MCMAHON: Thank you, Operator. And welcome, everyone, to today’s Council on Foreign Relations conference call on President Trump’s trip to India. I’m Robert McMahon, managing editor of CFR.org, and I’ll be presiding over today’s discussion with Alyssa Ayres and Edward Alden. I’d like to remind the members that this conference call is on the record and it’s set for about one hour.
Now, you can see from their bios that both Alyssa and Ted are well-suited to set up this trip for us. Alyssa is CFR’s senior fellow for India, Pakistan and South Asia, and one of the authorities on U.S.-India policy. Ted is CFR senior fellow and Ross distinguished visiting professor at Western Washington University, and has closely tracked trade and competitiveness issues at CFR, as well as the Trump administration’s rather sharp pivot on free trade policy.
I’m going to be speaking with Alyssa and Ted for about fifteen minutes before opening up the call for your questions, so please start thinking about them as we get into the discussion. And, Alyssa, I wanted to start off with you with kind of a bit picture question to kick it off. It’s a relatively short trip—about thirty-six hours I’ve seen estimated. Can you sketch out for us why this trip is taking place now, and what are the main venues and agenda items that have been sketched out?
AYRES: Sure. Well, it’s hard to know precisely why this specific day, why this has been the date on which the trip came together. But keep in mind that Prime Minister Modi invited President Trump to visit India, you know, a couple years ago. And then there was an informal discussion about whether President Trump would be able to come to India for the January 26 Republic Day, as the chief guest. I don’t think there was ever a formal invitation issued for that, but the dates didn’t work out for the president. And in any case, it turned out there was an impeachment trial going on. So I would imagine that there was some thinking that the president should visit India at some point. He’s now in the last year of his term. So when that gets scheduled, hard to know. But there has been these points of invitation and kind of potential possible other dates that ended up not working out. So now we see this happening here.
The thirty-six-hour trip is a whirlwind. He’s visiting three cities. He will arrive in Ahmedabad in the state of Gujarat that is the prime minister’s home state. This is a state in western India on the coast. And the—(laughs)—some of what has made headlines about this stop in Ahmedabad is the fact that the Indian side is arranging what they’re calling a road show for President Trump that will be a drive from the airport to a not-yet-inaugurated cricket stadium that’s going to be the world’s largest cricket stadium by seating—I can seat about 110,000 people. And on this road show, on the way to the cricket stadium, Indians—the Indian side, there’s an NGO that’s managing the preparations for this, they’re creating what they call twenty-eight different stages for dance groups, youth from different states of India to perform as both Modi and Trump drive by, to showcase the diversity of India. I think we’ll have to actually see this to get a better sense really of what it will mean.
But then the two will arrive at the stadium together. And that is supposed to be—I mean, I’m not sure if it’s going to end up being like many of the president’s domestic rallies, but people are talking about this as something that will be similar to the joint appearance that they made in Houston earlier this year in an event that was called Howdy Modi, when Mr. Modi traveled to Texas. President Trump won’t stay in Ahmedabad for very long. He’s going to go onto Agra, which is where the world-famous Taj Mahal is. He and the first lady will see that site. I think they’ll only be there for about an hour, and then they’ll move onto Delhi, where obviously they’ll have the bilateral meetings, the government meetings, the actual purpose of the visit.
MCMAHON: So an opportunity for spectacle, which both leaders cherish, as well as bonding, which they illustrated on previous visits. And it’s happening though at a time when there has been quite an uptick in trade discussions between the two sides. And you’ve sketched those out, actually, looking at, in particular, eight—eight trade issues in particular in what we published on CFR, we call a field guide to the U.S.-India trade issues or trade tensions. It’s by not—it’s by no means clear that any of those eight issues are close to any sort of a resolution, but can you talk a little bit about what trade deal or what sort of transaction we might see closed during this trip?
AYRES: Right. (Laughs.) So you know, the president has spoken publicly in his rally yesterday and then on the tarmac about a day and a half, two days ago, and then last week in the Oval Office about this India trip. And the two things that he seems focused on as his priorities for this trip are the stadium appearance, the crowd size to welcome him. He keeps talking about this. The number keeps growing. That’s perhaps a separate digression. But he also is focused on this idea of the trade deals. And as the weeks have gone by, it looks less and less certain that there’s going to be a formal deal of any size to really announce some of the elements of this negotiation that have been briefed out, largely coming from briefings to the Indian press, from Indian trade negotiators.
Some of the things that have been apparently under discussion have included lifting price caps on medical devices. This is something that the Indian government did in 2017 and it ended up being extremely detrimental to U.S. medical device manufactures, who later actually petitioned the U.S. government to remove India from the Generalized System of Preferences program. And they were successful in doing that. So that’s one element that they’ve been talking about. Another element is a reduction or removal of these retaliatory tariffs that India applies on a whole host of U.S. exports, primarily agricultural exports, in retaliation for the tariffs that the Trump administration applied on steel and aluminum imports using—and Ted can talk about this more—using the national security exception. This ended up affecting India, although at no point in my recollection were steel and aluminum imports from India ever an issue that anybody was concerned about. So that created this kind of spiral of tariffs, and retaliatory tariffs.
