-India security cooperation, with a strong focus oncounter-terrorism. In June 2001, the U.S.-India Counter-terrorism Working Group held its third meeting, whichfocused, in part, on Taliban-fostered terrorism. At the fourth meeting of the Joint Working Group held inJanuary 2002, joint counter-terrorism cooperation was expanded and a new Joint Initiative on Cyberterrorismwas launched. On November 9, 2001, President Bush hosted Prime Minister Vajpayee at a White House workingsession, during which the two leaders agreed to greatly expand U.S.-India cooperation on a wide range ofissues, including counter-terrorism; regional security; space and scientific collaboration; civilian nuclearsafety; and broadened economic ties. In early December 2001, the U.S. Defense Policy Group met in New Delhifor the first time since India’s 1998 nuclear tests and outlined a defense partnership that includes highlevel policy dialogue, joint exercises, and military sales.
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U.S. and congressional interests in India cover a wide spectrum of issues, ranging from the face off withPakistan in Kashmir and nuclear and missile proliferation to concerns related to human rights and trade andinvestment opportunities. In the 1990s, U.S.-India relations were particularly affected by three developments:1) the demise of the Soviet Union – India’s key trading partner and most reliable source of economicassistance and military equipment – and New Delhi’s resulting need to diversify its internationalrelationships; 2) India’s adoption of sweeping economic policy reforms, beginning in 1991; and 3) adeepening bitterness between India and Pakistan over Kashmir, along with India’s preoccupation with China asa long-term strategic threat.
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With the fading of Cold War constraints, the United States and India began exploring the possibilities of amore normal relationship between the world’s two largest democracies. The 6-day visit to the United Statesby Indian Prime Minister Narasimha Rao, in May 1994, marked the beginning of a significant improvement inU.S.-India relations. Rao addressed a joint session of the Congress and met with President Clinton. Althoughdiscussions were held on nuclear nonproliferation, human rights, and other issues, the main focus of the visitwas rapidly expanding U.S.-India economic relations. Throughout the 1990s, however, regional rivalries,separatist tendencies, and sectarian tensions continued to divert India’s attention and resources fromeconomic and social development. Fallout from these unresolved problems – particularly nuclear proliferationand human rights issues – presented serious irritants in U.S.-India relations.
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President Clinton’s March 19-26, 2000 visit to South Asia represented a major U.S. initiative to improvecooperation across a broad spectrum, including: economic ties; regional stability; nuclear proliferationconcerns; security and counter-terrorism; environmental protection; clean energy production; and diseasecontrol. Clinton and Indian Prime Minister Atal Behari Vajpayee agreed in a vision statement toinstitutionalize dialogue between the two countries through a range of high-level meetings and working groupson the various areas of cooperation, capped by regular bilateral “summits” between the leaders of the twocountries. Economic ties were a major focus of Clinton’s visit, during which U.S. companies signedagreements on $4 billion in projects with Indian and Bangladeshi firms. Clinton also announced $2 billion ingovernment financial support for U.S. exports to India through the U.S. Export-Import Bank. To further expandbilateral economic cooperation, the United States and India agreed to establish working groups on trade; cleanenergy and environment; and science and technology. U.S.-India agreements also were signed on environmentalprotection, clean energy production, and combating global warming. The President also lifted sanctions on somesmall U.S. assistance programs, including a U.S. Agency for International Development initiative to providetechnical assistance to strengthen Indian financial markets and regulatory agencies. On the social welfareside, U.S.-India cooperation agreements were signed on efforts to combat polio, tuberculosis, malaria, andHIV/AIDS, as well as the trafficking of women and children in South Asia.
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During his 10-day visit to the United States in September 2000, Indian Prime Minister Vajpayee addressed ajoint session of the U.S. Congress and was the guest of honor at a state dinner at the White House. During thecourse of the prime minister’s visit to Washington, U.S. officials announced $900 million in Export-ImportBank financing to help Indian businesses purchase U.S. goods and services. U.S. companies also signedagreements to construct three large power projects in India, valued at $6 billion, as part of increased energycooperation between the two countries. On September 15, President Clinton and Prime Minister Vajpayee signed ajoint statement agreeing to cooperate on arms control, terrorism, and AIDS. When Vajpayee revisited the UnitedStates in early November 2001, he came at a time of heightened tensions in South Asia but also during a timeof warming Indo-U.S. relations in spite of the close U.S.-Pakistani cooperation during the war in Afghanistan.Vajpayee used the occasion to express his concerns that if the U.S. military effort in Afghanistan wereperceived as “slackening” then extremist forces in Pakistan could be bolstered.
