The U.S.-India Strategic Partnership: An Overview of Defense and Nuclear Courtship

Obama and Singh One of the most striking features of U.S. and Indian foreign policy during the last decade has been their strategic engagement with each other. Today, these estranged democracies of the Cold War[i] era have become engaged democracies. Both have come a long way to construct a mutually beneficial relationship. The demise of the Soviet Union has jettisoned the historical and ideological baggage of the Cold War period. Subsequently, the growing influence of the Indian-American community, lobbying in the U.S. Congress backed by the India Caucus, the information and technology revolution in India, and the increasing interaction between the American and Indian business and professional communities have provided a positive environment for restructuring their relationship. Following domestic economic liberalization, and in light of a drastically changed unipolar world, India focused on reformulating its foreign policy, with engaging the United States as a top priority.

It was not until the waning days of the Clinton administration and early years of the George W. Bush administration that the relationship began to flourish and achieved a remarkable transformation.[ii] During the Obama administration, the U.S.-India partnership went through a lull phase. Nonetheless, the progress made during the first strategic dialogue in June 2010 and President Barack Obama’s visit to India in November 2010 has put the U.S.-India strategic partnership back on track. Washington and New Delhi are engaged in strategic dialogue and have addressed many critical issues at the bilateral, regional, and international levels. But their views have differed on certain issues related to counter-terrorism,[iii] especially with regard to each others' legal systems as illustrated by the case of the Lashkar-e-Taeba (LeT) terrorist David Headley. Their stances on important geopolitical concerns such as Iran and certain trade issues have differed as well and remain divergent. Nevertheless, the U.S.-India relationship today is marked by unprecedented convergence of geostrategic and geo-economic interests based on democratic values and principles. This strategic partnership is visible in all the aspects of the bilateral relationship and is noticeable in the New Framework for the Defense Agreement, the U.S.-India civilian nuclear energy deal, frequent joint military exercises, defense ties, defense sales, counter-terrorism cooperation, high-tech cooperation, and economic cooperation. But the most significant features of this strategic partnership are in the defense, security, and nuclear spheres. These issues are the main component of the wider U.S.-India economic, political, and strategic relationship in the context of the emerging international order. Given current trends, in the coming years, the United States and India will be the two biggest countries to be aligned in a bilateral security and defense partnership. Through their partnership, the United States and India can have a stabilizing influence in the global balance of power in the twenty-first century. This article looks into the recent trends and challenges of the U.S.-India strategic partnership, as well as the partnership’s anticipated trajectory. Towards Strategic Partnership In the post-Cold War period, the U.S.-India defense cooperation began with the Kickleighter proposal which was formalized in the Agreed Minutes on Defense Cooperation in 1995.[iv] Subsequently, the U.S.-India Defense Policy Group, led by the U.S. Defense Secretary and the Indian Defense Minister, further infused confidence in the bilateral relationship at a higher level. However, it was the George W. Bush administration and especially the Pentagon that redefined the security partnership with India. With the rise of China and the apparent threat from the rise of Islamic fundamentalism, the Bush administration and the Pentagon reevaluated and upgraded the strategic importance of India as a potential partner in providing peace and stability in the Indian Ocean and shaping a new Asian balance of power. The U.S.-India engagement gained a new sense of propinquity after 11 September 2001. In a speech delivered in New Delhi in September, the U.S. Ambassador to India, Robert Blackwill, reiterated the earlier U.S. position, saying that “President Bush has a global approach to U.S.-India relations, consistent with the rise of India as a world power,” adding that this was “because no nation can promote its values and advance its interests without the help of allies and friends.”[v] By now, U.S.-India relations had started coming out of the syndrome of U.S.-Pakistan ties and this was due to substantial changes in how both Washington and New Delhi interpreted the global threat environment and adjusted their bilateral relations to be more accommodating. India’s support for President Bush’s proposed missile defense system and full cooperation with the United States after 9/11 were received positively by the Pentagon. High level military and political leaders from both countries began to visit each other’s capitals more frequently, with a focus on institutional dialogue on defense cooperation. Growing Military and Defense Ties Since 2001, significant progress has been made in U.S.-India inter-military cooperation, which is now manifest in more than fifty joint military exercises and combined military operations, such as naval cooperation during Operation Enduring Freedom in Afghanistan and the Malabar Naval exercise involving Quad group nations (the United States, Japan, Australia, and India) in the Bay of Bengal. The prompt and efficacious coordination of the Quad nations’ naval forces during the tsunami disaster in December 2004 demonstrated the potential of this cooperation in traditional as well as non-traditional security issues:

