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Gearing up for 2+2

PK Vasudeva |

The inaugural ‘two-plus-two’ talks between India and the US have now been shifted from Washington to Delhi. The strategic meeting, which was agreed upon by President Trump and Narendra Modi in June last year, had been put off by the US twice this year for unprecedented reasons.

The external affairs minister, Sushma Swaraj, and the defence minister, Nirmala Sitharaman, will now host the US Secretary of State, Michael R Pompeo, and US Secretary of Defence, James Mattis, in New Delhi on 6 September for the 2+2 dialogue.

The meeting will cover a broad range of bilateral, regional and global issues of shared interest, with a view to strengthening strategic and security ties between the two countries. The dialogue will also address issues of communications, compatibility and security meeting (COMCASA).

It will be a milestone in bilateral ties as it will strengthen defence cooperation, surveillance helicopters as well as the Quad process involving India, Japan, Australia and the US to work with other nations of South-east Asia for informal protection of shipping lanes in several straits where China’s influence has grown over time.

According to Ms Swaraj, the agenda is for ‘long-term linkages with a focus on the Afghanistan peace process, terrorism, and maritime security in the Indo-Pacific region’. The bilateral ties have been under stress this year for a variety of reasons ~ from Iranian oil imports and Russian defence supplies to visa issues and trade tariffs imposed by Trump on steel and other goods.

A key meeting will also be held on the US policy towards countries that do business with Iran and Russia so that there is broad convergence on the issue. It is important to note that India buys Iranian oil ,while Russia is a major supplier of defence equipment. A permanent solution will be sought on these two crucial issues.

According to reports, the U.S. State Department had earlier told the media in Washington that the Trump Administration had asked India and China to stop all imports of Iranian oil by November 4 or face sanctions. Iran will always remain an important plank of India’s foreign policy. As President Trump takes an extreme view of sanctions against Iran, it may restrict India’s manoeuvering space significantly, if New Delhi is not careful.

Iran moved back to the third slot as a source for energy in 2016, soon after the Joint Comprehensive Plan of Action (JCPOA) unshackled global engagement with Tehran. India needs Iran for a link to Central Asia and Russia, and it also wants to use Iran’s Chabahar port not only as an access point for Afghanistan, but also to link it to the International North-South Transport Corridor (INSTC).

Chabahar, the port in the Sistan-Balochistan province on the energy-rich nation’s southern coast, is easily accessible from India’s western coast and is increasingly seen as a counter to Pakistan’s Gwadar Port, which is being developed with Chinese investment and is located at a distance of around 80 km from Chabahar. Iran will therefore remain the key to India’s foreign policy matrix.

India has moved towards acquiring five advance S-400 Triumf Air Defence Missile Systems from Russia valued at Rs 39,000 crore despite the looming threat of US sanctions. Once India inducts S-400 systems, the vital installations like nuclear power plants and nuclear arsenal will be well protected and taken care of.

These long-range missile systems will tighten its air defence mechanism, particularly all along the 4,000-km-long Sino-India border. India and Russia have worked on a roadmap to get around the financial sanctions flowing out of the recent US law called Countering America’s Adversaries Through Sanctions Act (CAATSA) that seeks to deter countries from buying Russian weapons.

On 21 July, the US has let it be known that it is working with “partner countries”, including India, to help them identify and avoid engaging in potentially sanctionable activity under the CAATSA. On 20 July, the US defence secretary, Jim Mattis, had spoken in favour of waivers for sanctions being imposed against nations that buy military gear from Russia. The move comes amid concerns that imposing sanctions, particularly in the case of India and other Asian allies, could threaten friendly relationships that the US has been trying to build up in recent years.

The US Congress on 23 July took the call on granting India a waiver after intense lobbying by the US administration, led by Mattis, and Indian diplomats in Washington. The waiver will allow India to buy Russian defence equipment.

Delhi’s argument was that “a weaker India in this neighbourhood is not in the US interest”. Sources said that putting India under sanctions would weaken the Indo-Pacific strategy of the US. Moreover, China has been assertive and proactive in the Indo-Pacific region.

Delhi has also pointed out that the US has been one of the major beneficiaries of India’s diversification in defence procurement, and that the trend is likely to continue with India being designated as a “major defence partner” of the US.

The final piece of legislation will exempt three countries, India, Indonesia and Vietnam, from the sanctions regime under CAATSA, which seeks to deter countries from buying Russian weapon system or Iranian oil for the time being.

India is now one of the fastest growing economies and is also one of the biggest markets in the world for investment. Therefore, the US cannot afford to implement CAATSA on India, as it will have serious repercussions on the US economy.

At the 2+2 summit, India will find itself in a ‘Catch 22 position’ because it cannot agree with all the unjustified diktats of the Trump administration ~ stop the import of oil from Iran, don’t buy defence hardware from Russia, reduce tariffs on US goods.

The Trump administration will have to finally decide if the sanctions on India will be accorded a permanent waiver during the 2+2 dialogue. The US President feels the world, including India, is treating US like a ‘piggy bank’ in dealing with world trade deals. Hopefully, all these differences will be thrashed out amicably during the 6 September 2+2 summit.

The writer is retired senior professor of International Trade.