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Three wars – in1947-48, 1965, and 1971 – and a constant state of military preparedness on both sides ofthe border have marked the half-century of bitter rivalry between India and Pakistan. The acrimonious natureof the partition of British India in 1947 and the continuing dispute over Kashmir have been major sources oftension. Both India and Pakistan have built large building defense establishments – including nuclearweapons capability and ballistic missile programs – at the cost of economic and social development. TheKashmir problem is rooted in claims by both countries to the former princely state, divided by a military lineof control (LOC), since 1948, into the Indian state of Jammu and Kashmir and Pakistan-controlled Azad (Free)Kashmir. India blames Pakistan for supporting a separatist rebellion in the Muslim-dominated Kashmir Valleythat has claimed 30,000 lives since 1990. Pakistan admits only to lending moral and political support. (Seealso pp. 8-9)
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Adding to India’s bitterness toward Pakistan is the latter’s historically close ties with China. Indiaand China fought a short border war in 1962, and China since then has occupied territory claimed by India.Although Sino-Indian relations have improved markedly in recent years, the two countries have yet to reach aboundary agreement. Moreover, India remains suspicious of China’s nuclear weapons capability as well as itslong-time support for Pakistan. During a visit by former Prime Minister Rao to China in September 1993,however, an agreement was signed to reduce troops and maintain peace along the line of actual control (LAC)that divides their forces, along with agreements on trade, environmental, and cultural cooperation. InDecember 1995, after eight rounds of talks by an India-China joint working group (JWG), both sides pulled backtroops from four points along the eastern sector of the border. A visit by Chinese President Jiang Zemin toIndia in late November 1996 concluded with an agreement by India and China not to attack each other acrosstheir disputed border and to negotiate a partial withdrawal of troops from the border. Although border tradehas continued to expand, political relations suffered a setback as a result of statements by Indian governmentofficials that its May 1998 nuclear tests were prompted in large part by the China threat. In May 2000,however, Indian President K.R. Narayanan made a 7-day state visit to China and signed an agreement with China’sPresident Jiang Zemin to further bilateral ties, including trade, currently totaling $2 billion. China’sparliamentary leader, Li Peng, reciprocated with a 9-day visit to India in January 2001. In January 2002,Chinese Premier Zhu Rongji became the first Chinese premier to visit India in 11 years. Zhu advocated expandedrelations with India as well as increased cooperation in combating international terrorism.
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In the September-October 1999 parliamentary elections, India’s voters elected a Bharatiya Janata Party (BJP)coalition government, led by Prime Minister Atal Bihari Vajpayee, with a majority of about 300 of 545parliamentary seats. (See CRS Report RS20320, India’s 1999 Parliamentary Elections.) This is Vajpayee’sthird time as prime minister – his previous governments lasting 13 days in 1996 and 13 months in1998-99.
As a nation, India presents a vast mosaic of hundreds of different ethnic groups, languages, religioussects, and social castes. Until the last decade or so, many of these groups found representation within thediversity of the Congress Party, which ruled India for 45 of its 53 years since independence in 1947. Factorsin the decline of support for the Congress included neglect of its grassroots political organizations by theleadership; a perceived lack of responsiveness to such major constituent groups as Muslims and lower castes;the rise of regional parties and issue-based parties such as the BJP; allegations of widespread corruptioninvolving a number of party leaders; and the lack of charisma provided by former Congress leaders, mostlymembers of the Nehru-Gandhi family. At the same time, there has been a shift in power from upper caste Indiansto the far more numerous lower caste Indians, who have switched their allegiance from Congress and the smallernational parties to regional and caste-based parties.
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The Indian political system is viewed by some analysts as being in a transition period from its years ofdominance by the Congress Party to a two-party system, perhaps centered on the BJP and the Congress. Manyobservers believe, however, that coalition politics will be the order of the day for some time to come. In the1999 election, there was little apparent progress toward a two-party system, with the Congress losing groundand the BJP gaining only about five seats over its previous total. The BJP alone won only about 183 seats toabout 113 for the Congress – both far short of the 273 needed for a majority in the 545-seatParliament.
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Riding a crest of rising Hindu nationalism, the BJP increased its strength in Parliament from two seats in1984 to 119 seats in 1991. In 1992-93, the party’s image was tarnished by its alleged complicity in seriousoutbreaks of communal violence in which a mosque was destroyed at Ayodha and 2,500 people were killed in anti-Muslim rioting in Bombay and elsewhere. Some observers view the BJP as the political arm of the extremistHindu nationalist organization Rashtriya Swayamsevak Sangh (National Volunteer Force), allegedly responsiblefor the incidents. Since then, the BJP has worked – with some success – to change its image fromright-wing Hindu fundamentalist to conservative, secular, and moderate – although the February 2002 riots inGujarat hurt the party’s national and international credentials as a secular and moderate organization. Inthe 1996 elections, the BJP won 160 seats. With the support of allied parties it controlled 190 seats and wasgiven the opportunity to form a government with party leader Vajpayee as prime minister. Because of its Hindunationalist platform, the BJP was unable to attract sufficient coalition partners and resigned after 13days.
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Following the February-March 1998 elections, the BJP managed to cobble together a shaky, 13-member NationalDemocratic Alliance coalition, headed by Vajpayee, and pass a confidence vote. Factors that kept the BJPgovernment in power for a year included: Vajpayee’s widespread personal popularity, early popular euphoriaover India’s April 1998 nuclear tests, and the feeling that, after lackluster performances by Congress andUnited Front governments, the BJP should be given its chance to lead the country. Vajpayee soon found himselfcaught in a continuing round of internal bickering and favor-seeking by coalition members. Such distractionsdelayed efforts at focusing on more urgent matters, including the economy. The April 1999 no-confidence votewas precipitated by the withdrawal of support for the BJP government by its largest coalition partner, aregional party based in the southern state of Tamil Nadu.
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The BJP advocates “Hindutva,” or an India based on Hindu culture. Although the BJP claims to accept allforms of belief and worship, it views Hindutva as key to nation-building. Much of its support comes fromprofessionals and upper caste groups. It continues to be looked on with suspicion by lower caste Indians,India’s 120 million Muslims, and non- Hindi-speaking Hindus in southern India, who together comprise amajority of India’s voters. The more controversial long-term goals of the BJP reportedly include: building aHindu temple on the site of a 16th century mosque in Ayodhya that was destroyed by Hindu mobs in 1992;establishing a uniform code of law that would abolish separate Muslim laws on marriage, divorce, and propertyrights; and abolishing the special status promised Jammu and Kashmir state under Article 370 of the IndianConstitution. None of the issues are mentioned in the NDA 1999 election manifesto and would be opposed by mostNDA coalition members. The BJP leadership would have liked to have put these goals on the back burner for thetime being but current tensions – the continuing military face-off between India and Pakistan as well as aflare up of Muslim-Hindu communal passions in the western state of Gujarat – have put the party in anawkward position.
