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In the 1970s and 1980s, India's close ties with the Soviet Union and its pro-Soviet, pro-Vietnamese policies toward Cambodia precluded development of any constructive relations between India on the one hand and the countries of the Association of Southeast Asian Nations (ASEAN--see Glossary) on the other. Furthermore, India's military buildup, particularly of its naval capabilities and naval installations in the Andaman and Nicobar Islands, worried ASEAN policy makers, who saw India as a potential threat to regional security. Indian-ASEAN relations improved in the 1990s as the result of the end of the bipolar world system, the UN-brokered peace settlement in Cambodia, and the breakup of the Soviet Union. For its part, New Delhi sought to boost economic and trade ties with the region and to establish closer political and defense ties in order to counteract China's growing influence in Southeast Asia. ASEAN countries grew less concerned with India's regional ambitions after New Delhi's decision to curtail its naval buildup because of financial restraints. In January 1992, ASEAN accepted India's proposal to become a "sectoral dialogue partner" in the areas of trade, technical and labor development, technology, and tourism. India's new role was expected to facilitate economic cooperation. In January 1993, India and Malaysia signed a memorandum of understanding on defense cooperation.
India has had close ties with Cambodia, Laos, and Vietnam as a result of its 1954-73 chairmanship of the International Commissions of Control and Supervision established by the 1954 Geneva Accords on Indochina. These relations were enhanced by India's friendship with the Soviet Union, particularly after 1971 and, in the case of Vietnam, shared perceptions of the threat from China. With regard to Cambodia, India recognized the Vietnamese-installed regime in 1980 and worked to avert censure of the regime in the annual UN General Assembly and triennial Nonaligned Movement summit meetings. In the late 1980s, Indian diplomats attempted to facilitate the search for peace in Cambodia, and India participated in the 1989 Paris Peace Conference on Cambodia and in subsequent efforts to find a solution to the Cambodian situation. New Delhi played a minor but nevertheless constructive role before and after the Agreement on a Comprehensive Political Settlement of the Cambodia Conflict and three other documents were signed in Paris on October 23, 1991. India contributed more than 1,700 civilian, military, and police personnel to the United Nations Advanced Mission in Cambodia and the United Nations Transitional Authority in Cambodia.
India has traditionally pursued a pro-Arab policy regarding the Arab-Israeli conflict in order to counteract Pakistani influence in the region and to secure access to Middle East petroleum resources. In the 1950s and early 1960s, this pro-Arab stance did not help India in establishing good relations with all Arab countries but may have served to keep peace with its own Muslim minority. India concentrated on developing a close relationship with Egypt on the strength of Nehru's ties with Egyptian president Gamel Abdul Nasser. But the New Delhi-Cairo friendship was insufficient to counteract Arab sympathy for Pakistan in its dispute with India. Furthermore, Indian-Egyptian ties came at the expense of cultivating relations with such countries as Saudi Arabia and Jordan and thus limited India's influence in the region.
In the late 1960s and in the 1970s, India successfully improved bilateral relations by developing mutually beneficial economic exchanges with a number of Islamic countries, particularly Iran, Iraq, Saudi Arabia, and the other Persian Gulf states. The strength of India's economic ties enabled it to build strong relationships with Iran and Iraq, which helped India weather the displeasure of Islamic countries stemming from India's war with Pakistan in 1971. Indian-Middle Eastern relations were further strengthened by New Delhi's anti-Israeli stance in the Arab-Israeli wars of 1967 and 1973 and by Indian support for the fourfold oil price rise in 1973 by the Organization of the Petroleum Exporting Countries (OPEC). Closer ties with Middle Eastern countries were dictated by India's dependency on petroleum imports. Oil represented 8 percent of India's total imports in 1971; 42 percent in 1981; and 28 percent in 1991. India purchased oil from Iran, Iraq, Saudi Arabia, the United Arab Emirates, and Kuwait and, in return, provided engineering services, manufactured goods, and labor. The 1980-88 Iran-Iraq War forced India to shift its oil purchases from Iran and Iraq to Saudi Arabia and the Persian Gulf states. Saudi Arabia and the Gulf states also have received large numbers of Indian workers and manufactures and have become the regional base for Indian business operations.
