Looking East, Looking West: U.S. Support for India's Regional Leadership
Assistant Secretary, Bureau of South and Central Asian Affairs
Thank you Nick, for that warm introduction and thank you for the outstanding legacy you left in advancing the U.S.-India partnership during the Bush Administration. You’ve got so many of your former colleagues coming to Harvard, it’s a rather unfair disadvantage! It’s a great honor to be here today and I am particularly pleased to be back at my alma mater. I’d like to thank the Belfer Center, the Future of Diplomacy Project, and the India & South Asia Program for hosting such a timely and relevant event.
Harvard’s South Asia Institute is certainly a fitting place for our topic today – India’s emergence as a leader in its region and beyond. Today, I’d like to talk about India’s growing influence, felt in the East through its “Look East” policy and in the west, particularly as we move toward the transition in Afghanistan.
I’ll highlight how India’s engagement in these areas is crucial to U.S. foreign policy objectives and our pursuit of a stable, secure and prosperous region. India’s leadership has powerful implications that extend beyond its immediate neighborhood – as a beacon of democracy, stability, and growth. India has much to offer all of us, including communities right here in Cambridge.
Harvard University’s increased engagement with India, through events like this, through its South Asia Institute, its research center in Mumbai, President Faust’s 2012 visit to India, through over 1,500 Harvard alumni in India, as well as a myriad of research projects, academic collaborations and student and faculty exchanges, testify to India’s growing prominence and our recognition of its increasing importance in the global arena.
Massachusetts, likewise, has become a pioneer in forging closer relations with this key partner. The State Department strongly champions and supports state-to-state and city-to-city engagement, which is now a vital part of advancing our economic and people-to-people relationships. This year alone, at least eight American Governors are leading trade and other missions to India, not only to develop new markets but to attract job-boosting investments.
Massachusetts was an early pioneer: back in 1995, when then-Governor Weld announced plans to forge an alliance with Karnataka, such engagement was a novel concept and a new approach. Governor Weld had the foresight to know that those who didn’t pursue ties with India would miss out on the many rewards this relationship has to offer. His delegation, consisting of 22 U.S. companies, paved the way for numerous U.S. firms to open in and around Bangalore. Today, Massachusetts is one of India’s top 25 trading partners in the world, and last year India received nearly $300 million of this state’s exports.
But I hardly need to tell this audience how critical the U.S.-India relationship is. Those of you involved in collaborations with India, particularly in academia and research, are fully aware of the benefits. But our bilateral partnership benefits not only our two nations; it is of vital importance to a global vision for a future of shared prosperity.
During his visit to India in 2010, President Barack Obama recognized the promise of our shared future and hailed the U.S.-India relationship as “one of the defining partnerships of the 21st century.” We and our Indian friends have taken significant steps to realize that vision.
We established a Strategic Dialogue chaired by the Secretary of State and External Affairs Minister to give strategic direction to the wide range of bilateral dialogues between our two governments.
We have expanded counterterrorism cooperation, intelligence sharing, and law enforcement exchanges that have helped make both of our countries safer, but clear-eyed about the threats that persist.
Bilateral trade has grown by 50% from $66 billion to $93 billion in the last four years and is set to cross $100 billion this year. Indian foreign direct investment in the United States increased from $227 million a decade ago to almost $4.9 billion in 2011 – investments that have created and support thousands of U.S. jobs.
Another growing component of our bilateral relationship with India is defense trade. Since 2000, sales to India have surpassed $8 billion, representing both an excellent commercial opportunity for U.S. companies but also advancing a vital component of our bilateral security relationship. We will continue to pursue defense trade cooperation with India, including a whole-of-government effort led by Deputy Secretary of Defense Ash Carter to reduce bureaucratic impediments, ease transactions between buyers and sellers, increase cooperative research, and focus on co-production and co-development opportunities.
We have grown our partnership with India on export controls and non-proliferation. We have worked closely with our companies to help them move deeper into India’s nuclear commercial markets, and we hope to announce more tangible commercial progress by the next Strategic Dialogue.