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On February 24, 2002, just days before a major flare up between Muslims and Hindus in the western state ofGujarat, the BJP was rejected by a majority of voters in the critical state elections of Uttar Pradesh. Thisdefeat, as well as setbacks in Punjab and Uttaranchal, showed voters to be less interested in the BJP’s “toughon Pakistan” platform and more interested in bread and butter issues. Two days after the state elections,religious fervor rose to a fever pitch after Muslims attacked a train carrying members of the Vishwa HinduParishad (VHP–World Hindu Council), a Hindu activist group that had participated in a vigil supporting theconstruction of a Hindu temple over the ruins of a mosque in Ayodhya, Uttar Pradesh. Fifty-eight Hindus werekilled in the train attack and more than 800, mostly Muslims, were killed by Hindus in retaliatory mobactions.
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The post-election weakness of the opposition is a major factor in the BJP coalition government hopes forcompleting its 5-year term. With just 113 seats (about 135 counting allies) the Congress Party is at itslowest representation ever. Observers attribute the party’s poor showing to a number of factors including:the perception that Sonia Gandhi lacked the experience to lead the country; the failure of Congress to makestrong preelection alliances, as had the BJP; and the splintering of Congress in Maharashtra state. In May1999, when Sharad Pawar and two other Maharashtra Congress leaders raised the issue of Sonia Gandhi’sforeign (Italian) origins making her unsuitable for the prime ministership, they were expelled from the partyby Gandhi supporters. Pawar and his breakaway faction formed the Nationalist Congress Party (NCP). Seat totalsfor the other opposition parties IB93097 09-03-02 CRS-6 (including leftists and regional parties) alsodeclined from about 143 in the previous parliament to about 107.
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Congress Party Background.
Support for the Congress Party declined following the 1984 assassination of Prime Minister Indira Gandhi(daughter of India’s first prime minister, Jawaharlal Nehru) and the 1991 assassination of her son, formerPrime Minister Rajiv Gandhi. Sonia Gandhi, Rajiv’s widow, refused to be drawn into active politics untilthe1998 elections. With the party’s fortunes sagging, Sonia plunged into a flurry of crosscountrycampaigning, accompanied by her daughter Priyanka and son Rahul (both in their twenties). Although the “Soniafactor” wasn’t enough for a Congress win, it was viewed as preventing a debacle for the party. As aresult, Gandhi was elected both president of the Congress Party and chairperson of the Congress ParliamentaryParty. Sonia began belated efforts to revitalize the moribund party by phasing out older leaders andattracting more women and lower castes. In November 1998, signs of a resurgent Congress Party were apparent ina series of state elections. By landslide margins, the Congress defeated BJP governments in Rajasthan andDelhi and maintained its control of Madhya Pradesh. However, inability of the Congress to form a newgovernment after the fall of the BJP coalition in April, plus defections led by Sharad Pawar, weakened theparty in the 1999 parliamentary elections.
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The Kashmir problem is rooted in claims by both India and Pakistan to the former princely state, divided bya military line of control since 1948, into the Indian state of Jammu and Kashmir and Pakistan controlled Azad(free) Kashmir. Since late 1989, a separatist war, costing more than 30,000 lives, has been waged in theIndian-controlled Kashmir Valley between Muslim separatists and their supporters and Indian security forces.India blames Pakistan for fomenting rebellion, as well as supplying arms, training, and fighters. Pakistanclaims only to provide diplomatic and moral support. The longstanding U.S. position on Kashmir is that thewhole of the former princely state is disputed territory, and the issue must be resolved through negotiationsbetween India and Pakistan, taking into account the wishes of the Kashmiri people.
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A series of kidnappings and general strikes in the Kashmir Valley, beginning in 1989, led India to imposePresident’s rule (rule by the central government) on the state in 1990, and to send in troops to keep order.Following a number of incidents in which Indian troops fired on demonstrators, Kashmiris flocked to support aproliferating number of militant separatist groups. Some groups, such as the Jammu and Kashmir LiberationFront (JKLF), continue to seek an independent or autonomous Kashmir. Other local groups, including the HizbulMujahideen (HM), seek union with Pakistan. In 1993, the All Parties Hurriyat (Freedom) Conference was formedas an umbrella organization for groups opposed to Indian rule in Kashmir. Hurriyat membership includes about22 political and religious groups, including: JKLF (now a political group); Jamaat-e-Islami (political wing ofthe HM); Awami Action Committee; People’s Conference; Muslim Conference; and People’s League. The HurriyatConference, which states that it is committed to seeking dialogue with the Indian government on a broad rangeof issues, proposes convening a tripartite conference on Kashmir, including India, Pakistan, andrepresentatives of the Kashmiri people. Hurriyat leaders also have demanded Kashmiri representation at anytalks between India and Pakistan on Kashmir.
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In 1995, the government of then-Prime Minister Narasimha Rao began efforts to restart the political processin Kashmir, where state elections had last been held in 1987. In May 1996, elections to fill the six seats forJammu and Kashmir State were held as part of the general parliamentary elections called by the Rao government.Voter turnout in the state was about 40%, with some reports of voters being herded to polling stations bysecurity forces. The elections served as a rehearsal for Jammu and Kashmir state assembly elections, whichwere held in September 1996. The National Conference (NC), the longstanding mainstream Kashmiri party led byFarooq Abdullah, won 57 of 87 seats, and Abdullah became chief minister of the state. In March-April 1998,Jammu and Kashmir State again took part in general parliamentary elections. Pre-election violence and aboycott by the Hurriyat kept voter turnout in the state at an estimated 35%-40%. Voter turnout in the statedeclined even further in the 1999 parliamentary elections.