Two events in 1978 and 1979--the installation of the Islamic regime under Ayatollah Sayyid Ruhollah Musavi Khomeini in Iran and the Soviet invasion of Afghanistan in support of the pro-Soviet Marxist regime in Kabul--complicated India's relations with Middle East countries. From the Indian perspective, these two events and the Iran-Iraq War changed the balance of power in West Asia by weakening Iran as a regional power and a potential supporter of Pakistan, a situation favorable to India. At the same time, proxy superpower competition in Afghanistan strengthened the hand of India's adversary Pakistan by virtue of the military support Pakistan received from the United States, China, and Arab states led by Saudi Arabia. In the 1980s, India performed a delicate diplomatic balancing act. New Delhi took a position of neutrality in the Iran-Iraq War, maintained warm ties with Baghdad, and built workable political and economic relations with Tehran despite misgivings about the foreign policy goals of the Khomeini regime. India managed to improve relations with Middle Eastern countries that provided support to the Afghan mujahideen and Pakistan by redirecting Indian petroleum purchases to Saudi Arabia and the Persian Gulf countries. New Delhi, which traditionally had had close relations with Kabul, condemned the Soviet invasion only in the most perfunctory manner and provided diplomatic, economic, and logistic support for the Marxist regime.
In the early 1990s, India stepped back from its staunch anti-Israeli stance and support for the Palestinian cause. Besides practical economic and security considerations in the post-Cold War world, domestic politics--especially those influenced by Hindu nationalists--played a role in this reversal. In December 1991, India voted with the UN majority to repeal the UN resolution equating Zionism with racism. In 1992, following the example of the Soviet Union and China, India established diplomatic relations with Israel.
During the 1990-91 Persian Gulf War, Indian policy makers were torn between adopting a traditional nonaligned policy sympathetic to Iraq or favoring the coalition of moderate Arab and Western countries that could benefit Indian security and economic interests. India initially adopted an ambivalent approach, condemning both the Iraqi invasion of Kuwait and the intrusion of external forces into the region. When the National Front government led by V.P. Singh was replaced by the Chandra Shekhar minority government in November 1990, the Indian response changed. Wary of incurring the displeasure of the United States and other Western nations on whom India depended to obtain assistance from the International Monetary Fund (IMF--see Glossary), New Delhi voted for the UN resolution authorizing the use of force to expel Iraqi troops from Kuwait and rejected Iraq's linkage of the Kuwaiti and Palestinian problems. In January 1991, India also permitted United States military aircraft to refuel in Bombay. The refueling decision stirred such domestic controversy that the Chandra Shekhar government withdrew the refueling privileges in February 1991 to deflect the criticism of Rajiv Gandhi's Congress (I), which argued that India's nominal pro-United States tilt betrayed the country's nonaligned principles.
Prime Minister Narasimha Rao's September 1993 visit to Iran was hailed as "successful and useful" by the Indian media and seen as a vehicle for speeding up the improvement of bilateral relations. Key developments included discussions on the construction of a pipeline to supply Iranian natural gas to India and allowing India to develop transit facilities in Iran for Indian products destined for the landlocked Central Asian republics. India also sought to assuage its concerns over a possible Iranian-Central Asian republics nuclear nexus, which some saw as a potential and very serious threat to India should Pakistan also join in an Islamic nuclear front aimed at India and Israel. When Iranian president Hashemi Rafsanjani visited India in April 1995 to sign a major trade accord (the accord also was signed by the minister of foreign affairs of Turkmenistan) and five bilateral agreements, India-Iranian relations could be seen to be on the upswing.
Until large parts of Central Asia were incorporated into the Russian Empire in the mid-nineteenth century, relations between India and Central Asia had been close. During the post-1971 era of close Indian-Soviet relations, cultural exchanges flourished between India and the Central Asian republics. The dissolution of the Soviet Union forced India to construct policies to deal with the new political situation in the Central Asian republics. In 1991 and 1992, India established diplomatic relations with Kazakstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan and worked with these newly independent states to develop frameworks for diplomatic, economic, and cultural cooperation. Besides its long historical connections with this region, India sought good relations for several reasons: to prevent Pakistan from developing an anti-India coalition with the Central Asian states in the dispute over Kashmir, to persuade those states not to provide Pakistan with assistance in its nuclear program, to ensure continued contacts with long-standing commercial and military suppliers, and to provide new opportunities to Indian businesses.
