Pakistan Observer

Hillary to India: Take out your wallets!

Geopolitical notes from India

M D Nalapat

Friday, July 22, 2011 - Bill Clinton is one of the biggest fund-raisers in the world. A check into the donors for his foundation would show names from across the world, including several not known to be interested in the numerous good causes that Clinton claims to champion. When she ran for office as Senator from New York and later as the Democratic Party challenger to Barack Obama in the last presidential elections, Hillary Clinton raised large sums of money, although these dried up when it became clear that she would lose to Obama. The Clintons know that it is economic issues that resonate strongest with the Democratic party faithful, and it is to their credit that they presided over a period of growing prosperity for the US population. Not merely that, unlike Ronald Reagan and George W Bush, who ran up huge budget deficits and sharply increased the debt of the average taxpayer, President Clinton was able to convert the Republican deficit into a Democratic surplus. Of course, in the process, he allowed changes in regulations that began the wave of speculative transactions that almost led to the collapse of the international economy in 2008.

Although newspaper headlines in India claim that Hillary Clinton came to Delhi and Chennai in India three days before “to strengthen the strategic relationship between the US and India”, the reality is that she came looking for a handout, and the larger the better. A gasping US economy badly needs cash from wherever it can find it, and US corporates look to their government to ensure that a steady and growing flow of Indian orders takes place. Secretary Clinton made no secret of this intention, although the hunger for cash was couched behind soothing words about India’s importance. Exactly the sort of idle compliment that sends officials, mediapersons and officials in India swooning in delight. Of course, the visit left Corporate India unimpressed. Clinton refused to give any solace on the issue of numerous obstacles being placed by the protectionist Obama administration on the employment of Indian software and other professionals. She declined to announce a single measure that would assist Indian exporters in entering the US market.

However, while she gave zero concessions to Indian commercial interests, Hillary made extensive demands on behalf of US business. One of the most obnoxious was her public demand that Manmohan Singh get passed in 2011 itself a law that would - in effect - allow US nuclear suppliers a free pass even if malfunctions in their equipment killed tens of thousands, the way the Bhopal factory of Union Carbide did a quarter-century ago. Although the house-trained India media refused to react strongly to such effrontery, presumably even two individuals as innocent of politics as Manmohan Singh and Sonia Gandhi are aware that there would be a huge public outcry at such an indemnity given to foreign nuclear equipment suppliers.

What Clinton wanted was that foreign suppliers get all the financial benefits of selling even untested reactors, while placing on the shoulders of the Indian taxpayer all the risks of a nuclear incident or accident. Watching her in action at Tuesday’s press conference with S M Krishna, observers may have been forgiven for thinking that they were back in the 1930s,when India was ruled by a colonial power and had to suffer constant dictation from that power, usually against its own interests.

This columnist refuses to believe that Hillary Clinton is a liar. Hence he attributes to her lack of knowledge of the nuances of the nuclear issue her astounding statement that the 2008 Nuclear Supplier Group’s waiver to India was fully consistent with the recent NSG decision to restrict sales of uranium enrichment technology “to those countries that have signed the NPT”, a group to which India has refused to belong from the 1960s. Although President Bush worked out a marginally acceptable deal with India, ever since Barack Obama took over as the US President in 2009, he and his administration have consistently diluted the deal and sought to render it a nullity. Yes, the US is more than willing to get $20 billion of nuclear reactor orders from India, even though it has not altered its reactor designs for three decades. However, this will be given to India on exactly the same conditions as they would be sold to countries such as Qatar or South Africa. Prime Minister Singh has been shown to have been completely credulous when he accepted US claims that India would be treated on a higher footing than the non-weapon states that have signed the NPT. Instead, Obama ( assisted by Clinton and by other departments such as Commerce) has followed the line that has been favoured by China, which is to deny India any technology and set up only turnkey power plants in India.

Even as Manmohan Singh and Sonia Gandhi have sought to fashion policies in India that are responsive to US commands, the Obama administration has refused to permit substantive technology cooperation with India in fields such as Space, Nuclear Science and even Defense. All that Team Obama seeks is cash from purchases of items, sales made on the same restrictive conditions as apply to other countries. The fact is that the size of India and its dynamic population mandates that the country be treated on a footing different from all except other major powers. Apart from soothing and flattering words - of which there has been a profusion from Obama on down to low-level officials - thus far there has been very little change in the harsh restrictions that have been active against India since 1974. Despite this, last year India has sourced more than $8 billion from the US in the field of Defense puchases alone, including huge transport aircraft more suited to long-range operations than to border incidents. As for nuclear trade, the US has succeeded in ensuring that both France and Russia join it in demanding that their companies be absolved of any financial responsibility for accidents, including those caused by faulty design. The fact that France and Russia have joined hands with the US has been a shock to South Block, as it is in contrast to the period after the 1998 nuclear blasts, when both Paris and Moscow refused to join Washington, Canberra, Berlin and Ottawa in inflicting severe punishment on India for its temerity in going ahead with a technology that is intended only for “civilised” nations.

Although Manmohan Singh would like to oblige the US in any way he can, the PM is constrained by the fact that the many restrictive policies and the corruption of his administration has slowed down the economy. This has made it difficult for the government to find the cash needed to make huge nuclear orders. Had this cash been there, the government would have gone ahead with the orders, despite the humiliating conditions. After all, it is an article of faith in official Delhi that the US is always right, even if what it seeks is wrong for India. What terrorists could not - and cannot - do has been achieved by disastrous monetary and other policies. India’s economy is slowing down and this process will continue until wiser policies get formulated and implemented.

—The writer is Vice-Chair, Manipal Advanced Research Group, UNESCO Peace Chair & Professor of Geopolitics, Manipal University, Haryana State, India.
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