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Recently, violent incidents in both India and Pakistan worsened the security climate in the region andpushed both countries to the brink of war. On May 14, 2002, in the town of Kaluchak in Jammu, there was anattack on an Indian army base that left 34 people dead, most of them civilians. The Indian government saw thisas another instance of Pakistansponsored terrorism and stepped up the rhetoric in the current militarystandoff. Indian Prime Minister Atal Behari Vajpayee then told Indian troops to prepare for a decisive waragainst Pakistan. Indian Navy vessels were moved towards Karachi and heavy shelling broke out on theIndia-Pakistan border. The situation was further vitiated when moderate Kashmiri separatist leader Abdul GhaniLone was assassinated while addressing a meeting. Lone’s son first blamed Pakistan for the killing but thenbacktracked from the accusation. Lone had been one of the voices calling for a nonviolent solution to theKashmir problem. The Kaluchak attack and the Lone assassination further fueled tensions in the region, andIndian Prime Minister Vajpayee declared that India might have to wage a “decisive war” against Pakistan tostop cross-border terrorism. There were reports that India was planning a limited strike against sixty toseventy terrorist bases in Azad (Pakistani) Kashmir.
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As tensions grew, Pakistan decided to test a series of ballistic missiles. On May 25, the country testedthe Ghauri medium-range missile (a North Korean No Dong missile with a range of 900 miles). On May 26, ittested a 170 kilometer range Ghaznavi missile (a shortrange missile of Chinese origin). Both missiles arereported to be nuclear capable. The official Indian reaction was that the government was not impressed, andthat President Musharraf was carrying out the tests to impress his domestic audience. There were also reportsthat Pakistani nuclear scientists were working three shifts to provide the country with more deliverablenuclear weapons.
Growing international pressure led General Musharraf to make a speech to the Pakistani nation on May 27 inwhich he said that no infiltration was taking place at the Line of Control. On receiving assurances fromSecretary of State Powell and Deputy Secretary of Defense Armitage that Pakistan would terminate support forinfiltration and dismantle militant training camps, India began the slow process of reducing tensions withPakistan. It recalled naval vessels that were patrolling near Pakistan’s coastal waters; it agreed inprinciple to allow Pakistan to use its air space, and it named an ambassador to Islamabad (although it has notyet sought to give his name to the Pakistan government). Indian officials were, however, unwilling to pullback large numbers of troops from the border until they received proof that cross border infiltration had,indeed, stopped (recent reports suggest that India may have pulled three divisions off the border). India’sDefense Minister, George Fernandes, said that troops would remain on the border until about October to verifythat infiltration had, in fact, stopped.
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The United States and Britain proposed that a multinational force patrol the Line of Control(LOC) inKashmir to monitor infiltration. India turned down the proposal and, instead, suggested that India andPakistan jointly patrol the border. The Indian argument was that both countries were familiar with the lay ofthe land and, therefore, their efforts would be more effective than those of a foreign force. India hasaccepted the U.S. proposal to deploy sensors and monitors on its side of the LOC to monitor infiltration.According to reports, an Indian technical team is to visit the Sandia National Laboratories to be trained inusing monitoring and surveillance technologies.
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India continued to upgrade its military capability. In July 2002 it announced that one more test of the 700kilometer missile Agni-1 would take place before it was inducted into service. India is also likely topurchase the Israeli Arrow missile defense system, a decision that has led some official U.S. groups toexpress concern about the adverse impact this purchase would have on the India-Pakistan militaryconfrontation. Others reportedly argued that it was a good move that might strengthen India-U.S. defensecooperation.
In Indian Kashmir, the political situation remained volatile. Elections to the state assembly have beenannounced and will take place in four rounds of voting–September 16 and 24 and October 1 and 8. The UnitedStates has endorsed the election process as the first part of a meaningful dialogue between India and Pakistanto peacefully resolve their long standing dispute. During his July visit to India, the Secretary stated, “Weare looking to both India and Pakistan to take steps that begin to bring peace to the region and to ensure abetter future for the Kashmiri people. The problems with Kashmir cannot be resolved through violence, but onlythrough a healthy political process and a vibrant dialogue.” He continued, “We welcome India’scommitment to hold free and fair elections, and we believe an inclusive election, meeting these standards canserve as a first step towards peace and reconciliation. We look forward to concrete steps by India to fosterKashmiri confidence in the election process. Permitting independent observers and freeing political prisonerswould be helpful.”
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He concluded by saying that,
We also look to all parties to do their part to ensure that the upcoming elections can be held in safetyand without interference from those who would like to spoil them, for those who do not wish to see peace andreconciliation. Kashmiri’s want to run or vote in the elections. And if they do so, they should be allowedto do so, without endangering their lives. Elections alone, however, cannot resolve the problems between Indiaand Pakistan, nor can they erase the scars of so many years of strife. Elections can however, be a first stepin a broader process that begins to address Kashmiri grievances, and leads India and Pakistan back todialogue.”
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(Secretary of State Colin L. Powell’s pressconference in New Delhi, July 28, 2002)
India has expressed concern over the call for “fostering Kashmiri confidence in the election process”since it believes that if terrorist violence is checked it can hold an election where both candidates andvoters are free of intimidation. The Indian government has also ruled out the need for international observersstating that both journalists and interested observers are free to go to Kashmir in an unofficial capacity andhave been doing so for some time now. (Arati R. Jerath, “Powell’s Poll Remark Tests India-Positive,” TheIndian Express, July 31, 2002.)
Holding a fair, open, and representative election will be difficult because several groups including the23-member Hurriyat have refused to participate in the process. Further, militants have been threateningpoliticians who are considering a run for office. Threats of violence have also been made to intimidate thevoting public. Cross border infiltration remains a major concern for India, although there is a recognitionthat Pakistan cannot prevent all such incursions. During Deputy Secretary of State Richard Armitage’s visitto South Asia, on August 23-24, 2002, he said that while there was obvious infiltration across the border, “Noone, here in Pakistan or in India, thinks that the Pakistan government is solely responsible for theinfiltration.”
