Ever since the early 1990s India has been moving closer to the United States of America.

The collapse of the world socialist system, the disintegration of the Soviet Union, and China becoming a capitalist-roader hastened this process. The forces that once talked of free enterprise and attacked Nehru-Indira Gandhi dispensation have become emboldened to talk of the “wasted” or “disastrous” years when the ruling party mouthed its commitment to socialism, equitable economic growth, public sector commanding economic heights and state controlling the steering wheel of the economy. There is no dearth of such people at present boldly walking in the corridors of power in India’s capital. 

India was one of the earliest to go in for the ten points of the Washington consensus. It meant limiting the role of the state, privatizing the existing public sector enterprises, opening the doors of the economy for free flow of goods and capital, imposing fiscal discipline, keeping labour under control and, above all, allowing market forces to operate freely without any substantial regulation. It has been the firm belief of the people and parties that have been in power since the early 1990s that there is no other way out except this to make India an economic super power. Time and again the rising Sensex of the Bombay Stock Exchange and the increasing rate of economic growth have been held up as a conclusive proof of the success of the new strategy based on the Washington consensus. Each time the Sensex has crossed the next 1,000 mark it has been celebrated with great fanfare by the government as well as the media.

It has been the firm belief of ruling coalitions since the 1990s that America is now fully on the side of India. Gone are the days when its the then Secretary of State John Foster Dulles declared Goa as a province of Portugal, President Nixon tried to snub Indira Gandhi on Bangla Desh liberation and sent the Seventh Fleet to intimidate India, America backed out on its commitment to fund the proposed Bokaro steel mill project because Nehru had refused to have a collaborator from the private sector and successive US administrations befriended Pakistan and propped it up as a rival to India. Now, it is believed that America treats India as its staunch and trustworthy ally and is ready to help it build a powerful modern economy in order to match China. A very big plus point discovered after many years in favour of India is its vibrant democracy unrivalled in the developing world. This is the main consideration in signing a nuclear deal with India and getting it cleared by the Congress. To quote The Economist (December 2): “George Bush calculates that the future benefits of pleasing India, a hoped-for ally in balancing the rise of China, will outweigh the blow to the NPT…. India is being offered all the benefits of NPT membership without any of its obligations … Easing the squeeze on its uranium imports– India was running short of the enriched stuff for its civilian and military needs….”

It is believed that America will help India make up its deficiency in both capital and technology and the nuclear deal will bring about a big rise in electricity generation. With plenty of foreign direct investment, the latest technology and sufficient electricity, Indian economic growth will exceed the double-digit rate. With its percolation to the masses at large, more and more people will come out of poverty, ignorance and ill health. Dr. Manmohan Singh spelled it out to the joint session of the US Congress in 2005 in the following words: “American investments in India, especially in new technology areas, will help US companies to reduce costs and become more competitive globally. US firms are already leading the foreign investment drive in India. I believe 400 of the Fortune 500 are already in India.” At another place, he said: “India needs massive direct foreign investment, especially in modernizing our infrastructure.” His government was resolved to create conducive conditions to attract $150 billion foreign direct investment from America to build infrastructure facilities alone.

America is to find an outlet for its surplus capital. Wal-Mart is to have a scope to enter India’s lucrative retail trade when its rate of profit in the US has been stagnating. Out sourcing is going to reduce costs of production for American multinationals, on an average, to one-sixth, making them more competitive globally and increase their profits enormously. In order to propitiate the US Congress to get the approval for the nuclear deal, India placed in 2005 an order to the tune of $6.9 billion for 50 American Boeing aircrafts in preference to France’s Airbus, when Bush made a personal request. India was to buy conventional military equipment worth $5 billion consequent upon the approval of the nuclear deal.   

Though India has been over enthusiastic and labouring under the illusion that America too is interested in making India attain the status of a super power, American perspective has been quite different. The American approach is quite contrary to India’s expectations. It is informed by considerations of its own selfish interests. To understand this, one must go through the recently published Report of the National Intelligence Council, entitled “Mapping the Global Future”. The National Intelligence Council is an associate body of the CIA. This more than 120 page-long- report is now an unclassified document. It is authored by Robert L. Hutchings of the Princeton University.  

It underlines that ongoing globalization is irreversible and will continue to march ahead under the tutelage of the US, which will “remain single most powerful actor economically, technologically, militarily.” It goes on to add: “The very magnitude and speed of change resulting from a globalizing world … will be a definitive feature of the world out to 2020…. The role of the United States will be an important variable in how the world is shaped, influencing the path that states and non-state actors choose to follow.”

There is no denying the fact that China, India, Brazil and a few others are going to emerge as important global players but they will have to follow the leadership of the US and they cannot dare defy it. By 2020 “India’s GNP will have overtaken or be on the threshold of overtaking European economies”, yet it cannot think even in its dreams to forsake the US leadership. Obviously, economic growth hinges on securing new technologies and they will be available only when America is propitiated. Multinational corporations will be “key agents of change in dispersing technology widely, further integrating the world economy, and promoting economic progress in the developing world” and they will be under the firm direction of the USA. The US will “retain enormous advantages, playing a pivotal role across the broad range of issues – economic, technological, political, and militarily – that no other state will match by 2020.” In these circumstances, the talk of building an independent Indian economy and pursuing an independent foreign policy will be nothing but a chimera.

Commenting on the Report, Samir Amin, has this to say: “The National Intelligence Council’s predictions for the world in 2020 … do not contemplate the possibility that the principles of liberal globalization in force, described as the “Davos Project,” could be called in question. This is because, according to Washington and its allies, these principles are perfect and there is therefore no creditable alternative to them.” (Monthly Review, December 2006). Amin goes on to add: “The decline of the UN will continue, the political governance of the world system will “fall upon” the United States.” Those who are emboldened by recent changes in Latin America, highlighted by populist uprisings in Venezuela and elsewhere, are told that, ultimately, they will come to nothing. The implications are intimidating. It is to be seen whether India is going to stand firmly by the commitment made by its prime minister in parliament that “India will find it difficult to and cannot accept any such conditions beyond those already agreed to in the understandings with the United States.”

       Girish Mishra,
       E-mail: [email protected]  

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