Normal diplomatic and trade relations are an Indian goal in relations with the Central Asian republics. For example, economic and cultural affairs were the focal point of Indian prime minister P.V. Narahimsa Rao's official visit to Uzbekistan and Kazakstan in May 1993. Security matters also are important as witnessed by a February 1995 visit to India by Kazakstan's defense minister. Adherence to democracy and secularism by these countries also was regarded by India as desirable in order to ensure stability and social progress. The geopolitical competition between India and Pakistan for influence in these countries is likely to be a long-tern factor.
With regard to Afghanistan, India supported the Marxist regime in Kabul until its collapse in the spring of 1992. India then attempted to regain some influence in the country by cooperating with Iran to provide assistance to Dari-speaking and other minorities against the Pashtun groups backed by Pakistan in the ensuing civil war.
Despite the disintegration of the Soviet Union in 1991, the relationship between India and Russia remains one of considerable importance to both countries. Since the early 1950s, New Delhi and Moscow had built friendly relations on the basis of realpolitik. India's nonalignment enabled it to accept Soviet support in areas of strategic congruence, as in disputes with Pakistan and China, without subscribing to Soviet global policies or proposals for Asian collective security. Close and cooperative ties were forged in particular in the sectors of Indian industrial development and defense production and purchases. But the relationship was circumscribed by wide differences in domestic and social systems and the absence of substantial people-to-people contact--in contrast to India's relations with the United States (see United States, this ch.).
Ties between India and the Soviet Union initially were distant. Nehru had expressed admiration for the Soviet Union's rapid economic transformation, but the Soviet Union regarded India as a "tool of Anglo-American imperialism." After Josef Stalin's death in 1953, the Soviet Union expressed its hopes for "friendly cooperation" with India. This aim was prompted by the Soviet decision to broaden its international contacts and to cultivate the nonaligned and newly independent countries of Asia and Africa. Nehru's state visit to the Soviet Union in June 1955 was the first of its kind for an Indian prime minister. It was followed by the trip of Premier Nikolai Bulganin and General Secretary Nikita Khrushchev to India in November and December 1955. The Soviet leaders endorsed the entire range of Indian foreign policy based on the Panch Shila and supported India's position against Pakistan on Kashmir. The Soviet Union also supported India's position vis-�-vis Portugal on Goa, which was territorially integrated into India as a union territory by the Indian armed forces in December 1961 (it became a state in May 1987).
The Soviet Union and some East European countries offered India new avenues of trade and economic assistance. By 1965 the Soviet Union was the second largest national contributor to India's development. These new arrangements contributed to India's emergence as a significant industrial power through the construction of plants to produce steel, heavy machinery and equipment, machine tools, and precision instruments, and to generate power and extract and refine petroleum. Soviet investment was in India's public-sector industry, which the World Bank (see Glossary) and Western industrial powers had been unwilling to assist until spurred by Soviet competition. Soviet aid was extended on the basis of long-term, government-to-government programs, which covered successive phases of technical training for Indians, supply of raw materials, progressive use of Indian inputs, and markets for finished products. Bilateral arrangements were made in nonconvertible national currencies, helping to conserve India's scarce foreign exchange. Thus the Soviet contribution to Indian economic development was generally regarded by foreign and domestic observers as positive (see Foreign Economic Relations, ch. 6).
Nehru obtained a Soviet commitment to neutrality on the India-China border dispute and war of 1962. During the India-Pakistan war of 1965, the Soviet Union acted with the United States in the UN Security Council to bring about a cease-fire. Soviet premier Aleksei N. Kosygin went further by offering his good offices for a negotiated settlement, which took place at Tashkent on January 10, 1966. Until 1969 the Soviet Union took an evenhanded position in South Asia and supplied a limited quantity of arms to Pakistan in 1968. From 1959 India had accepted Soviet offers of military sales. Indian acquisition of Soviet military equipment was important because purchases were made against deferred rupee payments, a major concession to India's chronic shortage of foreign exchange. Simultaneous provisions were made for licensed manufacture and modification in India, one criterion of self-reliant defense on which India placed increasing emphasis. In addition, Soviet sales were made without any demands for restricted deployment, adjustments in Indian policies toward other countries, adherence to Soviet global policies, or acceptance of Soviet military advisers. In this way, Indian national autonomy was not compromised.