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Militant violence continued in Indian Kashmir as did clashes along the border with Pakistani forces. DuringDeputy Secretary Armitage’s visit the Pakistani government claimed India had attacked a Pakistani forwardpost with both troops and aircraft. India denied the claim. There was also, reportedly, fighting between thetwo countries in July- August 2002 over mountain peaks in the Drass area of Kashmir.
On May 11 and 13, 1998, India conducted a total of five underground nuclear tests, breaking a 24-yearself-imposed moratorium on nuclear testing. Pakistan followed, claiming 5 tests on May 28, 1998, and anadditional test on May 30. The unannounced tests created a global storm of criticism, as well as a serioussetback for decades of U.S. nuclear nonproliferation efforts in South Asia. On May 13, 1998, President Clintonimposed economic and military sanctions on India, mandated by Section 102 of the Arms Export Control Act (AECA),and applied the same sanctions to Pakistan on May 30. Some effects of the sanctions on India included:termination of $21 million in FY1998 economic development assistance; postponement of $1.7 billion in lendingby the International Financial Institutions (IFI), as supported by the Group of Eight (G-8) leading industrialnations; prohibition on loans or credit from U.S. banks to the government of India; and termination of ForeignMilitary Sales under the Arms Export Control Act. Humanitarian assistance, food, or other agriculturalcommodities are excepted from sanctions under the law. (See CRS Report 98-570, India-Pakistan Nuclear Testsand U.S. Response and CRS Report RL30623, Nuclear Weapons and Ballistic Missile Proliferation in India andPakistan: Issues for Congress.)
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U.S. policy analysts consider the continuing arms race between India and Pakistan as posing perhaps themost likely prospect for the future use of nuclear weapons. India conducted its first, and only, previousnuclear test in May 1974, following which it maintained ambiguity about the status of its nuclear program.Pakistan probably gained a nuclear weapons capability sometime in the 1980s. India is believed to have enoughplutonium for 75 or more nuclear weapons. Pakistan may have enough enriched uranium for 25 nuclear weapons(although some reports suggest that Pakistan may have an arsenal that is larger than India’s). Bothcountries have aircraft and missiles capable of delivering weapons. India has short-range missiles (Prithvi)and is developing an intermediate-range ballistic missile (Agni) with enough payload to carry a nuclearwarhead. Pakistan has the Shaheen, Ghauri, and Ghaznavi missiles.
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In early 2002, India tested an 700 kilometer range version of the Agni missile to give it a credible secondstrike capability against Pakistan. Later, in April, the Indian Cabinet approved the establishment of aStrategic Nuclear Command (SNC) that would control the country’s nuclear arsenal. The SNC is to functionunder the Integrated Defense Staff. The final authority on decisions regarding nuclear weapons is to rest,however, with the Cabinet Committee on Security headed by the Prime Minister. In creating such an authority,India appears to have taken the next logical step in operationalizing its nuclear weapons capability. In 2000,Pakistan created a Nuclear Command Authority to oversee its nuclear arsenal.
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The Indian government has given the go-ahead for the establishment of an Agni-1 missile group in the Indianarmy. The missile group will be in addition to the existing short range Prithvi missile groups. The governmentis also expected to announce the creation of an Agni-2 Intermediate Range Missile group.
Proliferation in South Asia is part of a chain of rivalries – India seeking to achieve deterrence againstChina, and Pakistan seeking to gain an “equalizer” against a larger and conventionally stronger India.India began its nuclear program in the mid-1960s, after its 1962 defeat in a short border war with China andChina’s first nuclear test in 1964. Despite a 1993 Sino-Indian troop reduction agreement and some easing oftensions, both nations continue to deploy forces along their border. Pakistan’s nuclear program was promptedby India’s 1974 nuclear test and by Pakistan’s defeat by India in the 1971 war and consequent loss of EastPakistan, now independent Bangladesh.
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Neither India nor Pakistan are signatories of the Nuclear Nonproliferation Treaty (NPT) or theComprehensive Test Ban Treaty (CTBT). India has consistently rejected both treaties as discriminatory, callinginstead for a global nuclear disarmament regime. Pakistan traditionally has maintained that it will sign theNPT and CTBT only when India does so. Aside from security concerns, the governments of both countries arefaced with the prestige factor attached to their nuclear programs and the domestic unpopularity of giving themup.
Halt further nuclear testing and sign and ratify the CTBT.
U.S. and international pressure after the 1998 nuclear tests produced resolutions by the U.N. SecurityCouncil and the Group of Eight (G-8) urging India and Pakistan to sign the CTBT. Japan – the largestbilateral aid donor for both countries – made resumption of its aid programs contingent on signing the CTBTand assurances not to transfer nuclear technology or material to any other country. In October 2001, however,Japan suspended sanctions against both countries in recognition of their support for the U.S.-led war onterrorism. Although both India and Pakistan currently observe self-imposed moratoria on nuclear testing, theycontinue to resist signing the CTBT – a position made more tenable by U.S. failure to ratify the treaty in1999.
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In August 1999, India’s Bharatiya Janata Party (BJP) government released a draft report by the NationalSecurity Advisory Board (NSAB) on India’s nuclear doctrine. The report, although retaining India’sno-first-use policy, called for creation of a “credible nuclear deterrence and adequate retaliatorycapability should deterrence fail.” It proposed nuclear weapons “based on a triad of aircraft, mobileland-based missiles and sea-based assets....” The United States and other countries criticized the documentas destabilizing, noting that, if adopted, the proposed policy would ratchet up nuclear arms racing in theregion.