The US Pacific Command and Indian naval forces have been frequently engaging in naval exercises. Besides US Pacific Command plans to deploy US technical assets on Indian ships for improved    coordination and execution of joint tasks to tackle the security challenges in the future. Securing the sea lanes of communication between the East Asia and the West Asia is a critical objective of both India and the United States.[vi]

The logic behind these exercises is to develop inter-operability, the ability of American and Indian forces to communicate, coordinate, and fight together in order to enhance their cooperative security relationship. But this cooperation needs to go beyond the U.S. Pacific Command (PACOM) and include U.S. Central Command backed by the institutionalization of Pentagon dialogue. Operation Enduring Freedom and Quad exercises initiatives show that India is overcoming its hesitancy in military cooperation with the United States outside the UN framework and is collaborating on a more comprehensive range of issues that directly or indirectly affect both countries. The top American and Indian leaders began to emphasize the significance of the countries’ strategic ties while defense and military personnel infused the interaction with substance and a spirit of cooperation. All these positive developments led to a breakthrough in U.S.-India relations and a diplomatic achievement in the form of Next Steps in Strategic Partnership (NSSP).[vii] This agreement committed both countries to working together in four difficult arenas—civilian nuclear energy, civilian space programs, high-technology trade, and missile defense. The NSSP began to guide the U.S.-India strategic partnership, yielding two major landmark agreements designed to enhance defense and nuclear ties, namely the ten-year defense agreement and the U.S.-India civilian nuclear deal. The ten-year New Framework for the U.S.-India Defense Relationship signed in June 2005 was a further step in streamlining the collaboration in multilateral operations, expansion of two-way defense trade, increasing opportunities for technology transfers, and co-production and enhancement of collaboration related to missile defense. The agreement unveiled mechanisms to promote long-term bilateral defense industrial ties and the possible outsourcing of research and production to India. This agreement provides opportunities for the Indian defense industry to better position itself in a world where defense industries of the advanced countries are globalizing. It not only helps India’s defense modernization efforts but also diversifies the sources of defense acquisition and technology transfers and co-production. Moreover, it recognizes the need in Washington and New Delhi to add more depth to the U.S.-India defense engagement for a stable balance of power in Asia. In addition, it opened up India’s defense market for the U.S. defense industry. Eventually, impressive progress in the field of defense commerce became visible in the commercial military sales to India. Today, many large defense companies from Boeing to Lockheed Martin have offices in India in order to tap into India’s defense market. The Indian defense industry is faced with the challenges of breaking out of a parent-client relationship to enter into equal partnership for joint-production in the defense sector while simultaneously developing its own domestic defense industry.[viii] To overcome the challenges of modernization and further develop its defense industry, India is inviting private and foreign companies in co-production through offset arrangements. The Indian government has introduced the minimum requirement of 30 percent direct offsets in the defense sector aimed at helping broaden the defense production base, for both the public sector units and the private sector base. The backbone of any defense power includes substantial funding, a high technology base with a technically sound workforce, a well-endowed R&D infrastructure, and a competent defense industry. For a developing nation, India is fairly well-off on many counts.[ix] But India’s great power aspirations cannot be fulfilled unless it has credible defense preparedness to deal with its external security threats which emanate from adversaries like Pakistan and China. Historically, India’s biggest weakness has been in building its defensive capabilities. Unlike the Cold War period when India was totally dependent on the Soviet defense industry, it has diversified its sources of defense acquisition in the last decade by entering into a strategic relationship with Israel and other technologically advanced nations such as France, the United Kingdom, and other European nations. But the biggest development in India’s defense acquisition lies ahead in its ties with the U.S. defense industry. Since the end of the Cold War, the U.S. defense industry has undergone a restructuring and has shown a tremendous amount of pliability and a robust capability to overcome challenges.