In the ancient world, Roman Emperor Julius Caesar, Pompeius Magnus, and Marcus Licinius Crassus formed a triumvirate that ruled for several years. Should we now think a new one has been created in Tianjin, China, by President Xi Jinping of China, President Vladimir Putin of Russia, and Prime Minister Modi of India — who recently embraced and held hands on the world stage?
The answer is no.
Images of Putin and Xi Jinping wooing Modi in Tianjin are certainly evoking howls of dismay in Western capitals. This is particularly true in Washington, in view of a highly successful U.S.–India partnership that effectively began with President Bill Clinton. The Indian government, public, and media were shocked by the recent imposition of 50 percent tariffs on the country — but that was more an act of retribution for India’s decision to buy Russian oil at discounts than an effort to remedy the 10th-largest trade deficit of the U.S. for goods and services.
Talk of a rupture in India–U.S. relations makes for catchy headlines; however, it is operationally, militarily, financially, and culturally difficult for India and the U.S. to realistically downgrade the relationship. Nonetheless, we should expect diplomatic heartburn in the short term, and announced tightened controls on student visas will cause more stress.
India’s importance to the U.S. should not be underestimated: Fear of China and Islamist jihad as well as potential trade and investment have been unifying forces for decades. Bilateral trade of goods and services, once very modest, has reached over $210 billion, with the U.S. being India’s third-largest source of direct investment.
India is also an important security partner in the QUAD diplomatic initiative and Malabar maritime exercises, alongside Japan and Australia. The U.S. and Indian navies even share encryption platforms for intelligence and interoperability. High-visibility joint ventures in the aerospace and defense sector such as a Tata-Lockheed manufacturing and maintenance collaboration, Tata-Boeing manufacture of military and civilian airframes, and a Mahindra-Anduril venture to produce naval and AI-enabled aerial autonomous systems underscore U.S.–India security commitments. Earlier this year, the U.S. and India agreed to enhanced civil space cooperation.
The U.S. and India are further connected through technology and the diaspora: Microsoft, Alphabet, Adobe, IBM, Palo Alto Networks, and Micron have CEOs with Indian antecedents. Silicon Valley, much of the Fortune 500, and India’s tech hubs are connected through operations and invested capital. In the U.S., there are over five million people of Indian origin.
India has a reputation for levying high tariffs. They are high for the agricultural and automotive sectors, which the country wishes to protect. For many agricultural products, for example, the tariff rate is 33 percent, but this is less than the EU and Japan. India’s trade-weighted tariffs, however, are less than 5 percent. Protecting the agricultural sector is understandable, as it represents almost 45 percent of the country’s workforce. Further, the automotive sector employs 37 million workers.
India’s reliance on Russia is a largely immutable fact of life. It has been this way since independence. In the 1950s, the Soviet Union supported India’s military, heavy industrial, and agricultural sectors at a time when U.S. aid was limited to agricultural exports under Public Law 480 — with substantial military and economic support for rival Pakistan. Over the years, the Soviet Union was unconcerned with India’s nuclear development, unlike the U.S., and, also unlike the U.S., Russia does not lecture India on human rights. The Soviet Union and subsequently Russia have long been viewed as sympathetic to decolonization and the needs of developing countries.
The Indian military has a heavy dependence on Russia. The Indian Army has a large inventory of T-72 and T-90 tanks — about 90 percent of the Army’s equipment is of Russian origin. For the Indian Air Force, it is a similar situation, with its Sukhoi and MiG aircraft composing about 71 percent of the total. About 41 percent of the Indian Navy’s equipment, including one aircraft carrier, are of Russian origin.
India, trying to balance between the West and BRICS nations, has a 4,000-mile-long combined border with Pakistan and China, two belligerents. It cannot afford to antagonize Russia, as its national security continues to depend upon Russian military equipment, which is over one-third of its arms imports.
China is a very different story. Border disputes in the Ladakh region of Kashmir and on the eastern frontier with Tibet have resulted in armed clashes and the China–India War in 1962, a decisive loss that the Indians remember well. Further, China would like to subjugate India in its command and control structure known as the Belt and Road Initiative, which would allow Beijing to dictate the terms of trade and investment. Through various dual-use maritime installations known as a “string of pearls,” China has sought to encircle India. Thus far, however, India has refused to capitulate to Chinese authority.
The U.S. position should be to carefully evaluate India’s unavoidable dependence on Russia, and to advise India in clear terms to beware of the Chinese dragon. President Trump needs to apply his “art of the deal” to India, as only he can. The offer of high-visibility military, technology, or space cooperation, combined with reduced tariffs, would be the right signal.
Frank Schell is a business strategy consultant and former senior vice president of the First National Bank of Chicago. He was a lecturer at the Harris School of Public Policy, University of Chicago, and is a contributor of opinion pieces to various journals.
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