With both Pakistan and India making significant improvements in their forces–through the building ordeployment of a series of new missiles–and given the danger of conflict escalation in the region, the UnitedStates has focused on restraining the outbreak of a military conflict in the region. Nonproliferation has beena secondary objective as the more important objectives of preventing a conflict or the unauthorized use ofnuclear weapons (more a question with Pakistan than with India) and the war on terror have taken precedence.
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Through a series of legislative measures, Congress has lifted nuclear related sanctions on India andPakistan. In October 1999, Congress passed H.R. 2561, the Department of Defense Appropriations Act, 2000, andit was signed by the President as P.L. 106-79 on October 29. Title IX of the act gives the President authorityto waive sanctions applied against India and Pakistan in response to the nuclear tests. In a presidentialdetermination on India and Pakistan issued on October 27, 1999, the President waived economic sanctions onIndia. On September 22, 2001, President Bush issued a final determination removing remaining sanctions onPakistan and India resulting from their 1998 nuclear tests. Currently, the last effects of the nuclearsanctions are four Indian entities (and their subsidiaries) that remain on the Department of Commerce list ofentities for which export licenses are required. (For details, see CRS Report RS20995, India and Pakistan:Current U.S. Economic Sanctions, by Dianne E. Rennack.)
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Unlike U.S.-Pakistan military ties, which date back to the 1950s, military cooperation between the UnitedStates and India is in the early stages of development. Joint Indo-U.S. steering committees – established in1995 to coordinate relations between the two countries’ armed services, including exchange visits, technicalassistance, and military exercises – were put on hold following India’s 1998 nuclear tests. In 1997, theUnited States and India signed a bilateral treaty for the extradition of fugitive offenders, an important stepin joint efforts to combat the problems of international terrorism and narcotics trafficking. In January 2000,a U.S.-India Joint Working Group on Counter-Terrorism was established. India has been a leading country insupporting U.N. peacekeeping efforts with troops and observers. In late January 2002, India had more than2,800 U.N. peacekeeping forces, mainly serving in Sierra Leone, Lebanon, Kosovo, and Bosnia.
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In the aftermath of September 11 and despite the United States’s rapprochement with Pakistan, India-U.S.security cooperation has flourished. Both countries have recognized the need for greater security cooperationand a series of measures have been taken to implement this goal. Observers in both countries see the changedsituation in Asia as well as long-range concerns about China as driving the new relationship.
Joint Executive Steering Groups between the three services of the two countries also have been created andhave been meeting. The two countries are planning to hold joint military training exercises in Alaska in 2003.The navies of the United States and India are to cooperate in securing the maritime trade routes between theStraits of Hormuz and the Straits of Malacca. Between 2001 and 2002, funding for cooperation in militarytraining projects more than doubled (to $1 million) under the International Military Education and TrainingProgram. For FY2003, the Administration has requested $1 million for IMET and $50 million for Foreign MilitaryFinancing (for fighting terrorism). Additionally, the two countries have launched high-level discussions aboutthe global threat of cyberattacks and possible protective measures.
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In May 2002, American and Indian Special Forces conducted a joint exercise, Balance Iroquois, in the Indiancity of Agra. Balance Iroquois was aimed at exchanging mutual expertise in the areas of special operations andairborne assault. The exercise included training for low-level operations during daytime as well as nighttime.
The exercise was considered to be important because it marked the growing cooperation between the U.S.armed forces and India. It also caused disquiet in Pakistan where there was reportedly concern that theexercise would strengthen India’s position in the current military standoff because it would seem that theUnited States was siding with India.
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A vastly diverse country in terms of ethnicity, language, culture, and religion, India can be a problematiccountry to govern. Internal instability resulting from such diversity is further complicated by coloniallegacies – international borders divide ethnic groups, creating flashpoints for regional dissidence andseparatism. Kashmir and Punjab are two areas that have witnessed separatist struggles in the past decade. On alesser scale, there are similar problems of incomplete national integration in other parts of India,particularly the Northeast, where a number of smaller dissident groups are fighting either for separatestatehood, autonomy, or independence. The remote and underdeveloped Northeast is populated by a mosaic ofethnic and religious groups, both tribal and non-tribal. Migration of non-tribal peoples into less populatedtribal areas is at the root of many problems in that region.
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Between 1984 and 1994, a reported 20,000 people – civilians, militants, and security forces – werekilled in Punjab state as Sikh separatists sought to establish an independent Khalistan (land of the purecommunity of Sikh believers). By the mid-1990s, however, a security forces’ crackdown in the state hadvirtually halted terrorist and separatist activity. Applying a carrot-and-stick approach, the Indiangovernment deployed some 150,000 army troops to pacify the countryside before state assembly elections wereheld in November 1991. Probably more effective was the beefing up – in size and weaponry – of the PunjabiSikh-dominated state police. Supporters of the crackdown say that peace and freedom of movement have returnedto the state. Detractors, however, call the crackdown a reign of police terror and human rights violations andsay that the Indian government has yet to address Sikh economic, political, and social grievances.
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In February 2002, a group of Hindu Karsevaks (religious volunteers) returning by train from the city ofAyodha — the site of the razed Babri Masjid Mosque and the proposed Ram Janmabhoomi Temple — were attackedby a Muslim mob in the town of Godhra, Gujarat, and 58 people were incinerated. In the sectarian rioting thatfollowed, over 900 people were killed, most of them Muslim. The inability of the state government to restorelaw and order led to the insertion of the Indian military into the state. Despite military help, sporadicviolence continues. Indian and foreign human rights groups have been critical of the handling of the situationby the Gujarat and Indian governments. The seemingly poor response by the government led to a motion tocensure it in the Indian parliament. While the Bharatiya Janata Party (BJP) survived the censure, some of itscoalition partners, such as the Telugu Desam Party (TDP), expressed their displeasure against the government’spolicies by abstaining from voting. The government’s inability to successfully quell violence in Gujarat hasled to rifts within India’s National Democratic Alliance — a coalition led by the BJP. In July thetroubled Narendra Modi led government in Gujarat was finally dissolved.