India’s been very concerned about losing access to the Generalized System of Preferences program, which allowed almost $6 billion in Indian goods duty-free entry into the United States. Another complication with this issue that I understand has made the trade deal negotiations more complex, which is that in the past couple weeks the Trump administration has notified the World Trade Organization that they’re making some changes to their list of countries that they consider developing countries, that could even have access to trade preference programs like this. And they’ve removed India from that list of developing countries. Again, that kind of broader approach to trade is something that Ted really works on closely.
But so it looks like there may be some kind of trade accomplishment to announce, but nothing that’ll look like a big trade deal. Perhaps they’ll be able to say there’s been progress on, again, medical devices. The president always talks about India’s high tariffs on Harley-Davidson. It’s a fact, India has very high tariffs, particularly on the largest-engine Harley-Davidsons. We’ve seen that the Indian side was willing to lower those tariffs to be responsive to that concern. So perhaps that’s something they can announce. But this definitely is not going to be a kind of all trade doors are open now kind of a discussion. And one of the priorities for the Indian side, for their services trade, is on greater access to high-skilled worker visas through our H-1B program. And for the U.S. side, that’s just not something that can be negotiated. That actually requires new laws, legislation through Congress. So that is something that I’m not even sure how they’ll actually be able to discuss.
MCMAHON: So I’m going to turn to Ted in a second to give more context on the trade front, but I wanted to ask you one more question, Alyssa, which is on the broader sort of strategic aspect of this relationship. This is now—President Trump is going to be the four president in a row, I believe, to visit India. You have this trajectory of warmer and warmer ties amid disputes over things like trade and other issues. Clearly you can point to a tightening relationship. Can you talk a little bit about how those relations have changed over time, and what, if anything, this trip might do to add to that, or to reinforce that?
AYRES: Thanks. I think it’s clear that the most successful elements of this trip, at least from what we’re seeing that’s prepped and ready to announce, are likely now to be on the strategic and defense side. There is apparently a defense procurement that’s ready to announce, a $2.6 billion Indian purchase of naval helicopters, about twenty-four of the Seahawks. Again, that speaks to this U.S. and Indian conversions of interests on maritime security, maritime domain awareness. It’s part of looking at this broader Indo-Pacific.
And frankly, it speaks directly to the way that the region has changed over time. And now there is a pretty firm consensus across parties in the United States that China’s rise and China’s territorial interest across this maritime space do a pose a challenge to freedom of navigation, to the idea of looking for an Indo-Pacific for a broader Asian region that’s not dominated by any one power. And so in these larger kind of grand strategy discussions about how to be responsive to China’s rise and the challenges that it poses, the role that India can play as a balancer is becoming pretty important.
And that doesn’t mean we see eye to eye on things. We did a taskforce here at the Council on Foreign Relations in 2015 addressing this issue, that the U.S. and India don’t always see eye to eye, even if we agree largely on the kind of strategic points. We may not see eye to eye on the ways to address it. And that kind of challenge continues. India is a very independent country. Modi is working more closely with the United States, including with the Obama administration and now the Trump administration, than previous Indian governments have.
But that doesn’t mean that they don’t continue to have their own ambitions and strategic goals that don’t always converge with U.S. goals. So there’s been some previewing in the Indian press that there will be different memorandums of understanding that could be announced on this trip as well, including on counterterrorism, the Indo-Pacific, defense ties, homeland security. We’ll have to see what actually ends up being the content of that, what ends up showing up in the joint statement to really have a good sense of what is progressing further on that front.
MCMAHON: Great. Thanks, Alyssa.
So, Ted, I wanted to follow up with you and go back a little bit more into the trade perspective, particularly on how India fits into how the Trump administration has handled trade negotiations so far. You’ve written quite a bit about how it’s been really quite a course change in the way the U.S. has approached trade. Can you talk a little bit more about any sort of pattern to look for, whether in this specific trip or just more broadly on the U.S.-India trade front?
ALDEN: Yeah. Thanks, Bob.
I mean, very much if you look at the way the administration is approaching India, it’s very much in line with the blueprint it’s used for every other trade negotiation. I mean, this is a high priority for the president. He talks about it constantly. He said recently that he thinks the trade issue is one of the big reasons he got elected, and that the American people want him to fix the unfairness of the trade system. And so the blueprint has been to make threats and impose a series of sanctions. And then use that as the tool to launch bilateral negotiations in an effort to try to change rules, find purchase commitments, do other things that will help alleviate some of the U.S. trade troubles with whatever nation has been targeted. So I mean, we saw that with the steel and aluminum tariffs initially, which resulted in, for instance, South Korea agreeing to some minor changes to its trade deal with the United States. You saw that here in North America in the new USMCA negotiations. A lot of pressure on Canada and Mexico. That finally came forward with a deal.
What’s interesting here is that that approach has really run into roadblocks when dealing with large countries. So if you look at the U.S.-China negotiations and this phase one deal that was reached last month, most of the difficult issues having to do with subsidies and forced technology transfer, structural issues in the Chinese economy, simply were not deal with. The Chinese made a bunch of purchase commitments that are now looking very doubtful. They were doubtful to begin with, but now looking particularly doubtful because of the coronavirus outbreak. Same approach to the European Union. No progress there so far. The EU has been extremely reluctant to make the sort of trade concessions the U.S. wants. And we’re seeing it now with India.
