February 23, 2020
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US: No Shift In Policy

US: No Shift In Policy

INDIA-watchers are working overtime to monitor the general elections. Sumit Ganguly, who teaches at the Hunter College of the City University of New York, thinks the economic reforms will "go on, whatever the party at the Centre". The hardest thing, he notes, would be for any party to take on the next phase of reforms—that is, the dismantling and selling off of the public sector, reforms in services and exit policy—which "any party in power will need to tackle".

On foreign policy and security issues, Ganguly does not think there will be any marked shift: "People like Inder Gujral or Jaswant Singh may make some wild noises, but I see no substantial change either in terms of US policy or the stand on CTBT. I do not foresee any changes either in terms of foreign policy or defence issues." 

Says Sony Devabhaktuni, a research associate at the Stimson Centre, a Washington think-tank: "Regardless of who is in charge, the BJP will have a strong influence that will prevent whoever is in power from reneging on the nuclear option or from taking any steps to talk with Pakistan on the Kashmir issue. This will be a factor in how things play out. Add to this the fact that the situation in Pakistan is such that Benazir Bhutto is not in a position to give away the nuclear option or to make any concessions on Kashmir." On the CTBT issue, he says: "Even after the elections, India will maintain its position of linkage because the BJP will have a strong influence. Polls indicate that the nuclear option is a very popular one in India and signing the CTBT would, in effect, be giving up the nuclear option." 

Shaun Gill, of the South Asia and India Program at the Centre for Strategic and International Studies in Washington, says the US business community is a little fearful, as is evident from the significant slowdown in foreign investment over the past eight months since Enron. He feels that US business houses have become accustomed to Prime Minister P.V. Narasimha Rao's centralised management style and have developed comfortable and established relationships with the Administration over the past five years. "That is not to say that they are content with the current state of reforms or the degree to which liberalisation is proceeding. The real fear for US business is not so much who is in power, but the unpredictability of change and the sometimes Herculean efforts required to re-educate and re-establish relationships after a sweeping change of government."

 Contrary to the BJP's rhetoric supporting the continuation of economic reforms, Gill thinks the party has instilled a certain fear in the business community. "Events like Enron and KFC are glaring aberrations to the BJP's professed commitment to liberalisation and support of transnational corporate participation in the Indian market. Statements about limiting foreign participation to only the high-tech and capital-intensive areas, thereby excluding the country's burgeoning consumer and service sectors, add to American fears about a potential swadeshi backlash."

 In terms of foreign policy and security, Gill feels there is significantly more room for a backslide in relations because US foreign policy towards India is, at best, "ill-defined". The State Department and Pentagon would also like to see Rao form the next government. Says Gill: "The fear with the BJP is that the party has never held national power and no one is quite sure of the veracity of the party's claims to enact missile and nuclear regimes. Given that the issue of nuclear and missile proliferation has been one of finesse rather than substantive policy over the past five years, a jingoistic, nationalist BJP government could quickly change the playing field between India and the US, publicly forcing America's hand in a number of critical areas."

The State Department has, however, refused to comment citing its policy of not speculating on a country's forthcoming elections.

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