[x] The future of the U.S. defense and aerospace industry depends on the ability of the industry to attract, develop, and retain a properly skilled scientific, engineering, and production workforce as well as markets for its exports.[xi] With an aging workforce, the U.S. defense industry faces an impending talent gap. In this context, India, with its skilled and technologically adept workforce of low-cost, well-educated, and English speaking laborers, is becoming an important destination for U.S. defense companies. Russia has gained a majority share of India’s defense market, about 70-80 percent, while Israel and the West European countries, namely France, Britain, and Germany, hold about 20-30 percent.[xii] But in the last decade, U.S.-India defense trade has grown to $10 billion and India’s multi-million dollar defense modernization plan offers a market of $80 billion by 2015.[xiii] Thus, the American defense industry has the opportunity to become one of the leading players in India’s defense market. This partnership will go beyond the buyer-seller relationship and will be based on joint co-production and technology transfer under an offset arrangement, thus fulfilling India’s defense industry goal as well. In addition, this defense industry collaboration is mutually beneficial as the U.S. defense industry can obtain benefits from India, one of the leading knowledge economies, through its soft power potential in the defense and military sectors and the lower cost of production, particularly of manufacturing sub-systems and components and lower repair costs.[xiv] U.S. defense companies are eager to access India’s profitable defense market. India, on its part, is not averse to the idea of getting U.S. arms, given its new obligations and pursuits in Asia. Improving U.S.-India strategic and defense ties also bodes well for India’s ties with the United States in the defense industry sector. This strategic partnership between the world’s two largest democracies will have a considerable impact on global governance for a peaceful and stable international order in the twenty-first century. The Civilian Nuclear Energy Cooperation One of the primary irritants in the U.S.-India relationship has been the nuclear issue. The Bush administration freed the relationship from the nuclear stalemate, which mainly was grounded in India’s refusal to sign the Nuclear Nonproliferation Treaty and the U.S. Nuclear Nonproliferation Act of 1978 which barred India from getting any kind of sensitive, high technology assistance. In this context, the nuclear deal signed on 18 July 2005, known as the “United States-India Nuclear Cooperation Approval and Nonproliferation Enhancement Act,” is a landmark step. [xv] This agreement was aimed at addressing concerns such as energy security, nuclear safety cooperation, and Indian integration into the global nuclear regime so as to facilitate India’s desire for renewed access to safeguarded nuclear fuel and advanced nuclear reactors.[xvi] The nuclear agreement is part of a larger set of initiatives between the United States and India involving space, dual-use high technology, advanced military equipment, and missile defense.[xvii] In fact, without the nuclear deal, the overall U.S.-India strategic and defense partnership would not have been possible. Without the nuclear roadblock being bypassed, the defense industry relationship would have remained still-born since U.S. laws and nonproliferation policy do not permit cooperation with a non-NPT nuclear weapons state that has been under sanctions for three decades. The pact has led to the dismantling of the technology denial regimes of the Nuclear Nonproliferation Act of 1978 that came after India’s first nuclear bomb test in 1974. The technological denial regime of the Nuclear Nonproliferation Act of 1978 had put a U.S. ban on sale or transfer of sensitive and dual use technology to India and constrained nuclear energy and defense collaboration.[xviii] The exception to the nuclear nonproliferation regime and the U.S. nuclear legislation was defended by the Bush administration on the grounds that India would be incorporated into the nuclear nonproliferation regime and that the agreement would address India’s looming energy crisis. In the broader context, the nuclear deal shows the Bush administration’s commitments towards helping India become a great power by acknowledging India’s emerging global economic and military significance. It marked a rediscovery of mutual strategic relevance between the United States and India, resulting in a gradual paradigm shift in the balance of power in Asia that could impact the geostrategic politics at the global level in the future. During his visit to India in November 2010, President Obama gave the nod to India’s inclusion in the Nuclear Suppliers Group (NSG) and three other multilateral export control groups. In 2011 at the NSG’s plenary meeting, the United States came out with a “Food for Thought” paper on possibilities for bringing India into the group.