Partnership between India and the USA strengthened in the 21st century with shared values and converging interests. In the year 2005, the two countries signed the ‘Strategic Partnership’ agreement. After 15 years, the two nations signed the ‘Comprehensive Global Strategic Partnership’ partnership in 2020, which contributed to Indo-US relations. This manifests itself in many ways, like frequent high-level exchanges, enhanced cooperation, and the evolving nature of the relationship.

Historical background – Phases of India-US relations

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The leaders of Indian Independence were highly impressed with the democratic ideals adopted by the US Political system. This pushed the Indian leaders to engage with the US soon after India got its independence.

India-US bilateral relations have undergone significant transformations since India gained independence from British rule in 1947.

Early Years (1947-1960s):

After independence, India pursued a policy of non-alignment, choosing not to align with any major power bloc during the Cold War.
The US recognized India’s independence early on and maintained diplomatic relations, albeit with some reservations due to India’s non-aligned stance.
Bilateral relations were characterized by cautious engagement, occasional tensions, and limited cooperation.

Tensions and Cooperation (1960s-1970s):

The 1962 Sino-Indian War and the 1965 Indo-Pakistani War strained India’s relations with both China and Pakistan, while the US provided military assistance to Pakistan during the conflict.
India’s close ties with the Soviet Union during the Cold War further strained relations with the US.
However, there were also areas of cooperation, such as the Green Revolution in the 1960s, where the US provided agricultural assistance to India.

Post-liberalisation Engagement between India and the US

1991 Kicklighter proposals (Lt. Gen. Claude Kicklighter ) suggested establishing contacts between the three Services to promote exchanges and explore areas of cooperation.

In 1992, India and the US began PASSEX which later became the Malabar Exercise.
In 1995, an agreed Minute on Defence Relations between the two nations was signed which established India’s formal cooperation with the US in the area of defence. This led to the establishment of a Defence Policy Group (DPG): It was the apex institutional dialogue mechanism for Defence Cooperation between India and the United States.

Nuclear tests in 1998.

India’s nuclear tests in 1974 and 1998, followed by Pakistan’s tests, led to international condemnation and sanctions, including from the US. Bilateral relations hit a low point in the late 1990s, with the US imposing economic and military sanctions on India after its nuclear tests in 1998.

The U.S. responded angrily to the Nuclear tests of 1998 by imposing a whole slew of economic sanctions and leading the international condemnation campaign.

Even the Malabar Exercise was put on hold in 1998 and was resumed in 2002.

Re-engagement and Strategic Partnership (2000s):

The early 2000s saw a significant shift in India-US relations, marked by efforts to overcome past differences and build a strategic partnership.
The visit of Indian Prime Minister Atal Bihari Vajpayee to the US in 2000 paved the way for closer cooperation.
An intensive engagement followed with 18 rounds of talks between the then M/o External Affairs, the late Jaswant Singh, and then U.S. Deputy Secretary of State Strobe Talbott spanning two years.

These extensive talks culminated in the signing of several important agreements between the US and India through which both countries expanded cooperation in various fields, including defence, counterterrorism, trade, and technology. It helped bring about a shift in perceptions and Sanctions were gradually lifted in 2005.

Defence Framework agreement

Finally, in 2005, a 10-year Defence Framework Agreement was signed.

It focused on defence trade, joint exercises, personnel exchanges, collaboration and cooperation in maritime security and counter-piracy operations, exchanges between each of the Services, etc.
India and the US renewed this Defence Framework Agreement for the next 10 years 2015 to 2025.

Civil Nuclear Agreement

In 2008, a Civil Nuclear Agreement was signed between India and the US. The biggest challenge in the Indo-US relation was that after 1998, the US was highly suspicious of India for diverting the supply of fissile material for its nuclear power to create more atomic bombs.

It took more than three years and a lot of negotiations to come to an agreement and to come to fruition as the ratification of the agreement had to go through several complex stages, including:

Amendment of US domestic law, especially the Atomic Energy Act of 1954,
A civil-military nuclear separation plan in India,
An India-IAEA (International Atomic Energy Agency) safeguards (inspections) agreement
The grant of an exemption for India by the nuclear suppliers group.

The Indo-US Civil Nuclear Deal (also known as the 123 Agreement) was finally achieved and two main provisions were made:

It placed those nuclear facilities that India has identified as “civil” under permanent safeguards.
It permitted broad civil nuclear cooperation, while excluding the transfer of “sensitive” equipment and technologies, including civil enrichment and reprocessing items even under IAEA safeguards.

