Remarks on India

James B. Steinberg
Deputy Secretary
The Brookings Institution
Washington, DC
March 23, 2009

Good morning. It is a pleasure to be back at Brookings and among so many old friends. Thank you, Steve, for inviting me to be here today – I am more used to introducing others than speaking here.

This conference is taking place at an important time. We are living in a challenging moment – one that brings great responsibilities, but also significant opportunities, for both the United States and India. Today, with our new administration taking office in Washington, and India embarking on its remarkable democratic exercise over the coming months, I’d like to take a step away from the crises of the moment to discuss how the United States and India can build on our accomplishments of recent years, to forge a stronger, more comprehensive relationship to meet the challenges of the 21st century.

For over a decade, our relationship with India has been on a rapidly advancing trajectory. President Bill Clinton seized on the end of the Cold War and India’s rapid economic emergence and liberalization to lay the foundation for this transformation. As I sit in the Deputy Secretary’s office on the 7th floor of the State Department, I’m acutely conscious of the hard work and determination that my friend Strobe Talbott put into addressing decades of suspicion and estrangement to set the stage for a new era in our bilateral relationship.

The Bush Administration built upon this legacy, with the U.S.-India Civil Nuclear Deal – a landmark achievement for both of our countries. American leaders, Republicans and Democrats alike, including a Senator from Illinois and a Senator from New York who would soon get promoted to different jobs, believed the world would be better served with India inside the non-proliferation tent than outside it. And Indian leaders, from a range of parties and places, likewise voted "yes" on this historic agreement. The agreement not only provides a concrete platform for economic and technological cooperation between our two countries, but also offers a basis for moving beyond one of the most serious barriers to our political cooperation – the status of India’s nuclear program.

These breakthroughs would not have been possible without the political foresight of Presidents Clinton and Bush, the hard work and determination of Strobe and former Under Secretary Nick Burns, and their Indian counterparts. But perhaps more important over the long term are the strong and growing ties between the people of the United States and India.

As is the case in all of America’s most enduring relationships, the U.S.-India bond is between two societies, not just two governments. The connection between us is not limited to our capitals. The Indian Diaspora community, the influx of Indian students in our universities, collaboration between our NGOs and civil society and growing economic and business interests – all have been pulling India and the United States closer for decades.

I know from my time as Dean of the LBJ School at the University of Texas how meaningful these ties can be, and the potential that they bring. At the LBJ school, we collaborated closely with IIM. Our governments must harness and build on these close links in the business, academic, and scientific communities. We have seen throughout our history that where these human ties and bonds of values are strong, even the sharp policy differences that might arise between our governments from time to time will not derail our relationship.

Indeed, it can be argued that our governments were late in catching up to the transformed relationship between our peoples. But now the stage is set to embark on what I might term the third stage of our rapprochement. As space faring nations, we know that the third stage is crucial to boosting us into orbit.

President Obama and Secretary Clinton remain committed to expanding these opportunities and our cooperation. As India approaches national elections in the coming months, we look forward to developing a comprehensive agenda – doing more bilaterally, regionally, and globally, across the full spectrum of economic, political and security challenges

Our economic ties have played a major role in bringing our two countries together. The entrepreneurship and innovation of India’s private sector, combined with economic reforms implemented by its government, have contributed to a doubling in bilateral trade from $21 billion to $44 billion between our two countries between 2004 and 2008. But we have much more we can do in the future such as negotiating a bilateral investment treaty; removing tariff and non-tariff trade barriers between our countries; improving enforcement of intellectual property rights; and opening avenues for the private sector to engage directly by loosening government restrictions and actively promoting trade in areas of mutual interest.

One of the more promising opportunities for deepening economic engagement concerns India’s ongoing development challenge -- to bridge the gap between its vibrant middle class and its still too persistent urban and rural poverty. An estimated 700 million Indians still live under $2 a day. The U.S. and India should leverage existing business and scientific community ties, seeking to establish public-private partnerships to catalyze technological advancements in the fields of education, energy, health, and agriculture that will improve the lives of average Indians, stimulate small and medium enterprises in India, and grow markets for U.S. goods and services. Two excellent means of accomplishing these goals are through the CEO Forum, led by CEOs from leading American and Indian businesses who make recommendations for removal of barriers to growth in trade and investment, and the Trade Policy Forum, which seeks to improve the business environment in areas such as trade, investment, services, and agriculture.

Energy is another fruitful avenue for bilateral cooperation. In a country where 500 million people still lack access to electricity, the United States and India have enormous opportunities to collaborate on energy generation and infrastructure. The U.S. is committed to working directly with India as a robust partner on civilian nuclear energy. Our governments have taken some steps toward realization of the 1-2-3 Agreement, but we both need to do more, and we look forward to working with India to fulfill the promise of civilian nuclear energy cooperation. President Obama has just sent our first trade mission to India, and it’s on solar energy. Energy is a focal point of our relationship, and trade in renewable energy technologies has the possibility of taking our relationship to new heights.

On the security side, we have also taken important steps together, and have a good foundation on which to build. Our navies now exercise regularly together and the fruits of this cooperation were apparent in our contributions to tsunami relief in 2004. We are also opening up avenues to increase defense trade through strong advocacy for U.S. firms. We also need to conclude an agreement on End Use Monitoring, a Logistics Support Agreement and a communications agreement – and to work more closely together on counterterrorism and non-proliferation concerns.