We have increased our collaboration on clean energy through programs such as the U.S.-India Partnership to Advance Clean Energy (PACE). Since its creation, PACE has mobilized over $1.7 billion in renewable energy financing to India and has driven full-spectrum activity from basic research to development and commercialization in solar technology, advanced biofuels, and building efficiency.
India is hosting the Fourth Clean Energy Ministerial (CEM) in New Delhi later this month. The CEM offers a tremendous opportunity for partnership on a range of clean energy technologies, particularly in buildings and appliance efficiency, that are among the world’s most ambitious.
And we have witnessed an expansion of our already robust people-to-people ties, particularly in the educational arena, where there is great demand. India has about 600 million people under 25. The next generation can only fulfill their roles as economic drivers if equipped with the right training and skills. India aims to increase its higher education enrolment from under 20 percent to 30 percent by the end of the decade. That means it needs 50,000 more colleges and 1 million more faculty.
Since the first iteration of the U.S. India Higher Education Dialogue last year, we have focused our efforts on such critical areas as skills training and workforce development by strengthening community college collaboration.
We are preparing for another round of Obama Singh 21st Century Knowledge Initiatives awards, which will further partnerships and junior faculty development between U.S. and Indian higher education institutions in priority fields and we have sought to encourage more Americans to study in India and build American expertise about India and by ramping up our Passport to India initiative.
With its strong democratic institutions, unprecedented demographic growth, economic promise and rising military capabilities, India is poised to play a critical leadership role both regionally and globally. With rising power comes greater global responsibility and in moving beyond its tradition of non-alignment, India has established its credentials as a responsible player in the global arena. We are committed to working together, along with others in the region, toward the evolution of an open, balanced, and inclusive architecture.
India has long been an integral member of the Asia-Pacific region, sharing cultural and historical ties that have laid the foundation for its expanded engagement of today. With its "Look East" Policy, initiated in 1991, India began to work more closely with its Asian partners to engage the rest of the world, reflecting the belief that India’s future and economic interests are best served by greater integration with East and Southeast Asia.
Today, India is forging closer and deeper economic ties with its eastern neighbors by expanding regional markets, and increasing both investments and industrial development from Burma to the Philippines. India is also seeking greater regional security and military cooperation with its neighbors through more intensive engagement with ASEAN and other near neighbors. This week, in fact, India and China held their annual counterterrorism dialogue and focused on pan-Islamic extremism in the backdrop of Afghanistan’s transition. Such interaction evinces Beijing and Delhi’s interest in coordinating to work together for stability in Kabul in 2014 and beyond.
Trade, and by extension maritime security, are key components of our bilateral collaboration. The economic dynamism of South, Southeast and East Asia, along with improving relations between India and its neighbors to the East, has spurred the region’s interest in revitalizing and expanding road, air, and sea links between India, Bangladesh, Burma, and the rapidly expanding economies of ASEAN. From 2011 to 2012, trade between India and the countries of Southeast Asia increased by 37%.
This emerging Indo-Pacific Economic Corridor, as we have come to call it, is a boon for the region and for the United States, providing our own economy with potential new markets. Linkages and infrastructure investments between the rapidly expanding economies of South Asia and those of Southeast Asia are a critical component to integrating regional markets to both accelerate economic development and strengthen regional stability, while helping unlock and expand markets for American goods and services.
An India that is well-integrated into the Asia’s economic architecture, that pursues open market policies, and that has diverse and broad-based economic relationships across the East Asia region is not only good for India, but is good for the United States and the Asia-Pacific region as a whole.
But trade can only prosper when maritime security is assured. Oceans are essential to India’s security and prosperity, as they are to ours. By volume, 90% of the goods India trades are carried by sea. India therefore has a strong interest in guaranteeing unhindered freedom of navigation in international waters, the free flow of commerce, and the peaceful resolution of maritime disputes. But beyond its own economic benefit, India realizes that the economic integration enabled by the improvements of connections across Asia, will lead to prosperity that benefits all nations.
