U.S.-India Relations: Follow the Money

Ambassador Robert O. Blake, recently appointed to his new role as assistant secretary for South and Central Asian affairs, spoke to a room teeming with India experts yesterday at the Asia Society in New York. Though Blake has been a career diplomat, spending 2003-2006 as deputy chief of mission at the U.S. Mission in New Delhi, his message was clear — the future of U.S.-India relations rests on the shoulders of the private sector.

In advance of Indian Prime Minister Manmohan Singh’s upcoming visit to the White House, Singh’s first state visit since President Barack Obama has been in office, Blake stressed the opportunities for foreign investment in an India ruled by a new kind of Congress Party. It is a Congress Party that owes its opposition nothing and continues to make inroads nationwide in regional elections, and that will be around, most likely, for the next five years. “We have a real opportunity to work with our Indian friends,” Blake said, particularly in increasing the foreign investment cap in sectors such as education, technology and defense from 29 percent to 49 percent.

With an amenable party in control, almost every tangible relationship between the U.S. and India will be characterized by investment opportunities, according to Blake. While outlining Secretary of State Hillary Clinton’s “Five Pillars” to strengthen the U.S.-India relationship, Blake highlighted the great opportunities they provided for American companies to tap into arms sales, such as India’s recent order of C-130J aircraft from the United States, not to mention a $2.1 billion agreement expected to go through in early 2010 for the purchase of Boeing C-17s.

Beyond defense equipment, Blake sees agriculture as a key sector for investment — one that, if handled carefully, could show India’s 800 million rural citizens how diplomacy can work for them. According to Blake, the key question that needs answering is, How can we make the U.S.-India partnership real? He sees the USDA as having an important role in finding the answer, by helping to develop initiatives such as more efficient farm-to-market schemes.

Though business opportunities dominated his speech, Blake concluded with India’s diplomatic role in a changing world. He said that India has shown a great interest in taking part in global decision-making bodies, including a bid for a permanent seat on the U.N. Security Council. But voting “present” is not going to be enough. Issues such as nonproliferation and counterterrorism will require India to provide not just their vote, but solutions, he said.

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