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According to the U.S. State Department India Country Report on Human Rights Practices for 2001(March 2002), there continued to be significant human rights abuses, despite extensive constitutional andstatutory safeguards. “Many of these abuses are generated by a traditionally hierarchical social structure,deeply rooted tensions among the country’s many ethnic and religious communities, violent secessionistmovements and the authorities’ attempts to repress them, and deficient police methods and training. Theseproblems are acute in Jammu and Kashmir, where judicial tolerance of the Government’s heavy handedanti-militant tactics, the refusal of security forces to obey court orders, and terrorist threats havedisrupted the judicial system.”
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In dealing with regional dissidence, the Indian government has employed a wide range of securitylegislation, including laws that permit authorities to search and arrest without warrant and detain personsfor a year without charge or bail. Other security laws prescribe sentences of not less than 5 years fordisruptive speech or actions. Special courts have been established that meet in secret and are immune from theusual laws of evidence. In some cases, security forces are given permission to shoot to kill. A reported 5,000Kashmiris currently are in jail under anti-terrorist laws. In general, India has denied international humanrights groups, including Amnesty International and Human Rights Watch, official access to Kashmir, Punjab, andother sensitive areas. In 1995, however, the Indian government allowed the International Committee of the RedCross (ICRC) permission to begin a program of prison visits in Jammu and Kashmir. ICRC representatives alsocontinued training police and border security personnel in international humanitarian law. Both AmnestyInternational and Human Rights Watch have expressed grave concern over serious human rights abuses by militantgroups in Kashmir and Punjab, including kidnaping, extortion, and killing of civilians.
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In order to combat terrorism, the Indian parliament passed the Prevention of Terrorism Act (POTA, March 26,2002) in a rare joint session. POTA allows suspected terrorists to be held for up to 180 days without chargesbeing filed against them. The law gives the police broad powers to detain terror suspects, intercept theirtelephone and internet communications, and cut their funding sources. It also permits withholding the identityof witnesses, making confessions made to police officers admissible evidence, and giving the public prosecutorthe power to deny bail. Little discretion is given to judges regarding the severity of sentences.
Both Indian and international human rights groups have come out against the law. They argue that POTA is athrowback to India’s Terrorist and Disruptive Activities (Prevention) Act of 1987 (TADA) – a draconian lawthat was used to detain those suspected of carrying out “anti-national” activities. TADA’simplementation led to widespread human rights violations – particularly the lengthy detention withoutcharges of innocent people. In 1995, following a sustained campaign by domestic human rights organizations,the National Human Rights Commission (NHRC), politicians, and international organizations, TADA wasallowed to lapse (i.e., Parliament did not review the Act). By order of the Supreme Court, the majority ofthose detained under TADA were released on bail, and Review Committees examined their cases. Cases againstalmost 24,000 people were dropped as a result of such reviews. In July 2002, Vaiko, the leader of a breakawayparty in the state of Tamil Nadu, the MDMK, was the first non-Muslim to be arrested under POTA for his supportfor the Liberation Tigers of Tamil Eelam.
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A secular nation, India has a long tradition of religious tolerance (with occasional lapses), which isprotected under its constitution. India’s population includes a Hindu majority of 82% as well as a largeMuslim minority of more than 120 million (12%). Christians, Sikhs, Buddhists, Jains, and others each totalless than 3%. Although freedom of religion is protected by the Indian government, human rights observers havenoted that India’s religious tolerance is susceptible to attack by religious extremists. Government policydoes not favor any group, but some fears have been raised by the coming to power of the Hindu nationalistBharatiya Janata Party (BJP) since 1998. In 1999-2000, the BJP government came under increasing criticism,both domestically and internationally, as a result of a number of incidents in which Indian Christians wereattacked or killed and their places of worship destroyed, particularly in Gujarat, Orissa, and Tamil Nadustates. According to Indian press reports, most of the attacks allegedly were carried out by Hindu nationalistorganizations associated with the BJP. Other incidents of violence and intolerance toward religious groups –Muslim, Sikh, Christian, and Hindu – continue to occur in many parts of the country, including Jammu andKashmir, Punjab, Bihar, and the Northeast.
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Child labor is a serious human rights problem for India, as well as other South Asian countries. Accordingto the State Department’s Human Rights Report, enforcement of child labor laws in India is weak, andestimates of child laborers range as high as 55 million. A major factor is India’s lack of a compulsoryeducation law requiring even primary education. As a result, an estimated 87 million out of 203 million Indianchildren between the ages of 5 and 14 do not attend school. Many of those not in school are sent to toil asagricultural workers, domestic workers, or restaurant helpers. Many others work long hours under cruelconditions in cottage industries making carpets, firecrackers, brassware, and handicrafts to help supplementfamily income, with no opportunity for education.
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A National Human Rights Commission (established in 1993) has investigated abuses in Punjab, Kashmir, andthe Northeast; supported training programs for security forces; and made recommendations to the central andstate governments. Seriously understaffed, the NHRC received an estimated 40,700 complaints in 1998-99. TheSupreme Court also has become more active in combating the custodial excesses of the police by placingstringent requirements on arrest procedures and granting compensation for police abuse victims. In 1997, theSupreme Court ordered prison reforms addressing overcrowding, torture, and neglect of health and hygiene ofprisoners. In 1997, India signed the U.N. Convention Against Torture and Other Cruel, Inhuman, or DegradingTreatment or Punishment.
