Can the two-year-old India-US Initiative on Critical and Emerging Technologies survive the political transition in Washington, now only days away?
Rudra Chaudhuri, director Carnegie India and his colleague Konark Bhandari, ask this question in their paper titled ICET From 2022 to 2025: Assessment, Learnings and the Way Forward.
As they write, “We have had limited interactions with those considered close to the Trump administration, we have also consulted personalities who were a part of the first Trump administration. What is clear is that the imperatives that drive the iCET – in doing more in AI, Quantum, Defense and so on – will not necessarily serve as a problem. There is clear interest in diversifying away from China to create clean supply chains.”
They pointed to the fact that three of four foundational defence agreements (Basic Exchange & Cooperation, Industrial Security, Communication Compatibility & Security) were completed under Trump.
And while the Trump administration’s focus on tariffs and economic pressures maybe challenging in the short term, this is unlikely to have a long-term effect on strategic technology cooperation. Trump could rebrand or redesign it since it is tied too closely with the Biden administration.
The key here is the personalities that are presently driving iCET. Could there be a “potential loss of spirit channeled through personalities in the US that have championed iCET imperatives in the Department of Defense, Department of Energy,” but are expected to make way for Trump appointees?
Chaudhuri and Bhandari acknowledge that “There is a high probability new actors will share less of this spirit for change … this will require effort and tact that are certainly not insurmountable.”
They argue that for Indian partners, continuous engagement of “lightning rods” in the US Congress, labour unions (concerned about offshoring) and industry partners will be key.
Doubling down on instruments like the Strategic Trade Dialogue led by India’s foreign secretary (and his US counterpart deputy secretary of state), is crucial since this will unpack sensitive export control issues. Since the current Indian ambassador to the US was until recently foreign secretary, this may not be such an issue.
The China Question
Will iCET survive if US-China relations change? Will it (iCET) be as important for India if there is a rapprochement with China? What if Xi Jinping were replaced by a leader more open to negotiating with the US given their current economic troubles?
“There is clear realisation in the US that supply chains need to diverted away from China,” the authors write, quoting a senior US military official telling them of a Congressional mandate to “diversify all military supplies from China by 2028.”
The official also said there are opportunities here for US and Indian defence firms and the US would like to see a portion of its military supplies coming from India. Whether India can do this depends on its ability to attract investments for the right kind of manufacturing to take off.
This would not mean immediate disinvestments from China, but companies and governments will constantly seek to hedge the overproduction of strategic tools and supplies from one jurisdiction. It’s safe to say this will remain the age of industrial policy for the near future.
It’s also not just about China. India offers huge potential, it explains why large US firms are investing in that country, from cloud infra to applications, massive R&D centres to the codesign of strategic technologies.
What About Russia?
At the highest level, India and the US have developed an understanding about the Russia relationship. India’s purchase of large quantities of Russian oil is not an issue as the US says it helps stabilise prices.
As for US sanctions, the report recommends “more face time between the Indian banks and the US Treasury Department … the iCET provides an umbrella for these discussions, workshops and knowledge exchange sessions.”
The authors say they know of Indian companies that have cleared fundamental doubts in such dialogues. Communication is really the key, that and coordinating actions where possible to lower the blow.
The authors say what will be tricky going forward is India’s need for different technologies, such as hypersonic missiles, that will drive a national security prerogative to attain them. India could tilt to Russia, or perhaps the US and France to attain these.
Much will depend on the extent to which the US is prepared to provide licences and waivers to sell or coproduce such technologies to and in India. If there are frictions here, India could tilt to France or Russia that have a record of codeveloping missiles with Indian firms.
But what if Russia starts transferring some of its strategic crown jewels to China? This would have major implications for India, which also explains India’s steady diversification from dependence on Russia.
Russia will remain important to India and that should not be seen as a liability for the US. There is a trusted channel in India to share messages and communicate high concerns to Russian counterparts even if India does not join a formal process for dialogue and peacemaking.
