A Trade War Beckons...?

Thereby have been 2 interesting developments from The USA - one expected, one rather unexpected.

This takes the cake : "“In many areas, however, IPR protection and enforcement challenges are growing, and there are serious questions regarding the future condition of the innovation climate in India across multiple sectors and disciplines.”" From article one. It seems to be a harbinger of things to come - with wide ranging sanctions against India on a series of sectors, with a single minded view to benefiting the USA only. This is despite India's latest IPR regime being a significant improvement over the past - although poorer people do stand to be hit even there - as well as a timed framework being in place. A clear case is being made out for India being rogue state, and apparently, only India is being singled out - and only USA is complaining. Food for thought, methinks.

The second article {the one on solar panels} is a real beauty, and I quote : "These unfair requirements are against the WTO rules, and we are standing up today for the rights of American workers and businesses,” said US trade representative Mike Froman. Under the “domestic content requirement” rule, India expects foreign suppliers to use specified locally sourced components such as cells and thin-films used in solar panels." Wow, a superpower, and one of the richest nations on the Earth is bullying a weaker country to further its own business interests, so that it can become richer, its people can have more business - and the Indian Sector gets pushed under by imports, Instead of partnering India in its own development, it is pushing India even further into dependency!

There will be some attempts to link this with the DK episdoe - but that does not hold water, for any number of well-documented reasons. The USA has been against Indian Development for quite some time now. Note the following developments over the past decade, which tell their own story, a story of naked greed, open ambition, and unhidden desire for the Indian Market, with no empathy for manifest Indian needs and genuine wants. This does not sound like trade between partners - let alone strategic partners:

  1. Nuclear Tests - Sanctions, followed by a hasty volte-face years later as the potential of the market was realised
  2. Refusal to handover Cryogenic Technology, while evincing interest in India's Nuclear Market!
  3. Attempt to Blockade India's Agricultural Subsidies as China might gain, unmindful of the brutal and deleterious impact on Indian Farm Output and Employment, given that 80% of farmers are dependent on Subsidies to make it even out. Without that, all of these would be making a loss from their farms - and this has nothing to do with how effective out subsidy in reaching the farmers. Fact of the matter is that due to USA, our farmers would (might?) have died, If this sounds fanciful, look up farmer suicides in India
  4. Attempt to blockade India Retail FDI : with objections to the 30% sourcing clause from domestic industry
  5. The poor reputation of the USA as a defence supplier, with a penchant to withdraw or withhold critical parts and supplies in order to push forward their own agenda

There will be other examples; but these should suffice. And all these 7 points are raising the same question - is the great friend of ours, so chased by some sections of our society and polity, a true partner, whether in trade or in a strategic relationship? Are these actions in sync with a friendly country, that wants to talk to us? That wants to further our growth and development? What are we gaining, or what do we stand to gain and what do we stand to lose? Is it worth the effort? Far more, can such an undependable and fickle country which shifts tracks every 4 years be really dependable, as opposed to say, Russia or Israel. who have stuck with us despite internal political compulsions?

You might state the USA has an entirely different set of political realities - both internal as well as external, which is why you cannot have the same yardstick for both cases. But think a moment - those differences in realities are the precise reasons that any hope of an India-USA bhai-bhai situation is pointless! Given its internal multiple power centres - much like Pakistan - it simply cannot be trusted. It will be forced to continue to pressurise India firstly because it knows no other ways of doing business, and secondly because its vested interests internally as well as internationally will not allow it to. 

This is building up suspiciously like one other previous partnership of ours - recall the euphoria over India-China Bhai-Bhai, when all indications to the contrary we ignored, and we headed full-tilt into disaster. I admit the coparison is far-fetched; but it cannot be shaken off. Admittedly, there are differences - the China case was driven by the Government, this is being driven both by the Government as well as by a section of the people, who see benefit in joining sides with the USA. These benefits are undeniable there -but they come at a cost, which few seem to have factored into their calculations, driven by a PIO-NRI lobby group growing in power in the states, and our own external realities, surrounded as we are by enemies. Perhaps we see no options but to do we have to - but all of us would do well to remember the cost associated with it, as also the cost paid by other friends of the USA. 

Let us keep one thing in mind : despite its admittedly shining rise in the USA in both business as well as political prowess, and their inarguable support to India and its cause, the entire NRI-PIO lobby has had precious little impact on the USA's policies in any sphere of the relationship, at least not a definable long-term impact and change. That exposes the power of the NRI-PIO group; maybe it is too early to tell. But can we Indians afford the time it will take for USA to realise? I dont think so. The clock is ticking... 

When you are up against a strategy that is wholly amoral any which way you look at it, one which is preferring gains to businesses of a super-rich nations over benefits to a poor nation struggling to generate jobs, it becomes something other than trade or business. Are we on the anvil of our First Out-and-Out Trade War? The current set of developments seems to indicate that. Not only a trade war - but confirmation that the USA does not have our interests at heart. Any nation refusing to develop our strengths, and having an income several time ours, by a factor of 15-20, cannot be anything but amoral. It would have been understandable if both nations were at similar levels - but this is highway robbery by an arrogant superpower...

Jaago, Sonewaalon! 


  1. Hi Vishal,

    I've been following your blog for a while, also I closely follow often participate in the discussions over the India Leadership network over LinkedIn. I would love to syndicate some of your posts on our site dailyscoop.in

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    1. Hi Ashwin,
      I certainly have no issues... please connect with me on LinkedIn; You have disabled connect tab on your profile. Or drop me a mail


  2. Highway robbery by a super power... great expression

    1. Thanks, Mukesh... could not think of anything else!


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