Together, our populations are 1.4 billion strong, and we can do so much together to advance our common interests. We should find ways to work the private sector into our government-to-government dialogues and use strong people to people ties to advance cooperation in education and science and technology, and to facilitate rural development in India.

But the future of our relationship depends on more than strengthening bilateral ties and engagement. As India emerges as one of the world’s leading economic and political powers, the central question is how the United States and India can work together to address the regional and global challenges that no one country alone can solve.

To paraphrase my old boss, President Clinton, the central question facing India in the coming years is how India defines its greatness as it takes an increasingly prominent role in global affairs. In the past, the emergence of new powers placed enormous stress on the international system. Because power was seen as a zero sum game, the rise of new powers was viewed as inherent threat to the status quo. But in the twenty-first century, the emergence of India as strong, stable, democratic and outwardly looking global player with global interests has the potential to enhance the effectiveness of the international system and the security and well-being of all, in a positive sum game.

For this reason, the real test of our relationship will be how we work together on the great common challenges of our era – strengthening the global trade and investment system, addressing transnational threats like nuclear weapons proliferation, terrorism and pandemic disease, and meeting the urgent danger posed by climate change. As great powers, together we have an obligation to help produce what we academics call "global public goods", to pursue an enlightened version of self-interest that recognizes that individual nations will only thrive if we all thrive, and to build the institutions of cooperation needed to facilitate common efforts to meet shared challenges. Whether at the UN, the WTO, or the Conference on Disarmament, we both have a responsibility to eschew rhetoric in favor of forward looking, practical solutions to the great issues of our time.

We will begin this work next week in London, where the G-20 leaders will meet to discuss how to address both the near term and systemic challenges posed by the global financial crisis, and where President Obama and Prime Minister Singh will have a chance to meet face to face to share views. It is vital that together we take steps to foster growth, enhance transparent regulation, and keep our markets open to global trade.

Later this year, the world will come together in Copenhagen to consider the next steps in addressing climate change. The United States and India are at different stages of development, and India’s overall share of greenhouse gas emissions is small compared to the U.S. and other leading emitters. Indian Special Envoy on climate change Shyam Saran is in Washington this week, and will be speaking to you later today, and we look forward to engaging with him on this important issue.

The U.S. is committed to putting in place a mandatory plan to cut its own emissions. But India too has a responsibility to play a leadership role in helping to bring about a consensus that brings both developed and developing countries into a global framework. I understand that India has concerns about caps, but with its growing emissions, we must work with India to ensure it is part of any effective solution to climate change. We stand ready not only to look at how American technologies can be linked to any solution, but how we can partner with India to develop new, greener energy sources and promote conservation. Furthermore, India’s high energy demand and insufficient domestic energy resources make it a prime partner for potential investment and technology sharing, both as part of the climate change agenda and also broader energy development.

Next year, we will have another opportunity to demonstrate our commitment to building the structures of global cooperation with the Non-Proliferation Treaty review conference. Forty years after the adoption of the NPT, the world is now on the brink of the danger that President Kennedy so eloquently warned about – uncontrolled nuclear proliferation – but in an environment even more dangerous than the one he envisioned, with the prospect of the nuclear capabilities falling into the hands of terrorists. Both the United States and India have a responsibility to craft a strengthened NPT regime that fosters safe, affordable nuclear power to help the globe’s energy and environment needs, while assuring against the spread of nuclear weapons. President Obama has pledged U.S. leadership in meeting our obligations as the world’s most powerful nuclear state, but India has a special role, and responsibility, as well.

In the nearer term, the United States and India must work together to help address what is one of the most urgent security challenges facing us – to work with the democratic governments of Pakistan and Afghanistan to root out the violent forces that threaten the stability of the region and pose a direct danger to the Indian and American homelands. We are joined in the searing memories of September 11th and Mumbai in understanding the urgency and importance of this task.

This week President Obama will set out our own approach to this urgent challenge, drawing upon the heroic labor of Brookings’ own Bruce Riedel, Ambassador Richard Holbrooke, and many others. And we are grateful for the efforts India has made to support economic development and reconstruction in Afghanistan. Next week, we will gather in The Hague, under the chairmanship of the United Nations and the Dutch, to develop a collaborative program involving all of Afghanistan’s neighbors and key donors. Later in April, the friends of democratic Pakistan will meet to pledge support for Pakistan’s efforts to strengthen its economy and institutions to meet the existential threats they face. As President Zardari and the Pakistani government take the courageous steps needed to confront and eliminate extremists, India and the United States must work together with all of our international partners to support them and to further their effort.

Over the years, the U.S. and India have established many mechanisms for consultation and cooperation. Over two dozen formal diplomatic dialogues exist to address wide-ranging bilateral and global issues. Some have been fruitful; others have stalled. Moving forward, we should explore creating a broader strategic framework for these dialogues – so our relationship can achieve the kind of ambitious goals for coordinated global leadership I have set forth today.

As we embark on this critical third stage of our lift-off, we should do so with a clear-eyed recognition that we will not always agree on how best to address the vital challenges of our times. Our history, geography and economic development are different, and will inevitably lead to some divergence of perspectives. But our common values – and our intertwined fate – require us to make the effort to seek common ground. That is the commitment of President Obama and Secretary Clinton, and one that we look forward to working on with the next government in Delhi.

Thank you. I look forward to your questions.