An awkward dance

Book review of 'Indian Foreign Trade'

Indian Foreign Trade

Trumped up or down

Amiya Chandra

Pentagon Press

157 pages; Rs 295

And so it begins. Under the full glare of the international media, the two leaders lurched towards each other, embracing in an awkward bear hug, as they seek to define the broad contours of the relationship between the two countries under the new US presidency. 

Compared to his meetings with the former US president, Barack Obama, Prime Minister Narendra Modi’s first meeting with Donald Trump was scarcely an extraordinary affair. 

But coming on the heels of Mr Trump withdrawing the US from the Trans-Pacific Partnership (TPP), the Paris climate accord and the flare-up over the contentious issue of H1B visas, its extraordinariness lies in it not being extraordinary.

Considering that Mr Trump’s approach is a complete departure from that of his predecessors, what can India expect? And how should it prepare itself?

In a new book, India Foreign Trade – Trumped Up or Down?, Amiya Chandra, a civil servant with experience in foreign trade, attempts to explore these questions and more by looking at India’s foreign trade against the backdrop of the Trump presidency.

The first section of the book begins by analysing how Mr Trump negotiates deals by drawing on his views as elaborated in his widely read book The Art of the Deal.  Never mind that books of such nature are generally self-aggrandised accounts and, as such, may not accurately reflect Mr Trump’s views or how he will navigate his presidency.

Based on his analysis, Mr Chandra suggests that India should work on four key pivots. To wit: Mr Modi must forge a personal relationship with Mr Trump; he must also ensure an alignment of the administration; India must proactively set the agenda; and work in solution mode.

Ignoring, for the moment, the lack of specificity embedded in these motherhood statements, this is hardly a new approach. 

Mr Modi has gone to great lengths to establish a personal relationship with other leaders hoping that personal chemistry would surmount other obstacles. If anything, this has been a hallmark of his foreign policy. 

On the issue of alignment of the administration, considering that Mr Chandra is a civil servant, this is a rather unusual yet bold statement to make. “The most frustrating thing for any leadership is to see its good work being undone by a non-aligned bureaucratic set up,” he writes. 

Is he implying that various initiatives the prime minister has taken have been undermined by the bureaucracy? If so, Mr Chandra doesn’t offer proof to back his claim.

He argues, perhaps rightly so, that access to India’s market is our greatest leverage against the Americans. This can be used to our advantage in negotiations with the US.

“The Indian government will have to put in serious thoughts on opening the Indian market to American companies if India wishes to have a far greater access to the American market,” he says, implying that India can offer American companies greater access in return for meeting its needs. In fact, Mr Trump has also goaded Mr Modi into doing the same.

But the fundamental question is whether Indian companies are ready to face such competition. Unfortunately, the author does not offer any detailed analysis on this. 

It is also surprising that at a time when many in India are questioning the benefits accruing from free trade agreements (FTAs), Mr Chandra makes a strong pitch for an FTA between the two countries.

There are some useful suggestions such as the need to rejig the organisational structure to promote exports. “The conventional way of forming committees and assigning them the task to suggest and recommend policies within a short duration of time, and merely pass on their suggestions and demands to the government is not going to increase India’s exports in America,” he writes. 

But then, precious little is said on what should replace the current setup. Simply importing ideas from other countries may not work given differing institutional structures. 

Another useful idea is to classify US states into three categories based on how much India exports to them. These, then, could be mapped sector wise, providing some indication of where the export potential lies. 

But the practicality of his other ideas is debatable. 

At one place, he suggests that the three million Indian Americans in the US be roped in to help boost our exports by providing market intelligence and launch pads for companies.

Think Sundar Pichai launching Baba Ramdev’s products on a global scale. A radical idea. But as Mr Chandra tells us, radical is the new normal.

Some statements go nowhere. Example: “The US administration fails to recognize that India has a mind of its own or that Indian exporters will have to improve upon their attitude towards exporters, they will have to move from the lower end of the value chain to the upper end."

It is a pity that more meaningful questions have been left unanswered. For instance: Does the US really consider India as the fulcrum of its pivot to the East? And if so, can a strategic partnership be deepened in the absence of greater economic partnership? The book could have fruitfully explored these questions too.