Additional Convention: In 2015, India ratified the Convention on Supplementary Compensation for Nuclear Damage (CSC), 1997; It seeks to establish a uniform global legal regime for compensation to victims in the unlikely event of a nuclear accident. India signed it in 2010 to deliver its commitments to stemming the landmark 2008 nuclear agreement with the United States.

2+2 Strategic Dialogue

In 2018, the India-U.S. Strategic and Commercial Dialogue (2009 -2010) was elected into the 2+2 dialogue 2018 with the (Republican) Trump administration reflecting the ‘Comprehensive Global Strategic Partnership’.

This meant the following:

Bilateral ties continued to strengthen under successive administrations in both countries, with a focus on deepening defence cooperation, enhancing economic and trade relations, and promoting people-to-people ties.
The designation of India as a Major Defence Partner by the US in 2016 further elevated defence ties, including defence trade and technology transfer.
Both countries also collaborated closely on regional and global issues, such as maritime security in the Indo-Pacific, climate change, and counterterrorism.

Joint Vision on Asia Pacific and the Quad

In 2015, a Joint Strategic Vision for the Asia-Pacific and Indian Ocean Region (IOR), was agreed upon. This led to the germination of the Idea of Quad.

2020: The Quad teamed up off the coast of Visakhapatnam in the Bay of Bengal for the first time after 2007 to carry out advanced manoeuvres, including surface, anti-submarine and anti-air warfare operations, cross-deck flying, seamanship evolutions and weapon firing exercises under Phase-I of Malabar 2020.

Australia backed out after 2007.

Importance of the India-US relationship

Strengthening bilateral ties serves the interests of both countries and contributes to peace, stability, and prosperity in the region and beyond. India and the United States hold significant importance to each other due to various factors:

Importance of India to the US:

Economic Opportunities: India represents a vast market for American goods and services. With a large and growing middle class, India offers lucrative opportunities for US businesses in sectors such as technology, healthcare, education, and infrastructure.
The counterbalance to China: India serves as a crucial strategic partner for the US in balancing China’s influence and promoting stability in the region because of the World’s largest democracy and a key player in the Indi-Pacific region.
Security Cooperation: India’s geographical location and military capabilities make it a valuable partner for the US in addressing security challenges in South Asia and beyond. Both countries collaborate on counterterrorism, maritime security, and defence technology.
Democratic Values: India’s commitment to democracy, rule of law, and pluralism aligns closely with American values. Strengthening ties with India reinforces the US commitment to promoting democratic governance and human rights globally.
Technology and Innovation: India’s thriving technology sector and pool of skilled professionals make it an attractive partner for US companies seeking collaboration in research, development, and innovation. Joint ventures in technology can drive economic growth and innovation in both countries.
Climate Change and Sustainable Development: India’s large population and growing economy make it a significant contributor to global environmental challenges. Cooperation between India and the US on climate change mitigation, clean energy, and sustainable development is crucial for addressing these challenges effectively.

Importance of the US to India:

Economic Partnership: The US is one of India’s largest trading partners and a major source of foreign investment. Indian businesses benefit from access to American markets, technology, capital, and expertise, supporting India’s economic growth and development.
Defence and Security Ties: India-US defence cooperation enhances India’s defence capabilities through technology transfers, joint military exercises, and intelligence sharing. This strengthens India’s national security and defence preparedness.
Technology and Innovation: India seeks to leverage US expertise and technology in various sectors, including information technology, biotechnology, aerospace, and renewable energy. Collaboration with American companies and research institutions fosters innovation and competitiveness in the Indian economy.
Strategic Partnership: India views the US as a key strategic partner in advancing its interests regionally and globally. Close cooperation with the US on issues such as counterterrorism, maritime security, and regional stability reinforces India’s position as a major power in the Indo-Pacific region.
Diaspora Connection: The Indian diaspora in the US is a significant bridge between the two countries, contributing to cultural exchange, trade, investment, and people-to-people ties.
Education and Research Collaboration: Indian students and researchers benefit from educational opportunities and collaboration with American universities and research institutions. Exchange programs and joint research initiatives promote academic excellence and innovation in both countries.

Areas of Cooperation

The India-U.S. bilateral cooperation is broad-based and multi-sectoral, covering trade and investment in space technology and applications. Thus, all-important areas of cooperation are discussed below:

Economic Relations:

The Ministerial Trade Policy Forum and the Ministerial Level Economic and Financial Partnership are only two ways to communicate about economic and trade issues.