So as Alyssa mentioned, the administration removed the GSP benefits from India. It was about $6.3 billion in imports from India that came in tariff free. The United States has removed that benefit. India was also hit, as she mentioned, by the steel and aluminum tariffs. India’s not a huge exporter to the United States, but about 1 percent of U.S. steel imports and about 3-plus percent of aluminum imports. And this was supposed to be the leverage to get a big trade deal with India. And what we’re seeing is kind of consistent with the pattern, which is the leverage that these tariffs provide seems to be quite minimal. The U.S. and India it does not appear are even going to be able to do a small deal, dealing with some of the biggest irritants. Alyssa mentioned medical devices, dairy access is another big one on the list, some general lowering of tariffs.
If we see a deal, it’s going to be very minimal and even that doesn’t really look like it’s on the table. It looks like the main outcome will be some purchase commitments in the defense area and liquid natural gas exports. And the president, as he has done in these other cases, is promising that a big deal is on the horizon. This big deal is going to come. I’m going to wait and I’m going to do the big deal. But the day for these big deals always seems to recede. So I think the India case is another case of the limitations of the tariff threat plus bilateral negotiations approach to trade.
And just quickly, this is such a contrast with the recent administrations, both Republican and Democrat, who had tended to deal with these things in some kind of multilateral context, either through the WTO or through broader regional trade negotiations. This one-on-one approach is the favored approach of the Trump administration, but not a lot to show for it so far.
MCMAHON: Ted, I would imagine that Indian officials are quite aware of the pattern so far involving Trump administration trade talks and keeping that in mind as they get down to bargaining. Again, not clear whether any of that is actually going to happen on this trip, which may be more about just sort of personal bonds. And on the personal bonds front, obviously the president has sort of bonded with Shinzo Abe of Japan, to some extent even with Xi Jinping. But that hasn’t really translated into any sort of deal-making that we’ve seen, has it?
ALDEN: No. I mean, I think—you know, it’s perhaps prevented some worse—I mean, with Japan, at the end of the day, they came through with a deal that was a smaller version of the Trans-Pacific Partnership agreement that the Trump administration pulled out of. So I don’t want to say the personal relations are inconsequential. Alyssa can talk more about the connection between Modi and Trump. But it certainly hasn’t produced large, tangible results. I mean, I think in the case of India you can—you can even make the argument that the administration’s behaviors have pushed India in the other direction. I mean, India has always had its own reasons to implement protectionist policies of one sort or another. It’s always been a particularly difficult actor in WTO negotiations, for instance, which I have watched for many years.
But if you look recently, I mean, India has done some things that were somewhat outrageous, even by Indian standards. I mean, raising tariffs on cellphones and other information technology products—India made a very clear commitment back in the 1990s as part of the post-Uruguay round information technology agreement that it would have zero tariffs on those products. So it’s now raised tariffs on those products above the zero-tariff level. It’s WTO litigation launched by the Europeans, and others have joined in—Japan, and Singapore, and others. The Indians pulled out of the regional negotiations known as RCEP, the Regional Comprehensive Economic Partnership, that was sort of broadly a China-led initiative in that region, saying it doesn’t want to deal with Chinese competition in manufactured goods.
So there are real elements of a kind of India first trade policy that the prime minister is carrying out, that I think in many ways emulates what the United States is doing. So I think in some ways you could argue that the U.S. behavior on the trade front has actually pushed India in exactly the opposite direction from where we would like to see it go.
AYRES: Yeah, I agree with Ted on that. I almost—like the counterfactual, if we were modeling a more open approach the way we used to, would the Indian government have gone down this path, increasing tariffs and this kind of protectionist approach? Because from 1991 forward, remember, India had been on this opening. It had been dismantling the old forms of protectionism and becoming a much more open economy. And it looks like now things are going backwards on that.
MCMAHON: Well, it is interesting, just a sort of small point on that front. Bloomberg reported, I don’t know, a week or so ago, that the United States is considering trying to find some way to raise its tariffs above what they call bound rates in the WTO, which are the legal commitments that countries make in the WTO that the tariffs on products are going to be no higher than a certain market. And U.S. bound tariff rates are very low. India’s bound tariff rates are extremely high, averaging close to 50 percent. But as Alyssa mentioned, India’s actually been bringing down its tariffs voluntarily, if you want to call it. Its actual applied tariffs are well below its WTO commitment levels. But under Modi we begin to see those creep back up.
And I think that’s very much annoyed the United States. Trump is very annoyed that a country like India has the flexibility under WTO to raise tariffs if it wishes to, without violating its WTO obligations, whereas the U.S., because we’ve bound our rates at very lower levels, is quite constrained on that front. The administration is making noises about wanting to break out of that constraint, which would be another blow, of course, to the WTO system.