[xix] Though the United States has yet to make a substantial commercial deal to reap the benefits from the nuclear deal, Russia, France,[xx] and Australia have begun to access the Indian nuclear energy market. Ultimately, the nuclear deal has helped India address its energy security concerns, facilitated U.S.-India defense ties, enhanced India’s international profile, and assisted in counter-balancing China. Despite a few nuclear nonproliferation advocates in the Obama administration, there is an acknowledgment that India’s unique status as a de facto nuclear nation cannot be taken back. This conclusion is fortified by the fact that India has adhered to the strict nonproliferation rules of the nuclear club despite being a non-signatory to the Nuclear Nonproliferation Treaty. Thus, there seems to be very little difference between Washington and New Delhi with regards to nuclear nonproliferation issues. In the near future, the immediate issue will be how the Indian Parliament deals with the Civilian Nuclear Liability Bill, which is caught in a political tussle with opposition parties strongly disapproving of certain features of the legislation. The United States is pressing for early passage of the bill so that U.S. companies are not left behind in the race for India’s energy market. It is important for the United States and India as they have yet to reap the benefits of the nuclear deal and for further strengthening of their deepening strategic partnership. Conclusion The U.S.-India strategic partnership will hinge on defense industry collaboration fulfilling India’s long-term goal of improving its capacity to design, manufacture, and develop arms. This will also depend on the economic viability of transfer of technology and its applicability to India’s defense industry requirements. The package offered by the United States ought to be attractive enough to give the Indian government leverage to overcome domestic political and institutional opposition to the U.S.-India relationship. The increased U.S. investment in the Indian defense sector, dual use technology transfer, and a partnership based on mutual interest will be hallmarks of U.S.-India defense industry collaboration. The U.S.-India strategic partnership has become especially significant in the context of the United States’s rebalancing policy in the Asia-Pacific region. From the wider geostrategic perspective of the American troops’ exit from Afghanistan in 2014, the U.S. stance on Pakistan in the context of its inability to address India’s concerns of terrorism and Islamic fundamentalism will be important for the U.S.-India relationship. In the broader context, how Washington deals with Beijing in relation to New Delhi—which might impinge on India’s position in the South Asian security complex—will further determine the pace of this strategic partnership. Strategic engagement with the United States remains one of India’s top foreign policy priorities. A remaining U.S. concern is the passage of a nuclear liability bill in the Indian Parliament that would open avenues for U.S. companies’ investment in India’s burgeoning nuclear industry. India’s second phase of economic reforms that was initiated in 2012 has, however, opened opportunities for U.S. investments in Indian higher education, the retail market sector, and the insurance and aerospace industries, which auger well for this significant partnership of the twenty-first century. The rebalancing strategy of the United States in the Asia-Pacific region indicates that it is pursuing a balance of power in the Asia-Pacific region in which India figures prominently. But the future of U.S. policy with respect to India and Pakistan remains uncertain. George W. Bush’s “strategic partnership” with India was possible because of clear de-hyphenation of the U.S. relationship with India and Pakistan, a fact which needs to be kept in mind when speculating about the future. Today, the U.S.-India relationship is more institutionalized and level in the defense, military, energy, technology, and economic areas. The two countries are no longer stranded in archaic ideological clashes of interests. Their relationship is now based on the shared identities and norms of democratic values backed by civil society interaction, cultural exchange, the Indian-American community and India caucus lobbying efforts, and growing business interaction. These factors will strengthen in the future, and the deepening strategic partnership will be long-lasting. The U.S. and India have a major role to play in global governance to achieve a stable and peaceful world in the twenty-first century.


[i] See Dennis Kux, India and the United States: Estranged Democracies 1941–1991 (London: National Defense University Press, 1994).
[ii] See Sumit Ganguly, Andrew Scobell, and Brian Shoup, eds., US-Indian Strategic Cooperation into the 21st Century (London: Rutledge, 2006) and S. Paul Kapur and Sumit Ganguly, “The Transformation of U.S.-India Relations: An Explanation for the Rapprochement and Prospects for the Future,” Asian Survey 47, no. 4 (July/August 2007): 642–656.