The U.S. has emerged as India’s 2^nd largest trading partner after China in 2024 on account of increasing economic ties between the two countries.
In FY24, the total trade volume amounted to US$ 118.3 billion. Indian exports to the US declined by 1.32% to US$ 77.5 billion, and imports from the US dropped by 20% to US$ 40.8 billion.
Both countries created a bilateral investment policy in 2014 to encourage FDI, portfolio investment, capital market growth, and infrastructure development initiatives.
The US is also involved in the projects for the Smart Cities in Allahabad, Visakhapatnam, and Ajmer.

International cooperation

India and the United States cooperate closely with multilateral organizations, including the United Nations, G-20, Association of Southeast Asian Nations (ASEAN), Regional Forum, International Monetary Fund, World Bank, and World Trade Organization.
The United States has supported a reformed UN Security Council that includes India as a permanent member in 2021.
India is also one of twelve countries partnering with the United States on the Indo-Pacific Economic Framework for Prosperity (IPEF).
India is a member of the Indian Ocean Rim Association (IORA), at which the United States is a dialogue partner.

In 2021, the United States joined the International Solar Alliance headquartered in India. Another grouping in the Middle East in which India and the US are collaborating is I2U2 involving India, Israel, UAE, and the US which is being termed the new Quad.

Defence Cooperation

The armed forces of India and the US engage in extensive bilateral military exercises (Yudha Abhyas and Vajra Prahar)and multilateral ones with the four partners in the Quad Forum (Malabar).

Although India’s engagement with the US goes much deeper, as India is a signatory to all four foundational agreements with the US.

Foundational Agreements

India has now signed all four foundational agreements with the US.

The Logistics Exchange Memorandum of Agreement (LEMOA) in 2016 allows using their military bases for refuelling and repairs by each other.
The Communications Compatibility and Security Agreement (COMCASA) of 2018 allows both to share and secure communications during training exercises and operations.

The Basic Exchange and Cooperation Agreement for Geo-Spatial Cooperation (BECA)in 2020 allows the sharing of Geospatial Intelligence.

While the General Security of Military Information Agreement (GSOMIA) was signed a long time ago, an extension to it, the Industrial Security Annex (ISA), was signed in 2019. It allows India and the US to share military intelligence.

With this India could access the US-made weapons that it could not use during the Cold War. This has enabled India to buy $20 billion worth of arms over the last two decades. These defence purchases from the US are helping India reduce its historical dependence on Russia for its military supplies.

Space and Science and Technology

Indian Space Research Organization (ISRO) and the US National Aeronautics and Space Administration (NASA) are developing NASA-ISRO Synthetic Aperture Radar (NISAR), a microwave remote sensing satellite for Earth observation.
In June 2023 ISRO signed with NASA the Artemis Accords to participate in peaceful and sustainable civil exploration of outer space.
It is a joint initiative by the National Security Advisors of the US and India to foster cooperation and innovation in key technology domains such as AI, quantum, telecom, space, biotech, semiconductors, and defence. It was launched in January 2023.

Clean Energy

The United States and India share a common vision to deploy clean energy at scale, as reflected in both countries’ ambitious 2030 targets for climate action and clean energy.

Both are exploring avenues to increase minerals security cooperation to ensure both can advance their clean energy goals, including through the Minerals Security Partnership.
In August 2023, the India-United States New and Emerging Renewable Energy Technologies Action Platform (RE-TAP) held its inaugural meeting. Under this platform, both countries will engage in lab-to-lab collaboration, piloting and testing, and policy and planning coordination for renewable energy technologies and systems.
The United States and India also collaborate through the Strategic Clean Energy Partnership and the Climate Action and Finance Mobilization Dialogue.

People-to-People Ties

The 3.5-million-plus-strong Indian-American community is an important ethnic group in the U.S., accounting for about 1% of the total population in the country.
Indian American community includes a large number of professionals, business entrepreneurs, and educationalists with increasing influence in society.
The two countries have been working together to facilitate the travel of their respective citizens, and to this end, an MOU was signed in June 2016 to facilitate India’s joining of the Global Entry Programme for expedited immigration for eligible Indian citizens at U.S. airports.

Education Cooperation

Partnership in the Education sector is an important pillar of India-US ties with strong linkages and a history of higher education collaborations.

The India-U.S. Working Group on Education and Skill Development (WGESD) was launched in May 2023 to focus on skilling and vocational education, certification and recognition, matchmaking between higher educational institutions, and engaging with the private sector.
In September 2023 the Council of Indian Institutes of Technology (IIT Council), and the Association of American Universities (AAU) signed an MOU to establish India-US Global 12 Challenges Institute which will bring together leading research and higher education institutions.
IIT Bombay joined the Chicago Quantum Exchange as an international partner. Several IITs have strong ongoing academic research partnerships with universities in the US.