MCMAHON: All right. Well, I think we’ve got an excellent framing now for the—for opening up this call. At this time, I’d like to invite members to join this conversation with their questions, and a reminder that this is an on the record call. And please limit yourself to one question, and keep it concise, so we can get as many of these questions in as we go there. And as you’re getting ready, and operator as you’re sort of checking the queue, I’d like to just ask one more question for Alyssa, and then we’ll see what kind of questions we have.
So, Alyssa, I wanted to mention that this trip is happening at a time of rising heat domestically for Narendra Modi. It does allow him to change the topic, though, and deal in some stagecraft, as you sketched out, with all these different sort of exhibits going on, shall we say, as President Trump arrives. Can you talk a little bit about what the domestic scene is like in India at this moment, and how such a trip might help Modi?
AYRES: Yeah. I don’t know how much the trip will help him. I do think there’s a thirty-six-hour window of attention and focus to ties with the United States. But it’s definitely the case that since the reelection of the Modi government in May—the Modi government has now embarked on a cultural, religious nationalist path with a series of policy changes, to the extent that this government now looks very different than it looked during the first five years—its first five-year term, where it was much more focused on economic development, economic growth, job creation, growing the manufacturing sector has a very high priority, cleaning up the streets, building toilets. It was a much more kind of broad-based development focus.
We now have seen from August 5th the abrogation of autonomy in Kashmir, which was accompanied by a very significant crackdown on people in Kashmir, some of whom, political leaders, are still under detention, house arrest—put under preventive detention now. But this has gone on more than six months, along with a communications blockade that has made it very difficult, if not impossible in some cases, for Kashmiris to reach to their loved ones. It’s been a huge issue. And of course, people have called attention to this around the world. In December the Modi government pushed through parliament a new bill that they describe as a humanitarian gesture to allow fast-track citizenship for persecuted religious minorities from the three countries of Afghanistan, Bangladesh, and Pakistan, the ability to naturalize, because an Indian citizen, must faster.
The religions that are listed in this law are religions of the region, except for Islam. So for many Indians, not just Indian Muslims but many Indians from all religious backgrounds—for many people this is a real challenge to the whole idea of secularism that’s enshrined in the Indian constitution, because the act—this Citizenship Amendment Act itself represents the first time that there’s ever been a religious test for access to citizenship. So from December 15th forward, there’s actually been protests across much of India, largely in the big cities. But these are still going on. I mean, there have been big protests in Chennai just the past couple days.
I would also note that in the Indian northeast—many people in India’s northeast have objected to the Citizenship Act Amendment not solely on the basis of the secularism question, but because that region is, in fact, very concerned about changing the ethnic balance of their region. And this is a historical issues that goes back to partition, and then the liberation and birth of Bangladesh in 1971. So there’s been a lot of protests in the northeast.
And in fact, the first foreign policy fallout of this Citizenship Amendment was the fact that Japan’s prime minister had to cancel his visit to India, which was supposed to take place right in the middle of December. And he and Mr. Modi were planned to go up to Assam together and talk about overland connectivity and the Indo-Pacific, and infrastructure development—which is an important area of bilateral cooperation between India and Japan. And there were so many protests in the streets in the northeast that they ended having to reschedule this visit. Dates still haven’t been set for that, as far as I know.
So Mr. Modi has quite substantial democratic protests happening throughout the country. And this is something that I think people are watching closely. And many people in the United States have been concerned about, have expressed concern about it. The president hasn’t. He’s been silent on all of these issues. The president also doesn’t talk about the democracy issues much at all anyway. But we have heard from the State Department, which continues to express concern about the detentions in Kashmir, and the access to communication is a challenge, and hoping for a return to normalcy.
There’s a small congressional delegation in India right now, Representatives Ami Bera and George Holding. They did a roundtable with press I believe it was just yesterday. They spoke about the kinds of concerns they’re hearing about from their constituents in the United States, and the concerns that many Americans feel about Indian democracy, and what it means that are there are people who are detained for months on end and, you know, about the ability to have—upholding that important value of secularism that has been part—such an important part of the Indian constitution.
So I think—I think there’s thirty-six hours where the president is not going to raise these issues, certainly not publicly. I don’t know what he’ll raise behind closed doors, but it does not appear to have been a set of issues that he’s focused on very much. But I think that for Mr. Modi, this is a very real aspect of the political environment now. And it’s hard to—hard to not go back and have to pay attention to it, because it’s continuing across the entire country.
MCMAHON: All right. Thank you. Operator open the call to questions, please.
OPERATOR: At this time, we will open the floor for questions.
(Gives queuing instructions.)
Our first question comes from Eric—sorry—Frank Wisner with Squire Patton Boggs.
Q: (Off mic)—and all of—and both of our CFR guests, briefers, today, thank you for an excellent brief. What is disturbing about it is how narrow the focus of a Trump visit will be. Past visits have had a wider aperture in looking at broader security and political questions. Now we’ve seen focused on defense sales and trade issues. And the relationship is more demanding than that. Do you believe that there will be time and space and an attitude to discuss the upcoming Afghan peace matter, how we pursue our relations and how India pursues her relations with China, what possibilities there are for collaboration for Asian-Pacific security? After all, we, India, China, Australia, and Japan have been active in military exercises. In short, is there any foreign policy reach that is likely to surface during the visit that would give it a little bit more heft than its current frame?
