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Sanctions, the economy and Kashmir: Three points on the agenda of India's Prime Minister during his visit to the United States
In spite of the Indian media fanfare marking the current visit of India's Prime Minister, Atal Bihari Vajpayee, to the United States, observers see no reason for jubilation. There are even doubts with respect to the significance of the visit at this particular time when President Clinton will soon be packing up to leave the White House.
Prime Minister Vajpayee spent nine days in Washington attending banquets and events of the United Nations' new millennium celebrations. He was keen not to go to any place where he might meet Pakistan's ruler General Musharraf.
Vajpayee devoted his time to making strongly worded speeches: the kind that he would not be delivering in India. He described Pakistan as a country of the Middle Ages and the center of terrorism in the world. These statements do not in any way serve India's wish to improve relations with Pakistan and solve their outstanding problems as it claims. Vajpayee's aim behind these hot statements was to capitalize on the current Western interest in the issue of terrorism, particularly "Islamic" terrorism.
Lifting the Sanctions on India
Vajpayee is bound to fail if he and his aides think that focusing on "terrorism" and reiterating India's readiness to participate in Western efforts against terrorism will be enough to entice the American Administration to reconsider its position regarding the sanctions imposed on India. Clinton's Administration had made it clear that there was nothing new to prompt any such reconsideration. It even rejected a resolution passed by the Congress in this regard.
Vajpayee's visit became an official visit as he moved on Thursday, 14 September, from New York to Washington where he addressed a joint session of the US Congress and Senate on Friday, 15 September. He is due to meet President Clinton for discussions on Saturday, 16 September .
Solving Economic Problems between the Two Countries
The Indian Prime Minister focused on solving the economic problems between the two countries, attempting in particular to increase the volume of American investments in India. The two sides are not keen to deal with outstanding (political) issues because their positions in this regard are already known and remain unchanged. Hence, India's choice to approach the United States economically. This road has in fact been blocked to India since 1974 when Indira Gandhi authorized the atomic bomb explosion test that led the United States to impose economic sanctions on India. The sanctions were intensified following the Indian nuclear tests in summer of 1998. But they were reduced slightly in the wake of President Clinton's visit to India in March 2000. During this visit Vajpayee promised Clinton to build an Indian public opinion consensus to sign the NPT by September 2000. So far, Vajpayee has not been able to do this.
The US sanctions ban any form of high-level technological cooperation between the two countries to the extent that Indian experts and officials in the field of biotechnology are not allowed to visit the United States to participate in scientific conferences and symposia. This is harmful to India, and it is also not allowed to import any biological equipment that the United States estimates to be useful to the Indian nuclear programme.
The American position is clear: sanctions will not be lifted unless India signs the NPT unconditionally. The Indian position is that India will sign the treaty after building the relevant national consensus. But at the same time, the Indian government has undertaken not to conduct any more nuclear tests and not to block the enforcement of the NPT.
Economic Relations to Ease Sanctions
Given the obvious discord between the two positions, India has decided to opt for an economic approach. It sees that sanctions may be removed if there are strong economic ties between the two countries. To encourage American companies to invest in it, India has introduced fundamental changes in its foreign investment laws. The changes affect basic policies in a way nobody could have dreamed of, for example, opening the door for investment in the energy sector and allowing foreign insurance companies to operate in India. Shortly before the current visit of Prime Minister Vajpayee to the United States, India opened up the telecommunications sector to foreign investment. This was in response to pressure from American companies willing to invest in India, but had been previously reluctant to do so on account of restrictions in the telecommunications sector. The economic reforms have been described by the US Assistant Secretary of State for South Asian Affairs, Karl Inderfurth, as "music to American ears."
The degree of the reluctance of American companies to invest in India may be realized when one knows that in the last ten years India had approved American investment proposals amounting to $14 billion, while the actual American investments did not exceed $2.5 billion throughout that period. Some leading American companies have had considerable difficulties arising from the widespread red tape and corruption in India. This has had a negative effect on other potential corporate investors. India is now seeking to increase the volume of actual American investments to $4 billion.
Prime Minister Vajpayee is hoping to persuade President Clinton in their official talks on Saturday, 16 September, to solve some outstanding economic problems including the removal of restrictions on the exportation of clothes, dual taxation, civil aviation, energy and telecommunications. In spite of the obstacles posed by America, the United States remains India's largest economic partner. In 1999, trade exchange between the two countries amounted to $ 9,083 million. The balance tipped largely in favour of India whose imports from the United States stood at $3,707 million.
Kashmir on the Agenda
The real but undeclared aim of the visit is probably to get the American Administration to put pressure on Pakistan to make the latter refrain from supporting the armed movement in Indian Kashmir. India has been greatly encouraged by certain American signals in this matter. However, America is not expected to place overt pressures on Islamabad because, unlike India, it sees the problem of Kashmir as an outstanding problem between India and Pakistan that has to be solved peacefully by the two countries.
There have been objections in India to the timing and validity of Vajpayee's current visit: President Clinton's term in office is nearing its end. America is now busy with the feverish run-up to the new presidential elections. It is not therefore beneficial to talk to a President who will be leaving the White House within a few months. But the reaction of the Indian government to these objections was that talks would take place between institutions rather than individuals
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