The most intimate phase in relations between India and the Soviet Union was the period between 1971 and 1976: its highlight was the twenty-year Treaty of Peace, Friendship, and Cooperation of August 1971. Articles 8, 9, and 10 of the treaty committed the parties "to abstain from providing any assistance to any third party that engages in armed conflict with the other" and "in the event of either party being subjected to an attack or threat thereof . . . to immediately enter into mutual consultations." India benefited at the time because the Soviet Union came to support the Indian position on Bangladesh and because the treaty acted as a deterrent to China. New Delhi also received accelerated shipments of Soviet military equipment in the last quarter of 1971. The first state visit of Soviet president Leonid Brezhnev to India in November 1973 was conducted with tremendous fanfare and stressed the theme of economic cooperation. By the late 1970s, the Soviet Union was India's largest trading partner.
The friendship treaty notwithstanding, Indira Gandhi did not alter important principles of Indian foreign policy. She made it clear that the Soviet Union would not receive any special privileges--much less naval base rights--in Indian ports, despite the major Soviet contribution to the construction of shipbuilding and ship-repair facilities at Bombay on the west coast and at Vishakhapatnam on the east coast. India's advocacy of the Indian Ocean as a zone of peace was directed against aggrandizement of the Soviet naval presence as much as that of other extraregional powers. By repeatedly emphasizing the nonexclusive nature of its friendship with the Soviet Union, India kept open the way for normalizing relations with China and improving ties with the West.
After the Soviet intervention in Afghanistan, Indian diplomats avoided condemnatory language and resolutions as useless Cold War exercises that could only antagonize the Soviet Union and postpone political settlement. They called instead for withdrawal of all foreign troops and negotiation among concerned parties. In meetings with Soviet leaders in New Delhi in 1980 and in Moscow in 1982, Indira Gandhi privately pressed harder for the withdrawal of Soviet troops and for the restoration of Afghanistan's traditional nonalignment and independence.
Rajiv Gandhi journeyed to the Soviet Union in 1985, 1986, 1987, and 1989, and Soviet president Mikhail S. Gorbachev traveled to India in 1986 and 1988. These visits and those of other high officials evoked effusive references to the "exemplary" (in Gorbachev's term) friendship between the two countries and also achieved the conclusion of agreements to expand economic, cultural, and scientific and technological cooperation. In 1985 and 1986, and again in 1988, both nations signed pacts to boost bilateral trade and provide Soviet investment and technical assistance for Indian industrial, telecommunications, and transportation projects. In 1985 and 1988, the Soviet Union also extended to India credits of 1 billion rubles and 3 billion rubles, respectively (a total of about US$2.4 billion), for the purchase of Soviet machinery and goods. Protocols for scientific cooperation, signed in 1985 and 1987, provided the framework for joint research and projects in space science and such high-technology areas as biotechnology, computers, and lasers. The flow of advanced Soviet military equipment also continued in the mid- and late 1980s (see The Air Force, ch. 10).
When the Soviet Union disintegrated, India was faced with the difficult task of reorienting its external affairs and forging relations with the fifteen Soviet successor states, of which Russia was the most important (see Central Asia, this ch.). In 1993 New Delhi and Moscow worked to redefine their relationship according to post-Cold War realities. During the January 1993 visit of Russian president Boris Yeltsin to India, the two countries signed agreements that signaled a new emphasis on economic cooperation in bilateral relations. The 1971 treaty was replaced with the new Treaty of Friendship and Cooperation, which dropped security clauses that in the Cold War were directed against the United States and China. Yeltsin stated that Russia would deliver cryogenic engines and space technology for India's space program under a US$350 million deal between the Indian Space Research Organisation (ISRO) and the Russian space agency, Glavkosmos, despite the imposition of sanctions on both organizations by the United States. In addition, Yeltsin expressed strong support for India's stand on Kashmir. A defense cooperation accord aimed at ensuring the continued supply of Russian arms and spare parts to satisfy the requirements of India's military and at promoting the joint production of defense equipment. Bilateral trade, which had fallen drastically during the 1990-92 period, was expected to revive following the resolution of the dispute over New Delhi's debt to Moscow and the May 1992 decision to abandon the 1978 rupee-ruble trade agreement in favor of the use of hard currency.
Pressure from the United States, which believed the engines and technology could be diverted to ballistic missile development, led the Russians to cancel most of the deal in July 1993. Russia did, however, supply rockets to help India to develop the technology to launch geostationary satellites, and, with cryogenic engine plans already in hand, the ISRO was determined to produce its own engines by 1997 (see Space and Nuclear Programs, ch. 10).