AYRES: Can I take that one?
MCMAHON: Thank you. Alyssa, that was the first mention of Afghanistan.
AYRES: Yeah. Yeah. Thanks, Frank. I saw your name on the list. Thanks so much for taking the time to join this.
I agree. I have been a little bit worried—first of all, a lot of what we’re hearing, almost all of what we’re hearing about the trip and the agenda for the trip, is coming from the Indian Ministry of External Affairs, on the record briefings, and briefings that foreign secretary and others in the MEA are providing to the Indian press. So we don’t have an on-the-record or even background to point to so far on the USG side where people have been able to ask those questions.
We did see there was a report overnight that it looks like counterterrorism, discussion on the Indo-Pacific, homeland security, and defense ties will be a part of the discussions. So I hope that signals that there’s an opportunity to talk about where we are with this agreement with the Taliban, what that will mean for regional security. We know very well that the Indian government has a lot of concerns about this, and about what that might mean for the ability of terrorists to more fully set their sights on India. They’ve been concerned about this for a long time. I do think that discussion and a comparing of views of China and what its rise suggests for U.S. and India interests in the Indo-Pacific—I can’t help thing that’s going to be part of the strategic discussion there.
The Indo-Pacific as a framework is something that the administration has embraced, even if the president himself doesn’t speak about this very often. But his secretary of state, and his secretary of defense, and in fact the vice president have talked about the free and open Indo-Pacific. It’s baked into the National Security Strategy, the National Defense Strategy. So I presume that people who are working on the agenda items are going to include that because it’s been a really big piece of the way the administration approaches the region.
But I’m looking forward to seeing the joint statement, how it comes out, what kind of language and priorities make it in there. By the way, there was also a report yesterday that it may be possible for Westinghouse and India’s nuclear power corporation to sign a fresh memorandum of understanding for six nuclear power reactors in India. I’m going to hold my breath on this until I see it, but if they can pull this off that actually will make a reviving of the commercialization aspect of the Civil Nuclear Agreement. And this has, as you know so well, been languishing, really, since 2008. So that would be very welcome progress.
MCMAHON: Thanks for that question, Ambassador Wisner.
Operator, do we have another question, please?
OPERATOR: Our next question comes from Eric J. Pawlowski (sp) with Shell Oil Company.
Q: Hi, guys. Thank you for doing this.
I wondered if you might comment on the domestic political implications of the trip on the U.S. side. Are there any? Are they material? Or are they really lost in the noise?
MCMAHON: Well, Alyssa or Ted, do you want to take a crack at that?
ALDEN: I’ll let Alyssa go first. I don’t think there are significant implications. Maybe some with the Indian community here. But I’ll defer to Alyssa on that.
AYRES: So there is a school of thought that believes that the president—(laughs)—may be interested in addressing a crowd of more than a hundred thousand people at this stadium to try to encourage more votes for his domestic prospects. Obviously, I don’t—I can’t read his mind, so I don’t know what’s going through his head. He talks a lot about the crowd size as something that he’s really looking forward to on this trip. But it’s a little bit harder for me to see how that translates into domestic political prospects. I mean, I think that voters in the United States make up their own minds have their own engagements. And I’m not really sure that a speech at a rally in India makes a difference one way or another about that. So for me, I’m very skeptical about that as a motivating factor, and/or as an element of impact. I mean, Ted, I don’t know if you have been looking at this question at all.
ALDEN: I mean, if you—I mean, just more generally, if you watch from the debates on the Democratic side so far, I mean, foreign policy has just not figured at all in this—the election process to date. And I find that very frustrating. I think there are huge issues on the table about the U.S. role in the world, raised by this administration, and something that the Democrats ought to be addressing in the debates, or other fora. But it’s not been coming forward at all. And I think in terms of—in terms of the president’s campaign, I think, you know, what we’re going to see is a rerun of 2016 in many ways. I think the trade issue will be important, though he’s going to be running this time more on accomplishments than just on criticism. The Democrats have so far not really picked this up, to be particularly critical of what President Trump has done on trade. So I’m not sure he’s going to get a lot of pushback on that.
And then obviously the immigration issue will play very substantially in this election. And that’s an interesting one with respect to the Indians because, you know, President Trump’s sort of general line on immigration is, oh, yes, we want a merit-based system. We like high-skilled immigrants. Well, a considerable percentage of the high-skilled immigrants coming to the United States are from India. And the administration’s policies has actually—are actually making it considerably more difficult for Indians to come, and live, and work in the United States. This is an issue that I think will be raised in this trip from the Indian side. So that issue I can imagine playing out some in the election, but mostly not. I don’t think there are significant domestic political implications to this trip.
MCMAHON: Thank you. Operator, can we have another question, please?
OPERATOR: Our next question comes from Farooq Kathwari from Ethan Allen.
Q: Yes. Alyssa, you covered the issues very, very well. And also Frank Wisner talked about Afghanistan and the Taliban. My question really is there’s a tremendously important peace in South Asia. Of course, Kashmir is tremendously important to me, in terms of having peace there. So my question is, do you think there is any discussions going to take place about peace, and the relationship between India, Pakistan, Bangladesh—all the neighbors.