Challenges between India and the US

India and the US have a complex relationship that faces several challenges, despite significant progress in recent years. Some of the key challenges in their bilateral relations include:

US Criticism of India’s Foreign Policy:

Indian preference in international relations was non-alignment after its independence however; alliance relationships have been at the heart of US foreign policy since theSecond World War. India’s policy of nonalignment (Membership of NAM) especially during the Cold War has always been a point of concern for the West, especially the US.
After the 9/11 attacks, the US asked India to dispatch troops to Afghanistan; the Indian military vetoed the request.
When the US invaded Iraq in 2003, even then India’s erstwhile PM withheld military support.

Even today, India refuses to toe the American line on the Russian-Ukraine war and its import of cheap Russian oil continues to break records.

India’s Engagement with US Adversaries:

India has criticized the US decision to block Iranian and Venezuelan oil from the open market.
India has actively worked tobring Iran into the SCO (Shanghai Cooperation Organization). Similarly, India’s import of arms from Russia is not liked by the USA.

US’ Criticism of India’s Democracy:

Various US organizations and foundations, from time to time, with the tacit support of some Congressmen and Senators, come out with reports questioning the present state of democratic discourse, press, and religious freedom, and the condition of the minorities in India.
Some of them include the International Religious Freedom Report 2023and the Human Rights Report on India 2021 by the US State Department.

Economic Tensions:

The Atmanirbhar Bharat Campaignhas exacerbated the view in the US that India is increasingly becoming a protectionist closed market economy.
Effective in June 2019, the USA decided to withdraw duty-free benefits to Indian exporters under the GSP (Generalised System of Preferences) Programme affecting India’s export-oriented sectors such as pharma, textiles, agricultural products, and automotive parts.

Data localization move of India:

The US is home to major data giants like Google and Facebook that gather significant amounts of data from Indian consumers. India’s plan to implement data localization rules, requiring data to be stored within the country, is being opposed by the US.

Trade-related issues

IPR: The US has accused India of Intellectual Property Rights (IPR) violations and has placed India on the “Priority Watch List.”

Way Forward

To move forward and strengthen the bilateral relations between India and the US, several steps can be taken:

Strategic Cooperation

Moving Ahead with Multi-Alignment:With the Ukraine-Russia conflict, global powers have been realigning into new groupings. India has a tough task of walking a very tightrope between Russia and the US. India should calibrate this balancing act and bring dialogue and diplomacy to resolve strong differences.
Increasing defence cooperation among the two countries will also help India bridge the massive gap in military capabilities with China with strong support from the US.

China Factor:

Many CEOs are now adopting a “China plus one” strategy,seeking to diversify their supply chains. Recently, Apple’s decision to establish its first retail store in India not only enhances the country’s attractiveness to other tech companies but also showcases its capability to produce cutting-edge technology and strengthen its manufacturing potential.

Both India and the US have a strong interest in stabilizing the Asian balance of power and coping with the geopolitical churn triggered by China’s rise and Beijing’s assertiveness in Asia.

Enhancing economic Engagement

Indo-US economic engagement needs to be increased with greater flows of investment and trade. US investments in India are around $54 billion, which represents less than 1% of its global investments. Thus, US investment in India can be increased. In addition, India, too, needs to increase investments in the US, creating interdependencies between the two nations is crucial.

Greater technological cooperation:

By this India will become a developed nation by encouraging manufacturing-led export growth and infrastructural development. The India-US iCET(Initiative on Critical and Emerging Technology) is a step in the right direction. There will be a complementariness as India’s economic rise would be in the US interest just as much as US leadership of technology enablers and global affairs would be in India’s.

Cooperation in Sustainable Development:

Initiatives like the revamped US-India Strategic Clean Energy Partnership (SCEP) exemplify cooperation in fostering the growth of renewable energy deployment in India. The US can further assist by facilitating access to funds for India’s ambitious goals.
Expanding Coverage to Food Security:In addition to national security, food security is of equal importance to India, however, is being threatened by climate change with increasing temperatures affecting poorer nations disproportionately (India being no exception). India and the US can enhance cooperation in the Sustainable technologies that are necessary for the future’s nutrition security.
The US is at the forefront of technologies not just in defence, space, and semiconductors but also in agriculture. It has the potential to do good to the maximum number of people in the developing world, be it in Asia or Africa.