[iii] For details on the U.S.-India counterterrorism collaboration, see Ashok Sharma, “Counter-terrorism Cooperation in the Context of the Indo-US Strategic Partnership: An Appraisal,” India Quarterly 68, no. 4 (December 2012): 315-330. Also see Dennis Kux, India and the United States: Estranged Democracies 1941–1991 (London: National Defense University Press, 1994).
[iv] For detailed developments of Indo-U.S. defense ties during the 1990s, see Sumit Ganguly, “America and India at a Turning Point,” Current History (March 2005): 120-24; Dinesh Kumar, “Defence in Indo-US Relations,” Occasional Paper Series, IDSA, New Delhi, August 1997; Ashok Sharma, “Indo-US Strategic Convergence: An Overview of Defence and Military Cooperation,” CLAWS, Paper No. 2, Knowledge World, 2008.
[v] Robert Blackwill on US-India Collaboration on International Issues (New Delhi, Washington File, 4 September 2001).
[vi] Anupam Srivastwa, “India-US Towards True Partnership,” The Journal of International Security Affairs (Fall 2006): 21-28.
[vii] Joint Press Statement: “Next Steps in Strategic Partnership between India and the United States,” Washington, DC, 17 September 2004, http://www.indianembassy.org/press_release/2004/sep/17.htm.
[viii] Deba R. Mohanty, “Trends in Defence Industry” in Jasjit Singh, ed., Aerospace Power and India’s Defence (New Delhi: Knowledge World, 2007), 99-119.
[ix] Fali Homi Major, “Blue Print for Indian Aerospace Industry,” Indian Defence Review 22, no.4, http://www.indiandefencereview.com/?p=139 (date accessed: 22 July 2008).
[x] Eugene Gholz and Harvey M. Sapolsky, “Restructuring the US Defence Industry,” International Security 24, no. 3 (Winter 2000): 5-51; Ashok Sharma, “US Defence Industry Trends,” Air Power 2, no. 2 (2007): 133-156.
[xi] James W. Canon, “The Changing Defence Industrial Base,” Aerospace America (August 2006): 35-38.
[xii] Ajay Singh, “Quest for Self - Reliance,” in Jasjit Singh, ed., India’s Defence Spending: Assessing Future Needs (New Delhi: Knowledge World, 2001), 127.
[xiii] “India-US trade can touch $500 billion in 10 years,” The Times of India, 14 March 2013.
[xiv] Gurmeet Kanwal, “Indo-US Defence Cooperation: Full Steam Ahead,” 25 September 2007, http://www.ipcs.org/article/military/indo-us-defence-co-operation-full-steam-ahead-2378.html (date accessed: 21 February 2010). For detailed insight on this subject see Stephen P. Cohen and Sunil Das Gupta, Arming without Aiming (New Delhi: Penguin/Viking, 2010).
[xv] “India Passes Nuclear Deal,” The New York Times, 30 August 2010; India, United States sign historic Civil Nuclear Agreement, https://www.indianembassy.org/India_Review/2008/Nov%2008.pdf%20 (date accessed: 22 January 2009).
[xvi] Ashok Sharma, “Indo-US Strategic Convergence: An Overview of Military and Defence Cooperation,” Centre for Land Warfare Studies, Manekshaw Research Paper, 2008.
[xvii] Ashley J. Tellis, “India as a New Global Power: An Action Agenda for the United States,” Carnegie Endowment for Peace, July 2005.
[xix] Daniel Horner, “NSG Still Mulling Indian Membership,” Arms Control Today (July/August 2012), http://www.armscontrol.org/2012_07-08/NSG_Still_Mulling_Indian_Membership (date accessed: 8 July 2012).
[xx] Sharon Squassoni, “The U.S.-Indian Deal and Its Impact,” Arms Control Today (July/August 2010), http://www.armscontrol.org/act/2010_07-08/squassoni#bio (date accessed: 24 June 2012).