AYRES: Hi, Farooq. Thanks so much for joining.
We have seen that the president likes to raise the issue of Kashmir. He did it earlier when Prime Minister Imran Khan came to the White House in July. He raised this in September when he had his meetings with Imran Khan on the margins of the U.N. General Assembly. But the context in which the president seems to like to raise this issue—and you know this so well—the context in which he seems to like to raise this is one in which he offers himself as a possible mediator if both sides want it. I’m extremely doubtful that India would be interested in having a third party play a role in this. But I do think that India will ask for American help and attention to the counterterrorism challenge from Pakistan.
I don’t think that the Indian government, and I don’t think that Prime Minister Modi is likely to want to listen to criticism of the way the Indian government has handled the abrogation of Article 370 and the detention of so many people in Kashmir, and the communications blockade. I think they’re likely to—as in all discussions on this topic—identify that set of issues as their sovereign concern and not take comment from another country. So I don’t think that this is going to be a meeting that’s likely to produce a new blueprint, for example, of a way to solve tensions between India and Pakistan, unfortunately. I just don’t think that that is something on offer.
But, you know, when the president talks about this, will he raise this? I think he probably in some manner or another will raise this. He does seem to have a bee in his bonnet about the fact that President Obama received a Nobel Peace Prize. And in one of the interactions with the press, somebody asked President Trump, if he could solve Kashmir would he also deserve a Nobel Peace Prize? And, you know, he’s talked and laughed about this, but it does seem to be an issue that he returns to every once in a while. So I can imagine him raising this again as something that he’d be interested in pursuing, because he sees himself as a dealmaker, ready to help if asked.
MCMAHON: And, Alyssa, do we know if there are going to be some media opportunities, say in New Delhi, where you have both leaders sitting down and the press able to ask questions? I would imagine Indian press will be quite outspoken in those sessions.
AYRES: Yeah, I don’t know what they’re planning for the press schedule. On this front I just don’t know. I would imagine they would, but I don’t know if it’ll be two questions here, two questions there, or if there’ll be a much broader opportunity.
MCMAHON: OK. Well, thanks for that question.
And this is a reminder, this is a CFR on-the-record conference call on President Trump’s trip to India. And we’re speaking with CFR senior fellows Alyssa Ayers and Ted Alden.
Operator, do we have another question in the queue, please?
OPERATOR: Our next question comes from Morgan Chalfant with The Hill.
Q: Hi. Thanks for doing this.
I wanted to—you mentioned earlier the expected procurement announcement, the helicopter buy. I wanted to know if you could talk about how significant that is? Is that something that you’d expect to generally be highlighted at presidential visits like this? Or do you think it’s more kind of an effort to—by India—to highlight it, you know, because Trump likes to highlight these big deals? If you could just talk a little bit more about that.
AYRES: Hi. Thanks for the question.
So in my recollection, big defense procurements like this are always highlighted at presidential and ministerial level engagements and visits, because they’re important. And the defense trade relationship with India is actually particularly important because it’s so different now from the way things were fifteen-twenty years ago. I mean, it used to be that India’s sole defense partner was Russia. And India has really expanded the partners—it’s diversified its partners over the course of the last fifteen years or so. And the United States is an increasingly important partner for India. So certainly they’re going to have some kind of announcement. Over the last six months the general framework has been that India has now exceeded more than $18 billion in defense procurements from the United States. So if both of these deals that have been so far previewed in the press—if both these come through, they’ll be able to really bump that number up. And it’s important.
The number also speaks to the fact that we are partnering together our defense coordination, our interoperability is increasing. We may very well be able to announce conclusion of another defense foundational agreement that will further strengthen the way our militaries are able to communicate with each other and work together. Remember, we’ve got a vastly expanded defense exercises relationship with India now. India, quote/unquote “exercises” more with the United States than with any other partner. And the United States exercises more with India than with any other NATO partner.* So that is kind of a big deal. And the defense procurement will highlight that aspect of the relationship, despite the ups and downs in the domestic challenges and the ups and downs on the trade issue. That element of the relationship, which is really built on a convergence of strategic interests, continues to grow and expand.
MCMAHON: Thanks for that question.
Operator, do you have another question, please?
OPERATOR: Our next question comes from Ponchitta Pierce with journalist.
Q: Thank you. You referenced earlier President Khan, Pakistan. And, as you said, he was here for a short kind of under-the-radar visit. But I was curious in particular what the reaction of the president was and official Pakistan to this visit. Not necessarily were they caught by surprise, but just in general the reaction.
MCMAHON: Alyssa, you want to field that one also?
AYRES: Thanks. Yeah. I haven’t noted an immense reaction one way or another. I think what we need to actually wait for is once there are some announcements that happen after the president’s visit to India. Because what people are working on right now, frankly, is a lot of guesswork.
MCMAHON: Got it. Thank you.
Operator, do we have another question, please?
OPERATOR: (Gives queuing instructions.)
We’ll take our next question from Raj Pahwa with University of Kansas.
Q: Thank you both for the wonderful presentation and Q&A session.