Despite Yeltsin's call for a realignment of Russia, India, and China to balance the West, Russia shares interests with the developed countries on nuclear proliferation issues. In November 1991, Moscow voted for a Pakistani-sponsored UN resolution calling for the establishment of a South Asian nuclear-free zone. Russia urged India to support the Treaty on the Non-Proliferation of Nuclear Weapons and decided in March 1992 to apply "full-scope safeguards" to future nuclear supply agreements. Russia also shares interests with the United States in cooling antagonisms between India and Pakistan, particularly with regard to Kashmir, thus making it unlikely that India could count on Russia in a future dispute with Pakistan.
Rao reciprocated Yeltsin's visit in July 1994. The two leaders signed declarations assuring international and bilateral goodwill and continuation of Russian arms and military equipment exports to India. Rao's Moscow visit lacked the controversy that characterized his May 1994 visit to the United States and was deemed an important success because of the various accords, one of which restored the sale of cryogenic engines to India.
Bilateral relations between India and Russia improved as a result of eight agreements signed in December 1994. The agreements cover military and technical cooperation from 1995 to 2000, merchant shipping, and promotion and mutual protection of investments, trade, and outer space cooperation. Political observers saw the visit of Russian prime minister Viktor Chernomyrdin that occasioned the signing of the eight agreements as a sign of a return to the earlier course of warm relations between New Delhi and Moscow. In March 1995, India and Russia signed agreements aimed at suppressing illegal weapons smuggling and drug trafficking. And when Russian nationalist Vladimir V. Zhirinovsky visited India in March 1995, he declared that he would give India large supplies of arms and military hardware if he were elected president of Russia.
With the end of the Cold War and the emergence of India's more outward-looking economic policies, the United States became increasingly important for India. In the mid-1990s, the United States was India's largest trading partner and a major source of technology and investment (see Aid; Trade, ch. 6). Indian students more than ever sought higher education in the United States, especially in the areas of science and engineering. Moreover, the presence of the more than 1 million Indians and Indian Americans residing in the United States was a factor in the relationship. Some foreign policy makers also saw India's strong democratic tradition, although much younger than that of the United States, as an important ingredient in India-United States relations. Despite the asymmetrical relationship that had existed since 1947, the areas of common interest converged in the early 1990s as the benefits of good relations were perceived on both sides. Some Indian observers, however, felt that the United States had a "negative agenda" concerning India with respect to human rights, the nuclear program, and the pace of economic reforms. Furthermore, India's long adherence to the principles of nonalignment has had an inhibiting effect on its evolving relations with the United States. Nevertheless, some opinion makers believed that an India-United States strategic alliance later in the 1990s was a possibility.
Until 1971 nonalignment had a dual effect on United States policies in South Asia. On the one hand, Washington considered Indian economic and political stability necessary to prevent that important regional player from succumbing to communism and Soviet influence; hence the United States gave economic assistance and support to India during its 1962 war with China (see External Aid, ch. 7). On the other hand, India's nonalignment had led the United States in 1954 to ally itself with Pakistan, which appeared to support Western security interests. The United States-Pakistan alliance was renewed in 1959, with accompanying assurances from President Dwight D. Eisenhower to Nehru that the arms supplied to Pakistan would not be used in any aggressive war. When Pakistan and India went to war in 1965, the United States government refused to support India and suspended military transfers to both countries.
In 1971 the intertwining of the United States-Soviet, Chinese-Soviet, and Indian-Pakistani conflicts dragged India-United States relations to the nadir. That year, while Washington initiated a new relationship with Beijing, New Delhi signed a friendship treaty with Moscow to counteract United States and Chinese influence in South Asia. As the situation in East Pakistan deteriorated, India was unable to convince the United States to cease arms deliveries to Pakistan and persuade Pakistan's leaders to reach a political settlement with East Pakistan's elected representatives. Indira Gandhi's November 1971 visit to Washington failed to alter President Richard M. Nixon's pro-Pakistan stance. When war formally began after Pakistani strikes on Indian airfields in early December 1971, the United States and China voted for a cease-fire in the UN Security Council, but the Soviet Union's veto prevented any resolution from coming into effect. Washington's subsequent deployment of a naval task force to the Bay of Bengal left many in India convinced that the United States was a major security threat.
