<div><em>US has been eyeing policy changes that Modi was expected to bring in, writes </em><em><strong>Rajendra Abhyankar</strong></em></div><div> </div><div>Prime Minister Narendra Modi again visits New York from 23 to 28 September 2015 for the UN Sustainable Development Summit. Yet the focus of his visit will be business and technology with visits to the Silicon Valley. It was the symbol of India’s prowess in information technology, innovation and entrepreneurship when this century began. It is well to recall this potential at the present time when there is considerable scepticism about the promised potential of the Indian economy. </div><div> </div><div>Studied preparations have seen the New Delhi visit of US Assistant Secretary of State for South and Central Asia Nisha Desai Biswal to discuss points of common interest. With continuing tensions with Pakistan, Susan Rice, the US National Security Advisor has made an impromptu visit to Islamabad on 30 August 2015 in an effort to rein in their ally. Modi’s visit will be preceded by the first India-US commercial and strategic dialogue in Washington from 21 to 23 September 2015 led by Foreign Minister Sushma Swaraj and Commerce Minister Nirmala Sitharaman.</div><div>US business and technology sector has been keenly eyeing policy changes that Modi was expected to bring in since the Indian market still remains economically buoyant and politically stable. However, Budget 2015 did not bring the expected changes in foreign direct investment caps or close the pending issue of retrospective corporate taxation. </div><div> </div><div>In the US view, the Indian trade and investment structure remains very difficult and has prevented a bilateral investment treaty. Also, it has prevented the US supporting India’s entry into multilateral economic forums like the Asia-Pacific Economic Forum (APEF). Similarly, the setback on the land acquisition Bill and the government’s inability to find a via media to ensure a productive monsoon session have all impacted the positive sentiment that Modi created within the US government, business sectors and the Indian-American community. </div><div> </div><div>An increasingly charged US presidential election scenario, with an abundance of Republican aspirants led by Donald Trump and a widening Democratic field led by Hillary Clinton, has made Barack Obama a lame-duck president. Most analysts are focusing on primarily the economic benefits that can be pulled out of the Modi visit.</div><div> </div><div> Major US think tanks have set up task forces or have got their India specialist to produce reports on what can be expected from India-US engagement. Emphasising that economic outcome alone would boost the tenor of the overall relationship, Ashley Tellis of the Carnegie Endowment for International Peace writes that ‘economic engagement with India is important to the US if it wants to maintain international primacy, while the US is important for India’s attainment of its great power ambitions’. This seems prophetic coming on the heels of the unexpected turmoil in global financial and commodity markets caused by China’s multiple devaluations of the yuan.</div><div> </div><div>While looking at a two-year time-frame, till the next US President assumes office, the US observers are prepared to take the long view believing that Modi will succeed in enacting long-delayed reforms that will benefit India and make possible free-trade agreement between the two countries. </div><div> </div><div>The US and India can make incremental progress on some of the pending bilateral issues provided Obama makes trade and economics a much higher priority; and India moves ahead with its domestic economic reforms to encourage US business to further enter India. Also, the US needs to display some patience by not pressurising the Modi government to damage any of its other bilateral relationships like with Iran. </div><div> </div><div><em>The author earlier served as India’s ambassador to the European Union and other countries and is currently Professor of Practice of Diplomacy and Public Affairs, School of Public and Environmental Affairs, Indiana University, Bloomington</em></div><div> </div><div>(This story was published in BW | Businessworld Issue Dated 05-10-2015)</div>
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