India’s growing naval capacity and modernization have enabled its strong presence across the Indian and Pacific Oceans and further bolstered its role as a net security provider in the maritime domain. Already in the Western Indian Ocean region, New Delhi is demonstrating its growing maritime capabilities with a robust counter-piracy approach that serves common regional interests and many of their own nationals held hostage in Somalia. As a founding member of the international Contact Group on Piracy off the Coast of Somalia, India has shown great leadership in the efforts to confront and combat piracy stemming from Somalia which threatens trade flows to and from Asia.
Our shared vision for economic integration and the promotion of regional stability also extends westward. The United States and India are both strong supporters of a more economically integrated South and Central Asia, with Afghanistan at its heart -- what we call the New Silk Road vision.
At the core of this vision is an Afghanistan at peace and is firmly embedded in the economic life of the region. Such an integrated region will be better able to attract new investment, benefit from its resource potential, and provide increasing economic opportunity and hope for its citizens. Improving connections between South and Central Asia is made all the more urgent as Afghanistan moves through the transition process and puts its economy on a more sustainable private sector-led footing.
The countries of the region have embraced a new vision for Afghanistan that places it at the center of a rejuvenated network of commerce, communications and energy transmission, a “land bridge" connecting the Middle East and central Asia to the dynamic markets of China, India and Southeast Asia. Its economic development and ultimate economic integration into the larger network of regional markets is yet another piece of the New Silk Road tapestry.
As Afghanistan increasingly takes the lead in its own security, political, and economic situation, we also strongly support the constructive role that India is playing in Afghanistan's ongoing development. We look to India to play an active part in ensuring that that stability and security endure and that the gains made in Afghanistan over the past 11 years are sustained. Indeed, great challenges lie ahead. But India is committed to our shared vision for a peaceful, stable and secure Afghanistan and has already proven its commitment to assume a greater role in enabling that vision to come to fruition.
In 2011, India pledged through the signing of a wide-ranging strategic agreement to train and equip Afghan security forces. As the largest regional provider of humanitarian and reconstruction aid to Afghanistan, India has given some $2 billion in aid to the country. Indian public and private companies are building the infrastructure which will carry the nation forward. They have built highways from Kandahar to Kabul and a new parliament building in the capital, put transmission lines between Afghanistan and Uzbekistan and have plans to power Afghan cities through the Salma dam project and to help Afghanistan realize its mineral wealth through development of the Hajigak iron ore mines.
On the soft power side, India’s Bureau of Parliamentary Studies and Training invited most senators in Afghanistan’s Upper House, the Meshrano Jirga, for a training session in legislative and budgetary processes in New Delhi, much as the JFK School of Government does for new lawmakers in Washington.
There’s perhaps no better example of the potentially impact of the New Silk Road vision for Afghanistan and its region than the Turkmenistan-Afghanistan-Pakistan-India pipeline, or TAPI. By connecting abundant energy reserves in Turkmenistan with rapidly rising demand for that energy in South Asia and providing Afghanistan with much-needed transit revenue, TAPI can be transformative for the region. While there’s still much to be done to make this project a reality, we are closer today than anyone would have thought possible just a few years ago, thanks in no small part to Indian leadership.
Beyond these infrastructure efforts, India has rallied the international community to encourage further development and to garner the support needed to enable Afghanistan’s successful transition. Last year New Delhi hosted a major summit on international investment in Afghanistan’s economy. As Afghanistan shifts the foundation of its economy from aid to trade in the coming years, India’s regional role as a driver of economic prosperity and anchor of democratic stability becomes even more important.
Later this month in Almaty, the United States, India, and other countries of the region, will meet to discuss how we can best support a secure and prosperous Afghanistan, integrated into its region. This gathering is part of the Istanbul Process, in which neighbors and near-neighbors support Afghanistan through a range of initiatives that advance security and regional economic cooperation. India has already demonstrated a clear leadership role through its chairing of a working group focused on expanding cross-border commercial and business-to-business relations.
In conclusion, in Afghanistan as in so many other areas, meeting the challenges of today and seizing the opportunities of tomorrow demand cooperative responses and lasting partnerships. We have found, in India, a strong partner in our shared quest for peace, stability, and prosperity in South Asia, the Asia-Pacific region, and beyond. As India continues to grow economically and extends its engagement outward, we see that our strategic investment in partnership with India is paying dividends that will last for generations.