Relations between India and the United States verged on the antagonistic throughout the 1970s. After Nixon abruptly terminated US$82 million in economic assistance, India closed down a large United States Agency for International Development program. The Indian government also restricted the flow of American scholars and students to India. India's criticisms of United States policies in Vietnam and Cambodia increased, and it upgraded its representation in Hanoi. When the United States expanded its naval base on the island of Diego Garcia and engaged in naval exercises with Pakistan in the Indian Ocean in 1974, India saw its security further threatened. Both governments, however, attempted to limit the damage to bilateral relations. A 1973 agreement defused a dispute over United States rupee holdings by writing off more than 50 percent of the debt and directing use of the remainder to mutually acceptable programs. In 1974 the Indo-United States Joint Commission was established to insulate bilateral dealings in education and culture, economics, and science and technology from political controversy and to provide mechanisms for regular exchanges at high levels of public life.
Hopes for improved relations were expressed in 1977 when Jimmy Carter became president of the United States and the Janata Party government led by Morarji Desai took over in India (see Political Parties, ch. 8). These expectations came to an abrupt end two years later when the Soviet Union invaded Afghanistan. The promulgation of the Carter Doctrine, establishment of the Rapid Deployment Force (later called the United States Central Command) and an Indian Ocean fleet, planned expansion of the naval base at Diego Garcia, and arrangements to supply Pakistan with US$3.2 billion in military and economic aid over five years all appeared as direct United States intervention in the countries of the Persian Gulf and Indian Ocean. These actions fueled instability in the region and, in India's view, threatened India's security.
The personal rapport between Indira Gandhi and United States president Ronald Reagan, established during a series of meetings in the early 1980s, enabled the two countries gradually to begin improving bilateral relations. The Reagan administration reassessed its policy toward India and decided to expand areas of cooperation, particularly in the economic and scientific realms, as a means of counteracting Soviet influence in the region. Washington also regarded New Delhi's status as the major regional power in South Asia in a more favorable light. For her part, Gandhi realized that India was unable to block United States arms sales to Pakistan, but that improved dialogue with the United States could open other areas of interaction that could benefit Indian interests. Indira Gandhi's highly successful 1982 state visit to the United States was followed by a series of high-level exchanges, including the visits of Vice President George Bush and Secretary of State George Shultz to India. In addition, in 1982 the two sides resolved their dispute concerning supplies of fuel and spare parts for the nuclear power plant at Tarapur. In 1984 the United States decided to expand technology transfers to India.
The warming trend in relations between New Delhi and Washington continued with the 1985 and 1987 visits by Prime Minister Rajiv Gandhi to Washington. Furthermore, as the United States appreciation of India's role as a force for stability in South Asia grew, Washington supported New Delhi's moves in Sri Lanka in 1987 and in Maldives in 1988. In the mid- and late 1980s, visits exchanged by the United States secretary of defense and the Indian minister of defence symbolized a modest but growing program of cooperation in military technology and other defense matters. In 1988 Washington and New Delhi finalized an accord to provide United States technology for India's light combat aircraft program and also agreed to transfer technology for the F-5 fighter. Cooperation between India and the United States in a variety of scientific fields followed the signing of a bilateral agreement on scientific and technological exchanges in 1985. Nonmilitary technology transfers also accelerated, and in 1987 India purchased a Cray supercomputer for agricultural research and weather forecasting and accepted stringent United States safeguards to preclude military uses. Furthermore, economic liberalization measures paved the way for increased trade and United States investment in India. In 1988 the improved economic climate resulted in the conclusion of a deal for a Pepsi-Cola plant and the signing of a bilateral tax treaty. In 1989 United States investment in India reached US$1 billion.
In the 1980s, the Indian and United States governments had divergent views on a wide range of international issues, including Afghanistan, Cambodia, the Middle East, and Central America. Serious differences also remained over United States policy toward Pakistan and the issue of nuclear proliferation. India was repeatedly incensed in the 1980s when the United States provided advanced military technology and other assistance to Pakistan. New Delhi also found objectionable Washington's unwillingness to cut off military assistance to Islamabad despite United States concerns about Pakistan's covert nuclear program. For its part, Washington continued to urge New Delhi to sign the Treaty on the Non-Proliferation of Nuclear Weapons and, after the successful test launch of the Indian Agni intermediate-range ballistic missile in May 1989, called on New Delhi to refrain from developing a ballistic missile capability by adhering to the restrictions of the Missile Technology Control Regime. India rejected these appeals on the grounds that it had a right to develop such technology and that the Treaty on the Non-Proliferation of Nuclear Weapons and the United States-sponsored Missile Technology Control Regime discriminated against nonnuclear states.
