Assessing India-U.S. 2+2 Dialogue

What is the issue?

• The India-U.S. defence relationship has been given a significant boost after the recent 2+2 Dialogue in Delhi. (Click here to know more)
• However, India must take a balanced and cautious view while deepening defence ties with the U.S.

What is the significance of the meet?

• The India-U.S. defence relationship was strengthened with the signing of three agreements:

1. the Communications Compatibility and Security Agreement (COMCASA)
2. “hotlines” between the Defence and Foreign Ministers of both countries
3. the first tri-services military exercises between the two countries

• COMCASA - It is the third of four “foundational” agreements signed after more than a decade of negotiations.
• It will ensure interoperability between the two countries’ armed forces and allow hi-tech equipment sales to India.
• The agreement has also been described as making India a “near ally” of the US.
• It is perceived as an inevitable consequence of the large amount of U.S. defence hardware India has been purchasing.
• This will further increase, given the U.S. decision to include India in the Strategic Trade Authorisation (STA-1).
• China - Advancing “a free, open, and inclusive Indo-Pacific region” was discussed upon.
• The countries also mentioned promoting sustainable “debt-financing” in the region.
• These are clearly aimed at Beijing’s role in the South China Sea and the Belt and Road Initiative projects.
• Relationship - The 2+2 discussions was held after two previous cancellations this year.
• The dialogue has thus been significant in India-U.S. relationship after months of drift and occasional discord.

What are the concerns?

• While trade was addressed, India did not receive a clear-cut assurance of its GSP (Generalised System of Preferences) status being restored.
• It neither received any waivers on steel and aluminium tariffs imposed by the U.S.
• Instead, U.S. officials said that they expect India to increase imports of American oil and gas as well as aircraft.
• This is in order to wipe out the trade surplus India enjoys.
• It is unclear if the Centre has agreed to this anti-free market demand, but it remains a concern.
• The U.S.’s other demand, to “zero out” oil imports from Iran by November, is also contentious.
• It would hurt India economically at a time when the dollar is strengthening and fuel prices are going up.
• It would also have implications in terms of India's substantial engagement with Iran.
• No public statement was made on U.S.'s actions on India’s investment in the Chabahar port once U.S.'s full sanctions begin in November.
• Also, U.S. officials gave no firm commitment that India would receive a waiver to purchase Russian hardware, beginning with the S-400 missile system.
• India must work with the U.S. in the coming future to ensure that the 2+2 dialogue did not benefit only the U.S.
• India needs to ensure that it does not sacrifice its regional geo-political and broader global economic interests.

Source: The Hindu, BusinessLine