My question is: What, if any, analogies or distinctions might you draw between the Trump administration’s treatment or approach to what’s going on in Kashmir, on the one hand, and the Trump administration peace plan for Israel on the other hand? Are we generally looking at a paradigm shift, where what happened in the Levant in 1948 and after partition in 1947 is now basically time to move on and focus on economic development and real estate, and not your political aspirations? Or is there something else going on? Just sort of what your thoughts are on that sort of India-U.S.-Israel mix.
MCMAHON: Alyssa, you want to take that?
AYRES: Yeah. There isn’t a Trump peace plan for India-Pakistan, right? So I’m not sure—I mean, is your question more focused on the idea that the United States, and Israel, and India have a kind of—at the moment—sort of right-wing nationalist leaders? Is that what you’re looking at? I mean, I don’t think there’s a way to compare and analogize here, because we’re talking about two very different things.
MCMAHON: Did you want to rephrase the question or clarify? Hello? Is the questioner still on the line?
OPERATOR: One moment.
MCMAHON: OK, I’m not sure if they—OK.
OK, well, we can—we can move on to the—to the next question, Operator, in the queue, if there is one.
OPERATOR: Our next question come from Kim Dozier with Time.
Q: Hi, folks. Thanks for doing this.
I have a question about the nexus between Pakistan and the Afghan peace talks and Kashmir, and a second about what the Muslim world will think if Washington doesn’t do anything to sort out the situation of Kashmir. The first one is, I—the common thinking is that India seized the Kashmiri territory at the time that it did because it thought that Washington would have to pivot to Pakistan to make the Afghan peace deal stick. If Washington does nothing on the Kashmir issue, do you think Pakistan will retaliate vis-à-vis the Afghan peace plan and its long-term chances for success? And then, of course, the second question about what will the larger Muslim world think if D.C. doesn’t stand up for the Muslims in Kashmir.
AYRES: So I’m assuming—
MCMAHON: So, Alyssa, you touched on that—on that before a little bit, but do you want to go a little bit further into how the administration has treated that?
AYRES: Yeah. Well, you know, I’m not really sure what you mean by seizing Kashmir. I mean, Jammu and Kashmir acceded to India in 1947. And this is a much larger conversation, and we can’t even begin to go into it on this call.
Q: That’s my imprecision, my use of language. Their action in Kashmir that Pakistan has objected to.
Q: And so have other Muslims, including Saudi Arabia.
AYRES: Yeah. Look, so on this issue I think what lies out there that really is not part of an international discussion—it has been a concern for Pakistan—but the question of how India treats state boundaries within territories that are administered already by India—and of course, India also legally claims what Pakistan is administering as Azad Kashmir and Gilgit-Baltistan—but that is, again—that is way beyond the scope of this conversation.
But I think the question that really is quite important and that in some ways is the more significant one is the issue of how people are treated. And so you have seen, as I mentioned, concern expressed by members of Congress, concern expressed by the State Department about the ongoing detention of people in Kashmir, including political leaders—former chief ministers of the state, chief ministers who have served in alliance with the Bharatiya Janata Party. So that has been something that you’ve seen expressions of concern about. The State Department continues to call for a return to normalcy, elections a the soonest possible moment, and a full listing of the communications restrictions. Some of them have been lifted, but not fully.
But you know, Pakistan has focused on Kashmir for years and years. Trump’s visit is not going to make a change in the fact that Pakistan continues to have a focus on Kashmir, even though it actually should also be focusing on other aspects of its own country.
So you know, my view on this is that India faces a real challenge of its own to afford all of its citizens—the citizens who live in Kashmir and everywhere else in the country—access to all of the rights that they enjoy that are part of the constitution of India. And I don’t believe that Pakistan’s territorial claim is something that should be opened up because Jammu and Kashmir acceded to India. It’s a very, very complicated territorial set of issues. In fact—anyway, very complicated. But there is a real concern about the treatment of citizens who live in India, including in Indian Kashmir—all parts of India.
And as I said, I don’t anticipate that President Trump will raise this. But we have consistently seen the State Department raise these issues and we did just see two members of Congress express their concerns in India yesterday.
MCMAHON: Thank you. Operator, can we have another question, please?
OPERATOR: Our next question comes from Shirin R. Tahir-Kheli with Johns Hopkins School of Advanced International Studies.
Q: Yes. Hi, and thank you for this very interesting conversation.
I just wondered if, you know, going back to that Nobel Prize issue, whether there’s a—there’s some thinking if, indeed, this peace talk with—leads to something in Doha on the 29th as scheduled, where there’s a thought that maybe being in proximity to Doha already there is a presidential trip planned to sign something big, a la Trump.
MCMAHON: You’re talking about in relation to the Afghanistan talks?
Q: Yeah. Yeah. Yeah.
AYRES: Hi, Shirin. Thank you for that.
I honestly don’t know. I don’t know if these are two separate channels that have happened to now converge in terms of timing or if this was planned. I mean, I just simply don’t know. We have to wait and see what happens, of course, with the trip to India, and how the agreement with the Taliban holds and the reduction of violence and how things move forward. So I just really—I would just be speculating, as so many of us are.