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Economic reforms begun in 1991, under the Congress-led government of then Prime Minister Narasimha Rao andhis finance minister Manmohan Singh, brought a growth spurt and flood of foreign investment to India in themid-1990s. Annual direct foreign investment rose from about $100 million in 1990 to $2.4 billion by 1996. Morethan one-third of these investments were by U.S. companies, including IBM, Motorola, Enron, Coca Cola, Pepsico,Merrill Lynch, AT&T, Raytheon, Kellogg, Procter & Gamble, and Ford. Reform efforts stagnated, however,under the weak coalition governments of the mid-1990s. The Asian financial crisis and economic sanctions onIndia, as a result of its May 1998 nuclear tests, further dampened the economic outlook.
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Following the 1999 parliamentary election, the Vajpayee government kicked off a second-generation ofeconomic reforms – including removing foreign exchange controls, opening the insurance industry to foreigninvestment, privatizing internet services, and cutting tariffs – with the goal of attracting $10 billionannually in foreign direct investment. Once seen as favoring domestic business and diffident about foreigninvolvement, the government appears to be gradually embracing globalization and has sought to reassure foreigninvestors with promises of transparent and nondiscriminatory policies.
As India’s largest trading and investment partner, the United States strongly supports New Delhi’scontinuing economic reform policies. U.S. exports to India for 2000 were $3.7 billion, while U.S. imports fromIndia for 2000 totaled $10.7 billion. Despite significant tariff reductions and other measures taken by Indiato improve market access, according to the report of the United States Trade Representative (USTR) for 2000, anumber of foreign trade barriers remain. U.S. exports that reportedly would benefit from lower Indian tariffsinclude fertilizers, wood products, computers, medical equipment, scrap metals, and agricultural products. Theimport of consumer goods is restricted, and other items, such as agricultural commodities and petroleumproducts, may only be imported by government trading monopolies. In December 1999, Parliament passed thelong-awaited Insurance Regulatory and Development Authority Bill, which will open India’s insurance industryto domestic and foreign private insurers (participation restricted to ownership of 26% in joint ventures).State-owned banks account for 85% of the banking business and have been widely criticized for theirinefficiency and poor service. Since 1999, foreign banks have been allowed to open 12 new branches annually.
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Inadequate intellectual property rights protection, by means of patents, trademarks and copyrights, hasbeen a long-standing issue between the United States and India. Major areas of irritation have includedpirating of U.S. pharmaceuticals, books, tapes, and videos. U.S. motion picture industry representativesestimated their annual losses due to audiovisual piracy to be $66 million. In April 2001, the USTR again namedIndia to the Special 301 Priority Watch List for its lack of protection and enforcement of intellectualproperty rights.
Sometime in 1999, the population of India crossed the 1 billion mark and is projected to exceed that ofChina by 2035. One-third of India’s people live below the poverty line – India has more poor people thanAfrica and Latin America combined – and half its children are malnourished. India has more HIV-infectedpeople (4 million) than any other country. The already low country-wide female literacy rate of 39% dips to30% in some regions and rural areas. Nearly 40% of India’s urban population live in slums with no access toclean water and sanitation services..
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The U.S. foreign aid appropriation for India for FY2002 will devote $70.9 million in DevelopmentAssistance/Child Survival and Health Programs (DA/CSH); $7 million in Economic Support Funds (ESF); $86.4million in P.L. 480 food assistance; $1 million in IMET; and $900,000 in Nonproliferation, Anti-terrorism,Demining, and Related Programs (NADR-ECA). The major USAID goals in India for FY2002 include: encouragingbroad-based economic growth; stabilizing population growth; enhancing food security and nutrition; protectingthe environment; reducing transmission of AIDS/HIV and other infectious diseases; and expanding the role andparticipation of women in decision-making. P.L. 480 funds go to providing food assistance, largely throughprivate voluntary agencies. In 2001, the Office of U.S. Foreign Disaster Assistance (USAID/OFDA) gave $3.6million in disaster assistance for flood relief in West Bengal, $1 million for floods in Orissa, $12.8 millionfor earthquakes, and $1.2 million for drought relief. The United States is the third largest bilateral aiddonor to India, after Japan and the United Kingdom. The Administration’s FY2003 aid request includes $75.2million for DA/CSH; $25 million for ESF; $1 million for IMET; and $50 million for Foreign Military Financing (FMF).
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India is the world’s largest producer of legal opium for pharmaceutical purposes, some of whichreportedly is diverted illegally to heroin production. Opium is produced legally in the states of MadhyaPradesh, Rajasthan, and Uttar Pradesh. India serves as a major transit route for drugs originating inAfghanistan, Pakistan, and Burma, and also is a major supplier to those countries of the chemical used inmanufacturing heroin. Thousands of gallons of acetic anhydride reportedly are smuggled by camel throughRajasthan state to Pakistan, where some of it is passed on to drug manufacturers in Afghanistan. Smalleramounts of the chemical, which is produced mainly for the tanning industry, are also smuggled through India’sNortheast to heroin producers in Burma. Most of the heroin transiting India is bound for Europe. India itselfhas an estimated 1.2 million heroin addicts and 4.5 million who are addicted to opium. In the Northeasternstate of Manipur, needle-sharing by heroin users has contributed to the spread of the AIDS virus, with 70% ofdrug users in that state reportedly infected with AIDS.
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India’s counter-narcotics efforts are hampered by lack of political and budgetary support, lack ofinfrastructure in drug-producing areas, and corruption among police, government officials, and localpoliticians. U.S. counter-narcotics assistance to India funds training programs for enforcement personnel andthe Indian Coast Guard. In March 2001, India was again included on the annual list of major illicit drugproducing and transiting countries eligible to receive U.S. foreign aid and other economic and trade benefits.
