Recent trade tensions between the US and India won’t impact ties between the two nations, and their partnership is “already beginning to reach new heights,” Secretary of State Mike Pompeo said during a visit to New Delhi Wednesday, less than two weeks after India increased tariffs on some US exports.
Delhi’s decision in mid-June was in response the Trump administration’s move to end India’s participation in a preferential trade program. The Indian government did not specify the value of the goods targeted at the time, but had previously told the World Trade Organization that they were worth around $241 million.
Speaking to reporters in New Delhi, following meetings with India’s newly reelected Prime Minister Narendra Modi and Minister of External Affairs Subrahmanyam Jaishankar, Pompeo said: “Great friends are bound to have disagreements. The United States has been clear we seek greater market access and the removal of trade barriers in our economic relationship.”
“And today, I address these differences in the spirit of friendship and I think that the two of us will be able to see a good outcome for each of our two countries,” he added.
Echoing Pompeo’s sentiments, Jaishankar said, “My urging was that we take a constructive and pragmatic view … It is natural when you have trade, there will be issues and I think the real test of our intentions is our ability to address them effectively. We are committed to making it easier to do business, to provide a level playing field and to grow with the world economy.”
Delhi first announced plans to impose new tariffs a year ago in retaliation for increased US import duties on Indian steel and aluminum. But it repeatedly delayed them while the two sides held a series of trade talks
The decision to implement them was widely seen by analysts as a sign of strain in a bilateral relationship that, in recent decades, has been growing stronger under successive administrations.
On the ongoing tensions between the US and Iran, India – which is heavily dependent on imports to meet its energy needs – stressed the need to safeguard global energy supplies.
“We have a certain perspective on Iran, obviously from where we are based … It’s important that global energy supplies remain predictable and affordable, and I think that’s a concern to which Secretary Pompeo was very receptive,” said Jaishankar in response to a journalist’s question.
Pompeo said that the countries were on the same page when it came to Iran.
“Iran is the world’s largest state sponsor of terror and we know the Indian people, how they have suffered from terror around the world. I think there is a shared understanding of the threat and a common purpose to ensure to keep energy at the right price and deter this threat,” said Pompeo.
The two sides also discussed India’s $5 billion deal with Russian for a new air defense system.
The deal with Russia, signed in October 2018 during Russian President Vladimir Putin’s visit to India, potentially opens India up to US sanctions under legislation known as Countering America’s Adversaries Through Sanctions Act (CAATSA).
The law, signed by President Donald Trump in 2017, was designed to punish Moscow for “malign activities.” In September 2018, the US imposed sanctions against China for its purchases of Russian military equipment, including the S-400 surface-to-air missile system, under CAATSA legislation.
In response to a question on whether sanctions under CAATSA could be a threat, Jaishankar said: “We have many relationships with many countries. Many of them are of some standing, they have a history so I think we will do what is in our national interest and again part of that strategic partnership is the ability of each country to comprehend and appreciate the national interest.”
Harsh V. Pant, a professor in International Relations at King’s College London, said India’s ties with Russia would continue to be an “irritant” when it came to the Indo-US relationship. “Given the historical nature of this relationship, it is unlikely that India will cut off ties with Russia … But if you look at the trajectory, India is now giving more to the Americans. Larger buys of India’s defense sector are going to the West and there are reports of new deals in the pipeline for the US,” he explained.
’A big picture conversation’
More defense deals coupled with a cutback on Iranian oil supplies – India has shifted its oil imports away from Tehran to comply with US sanctions – are aspects that “India will try to showcase” and will be seen as an effort “to make it a big picture conversation,” Pant added.
Pompeo’s visit just days ahead of the G20 Summit in Japan, which starts on Friday, also set the stage for bilateral talks between Trump and Modi in Osaka.
“There are a number of issues on the table that have been bubbling under the surface for a few months. Hopefully this visit will make sure that the divergences that seem to be becoming more prominent are normalized and that you have a relationship that becomes more about the positives than about the negatives,” Pant told CNN.