MCMAHON: We should confirm that reduction-of-violence agreement is supposed to take effect starting, I believe, tomorrow U.S. time and last for seven days?
MCMAHON: OK. Operator, please, another question.
OPERATOR: Our next question comes from Edward F. Cox with New York Republican State Committee.
Q: Yeah. Obviously, the China backdrop is important to this visit. Could we have a little bit more of the nuanced details of the India-China relationship at this point—their border issues, maybe their common views with respect to the Muslim world, et cetera?
MCMAHON: I’ll start again with Alyssa and then Ted if you wanted to add anything.
AYRES: Hi. Thanks for the question.
The China backdrop is actually quite important for the broader what are referred to as the convergence of interests, particularly on the strategic side. India and China have a quite tense security relationship. You referred to the border issues. They fought a border war in 1962. That border remains undefined. They’ve had, I think, twenty-one, maybe twenty-two rounds of negotiations about the border, still have not resolved where it actually is. And as a result of not having a defined border, they continue to have incursions across this line of actual control. Three summers—two summers ago, summer of 2017, there was a standoff between Indian and Chinese troops, actually not on the India-China border; on the China-Bhutan border, but India sent troops up to defend Bhutan’s territory because they were concerned about encroachment into their own strategic territory. So there is that.
And on the economic front India and China also have in some ways a very tense relationship that mirrors, although at a much lower volume, the U.S.-China trade relationship. India runs a quite substantial trade deficit with China. China is their largest trade partner in goods alone, although the U.S. is now very close based on just what has happened in the past couple years. But the composition of trade India is not very happy with. They send kind of raw materials—iron ore, chemicals—and you know, what comes in as imports are value-added goods. So they’re unhappy about that and really have been seeking much broader market access from China for their own goods. So that’s also a source of tension and complaint.
India has been concerned for almost two decades about what they see as China’s effort to deepen its strategic and economic ties with all of India’s neighbors as a means of encircling India and tying India down, preventing India from being able to rise and attain its own ambitions of primacy in the Indian Ocean region. And of course, the Belt and Road Initiative has only further exacerbated that concern as China has continued to ramp up its infrastructure investments in countries. It’s got this, you know, all-weather friendship already with Pakistan. It’s deepened its relationship with Sri Lanka. It is investing in a lot of infrastructure and powerplant development in Bangladesh. Nepal is now—Xi Jinping visited Nepal, the first Chinese presidential visit I think in twenty years—I’d have to go back and double-check that. But you can see there’s a lot of concern from strategic planners in India about what China’s ambitions are and its own desire to have a kind of outsized shadow—outsized influence in the region and what that means for India.
So there are a lot of shared concerns that New Delhi has with Washington, and in many ways that’s one element that has helped pull those countries together over the course of the last fifteen years or so given these changed geopolitics in the region. So I expect that to be an important element of conversation, certainly, in the big bilateral meeting.
MCMAHON: Ted, anything to add on India-China?
ALDEN: Yes. Just to reinforce Alyssa’s point on India-China trade, I mean, if you look at the reasons that India walked away from the RCEP, it was not dissimilar to U.S. concerns about Chinese import competition. The Indians were looking for robust mechanisms regarding rule of origin to make sure that, you know, goods weren’t transshipped via China and other things to come into India. That’s been a big concern for the Trump administration in its trade negotiations. It was looking for mechanisms to protect Indian manufacturers from a surge in imports from China, again something the Chinese weren’t interested in negotiating on Indian terms on, and India generally not wanting to lower its tariffs anywhere near as steeply as other participants in the RCEP negotiations were willing to do.
Let me make just one more general comment, though, because this conversation is fascinating. You know, we have a president who is focused on the minutiae of trade negotiations as somehow a state-visit-level issue. And as this conversation I think really lays out, these are the things that should be on the table, these broader questions about U.S.-India cooperation, democracy in India, India’s role in the region, India’s relationships with its major neighbors. Those are the things that historically would have been the substance of visits like this. But instead, because of President Trump’s particular infatuation with the trade issue, with the trade balance, with selling U.S. products, that becomes the focus of a visit like this, which is really not appropriate. I actually think this conversation has been much more the sort of thing you want—would have wanted to see the administration address in advance of the visit: what are the big strategic priorities for the United States with respect to India, which is, you know, one of our two or three most important partners in the world. And it’s fascinating that that just isn’t even being discussed by the administration.
MCMAHON: Thanks. And I think that’s actually a good point to end up this hour. We are out of our hour, or just about, on this call. I want to thank all the members who dialed in and all the—all the good questions, and really to thank Senior Fellows Alyssa Ayres and Ted Alden for helping us navigate this trip. Again, it’s going to be a bit of a whirlwind, but a lot of issues could come up, and a lot of issues that could have a great deal of consequence beyond the region.
So this concludes this Council on Foreign Relations on-the-record conference call. Please keep a lookout for both the audio and then after that the transcript of this call, as well, being posted on CFR.org. Thanks again for joining this conference call.
AYRES: Thanks, Bob.
ALDEN: Thanks, Bob.
*Correction: Alyssa Ayres clarifies that the United States exercises more with India than any other non-NATO partner.