Bureaucratic and private-sector resistance to foreign participation in the economy, infrastructure problems, bureaucratic red tape, and legal problems remained formidable obstacles to significant Indian-United States economic cooperation. In the late 1980s, India had differences with the United States over improving its legal protection of intellectual property rights, opening its markets to American service industries, and liberalizing its foreign investment regulations. In April 1991, the Office of the United States Trade Representative placed India on Washington's watch list over intellectual property rights issues. Six months later, the United States gave India a three-month grace period before imposing retaliatory sanctions against India's pharmaceutical industry for inadequate patent protection. India resisted United States pressure to adopt a less protectionist stance in the Uruguay Round of negotiations to renew the General Agreement on Tariffs and Trade (GATT).
In the early 1990s, economic reforms permitted a qualitative breakthrough in relations between India and the United States. Washington was instrumental in speeding a US$1.8 billion IMF credit that New Delhi obtained in January 1991 to deal with a severe external-debt-payments crisis. In 1990 India and the United States signed a double taxation pact designed to facilitate American investment in India, further breaking a thirty-year deadlock in economic relations. The United States provided only modest bilateral economic assistance in the form of food aid but was India's largest trading partner and an important source of investments and technology. In December 1990, the United States approved the export of a second Cray supercomputer for the Indian Institute of Science in Bangalore, Karnataka, although the deal fell through two years later because of India's unwillingness to accept safeguards to prevent the computer's diversion to military uses.
The Soviet withdrawal from Afghanistan in 1989 had led Washington to reassess its relationship with Pakistan, with positive ramifications for New Delhi. Without containment of the Soviet Union as the driving factor behind close Pakistani-United States ties, and concerns mounting about Pakistan's nuclear weapons program, the United States suspended military and economic assistance to that country in October 1990. New Delhi appreciated this action and was relieved in summer 1991 when the United States Congress voted not to include India in the Pressler Amendment, which forbade United States assistance to Pakistan if it violated nuclear nonproliferation criteria. Washington also took a more evenhanded approach to the Kashmir problem in 1990, urging both antagonists to resolve their dispute peacefully under the terms of the Simla Accord. Furthermore, the United States began pressuring Pakistan to end its support for Kashmiri and Punjabi Sikh separatists. This pressure was in addition to efforts initiated in the 1980s to prevent assistance to Sikh terrorists from the Sikh expatriate community in the United States (see Rajiv Gandhi, ch. 1). In the wake of terrorist bombings in Bombay in March 1993--widely believed in India to have been instigated by Pakistanis--and stepped-up activities among Kashmiri militants, Indian politicians and the media reveled in the possibility that the United States might declare Pakistan a practitioner of state-sponsored terrorism. Washington's decision in July 1993 not to declare Pakistan a terrorist-supporting state displeased many prominent Indians, and Indian political analysts accused the United States of having a "double standard" in regard to specific states sponsoring terrorism.
Military cooperation also grew. Exchanges of senior military officials became frequent, a high-level bilateral conference on regional security affairs was held, and Minister of Defence Sharad Pawar journeyed to Washington in April 1992 to discuss arms supplies and military technology. Not only did United States navy ships make occasional ports calls in India, but the two navies conducted their first-ever joint exercise in May 1992. Indian officials came to have a greater appreciation of United States interests in maintaining a military presence on Diego Garcia and in the Persian Gulf.
In 1993, India and the United States appeared committed to improve relations and bilateral cooperation despite differences over India's refusal to sign the Treaty on the Non-Proliferation of Nuclear Weapons and to participate in discussions with the United States, Russia, China, and Pakistan on establishing a South Asian nuclear-free zone. Nevertheless, Washington directed its efforts to creating a climate of restraint between New Delhi and Islamabad in order to freeze or roll back their nuclear weapons programs. However, India and the United States remained wary of each other's long-term strategy regionally and globally.
Some Indian political analysts criticize the United States for following a "two-track policy." On the one hand, Washington has supported New Delhi's economic reform and has facilitated international loans to India, but, on the other, it has relentlessly pursued an agenda to force India's accession to United States nonproliferation goals and has used human rights issues to try to force India to meet Washington's political objections. Moreover, many Indians have expressed worries that, with the emergence of the United States as the sole superpower, and as the leader of a Western-dominated coalition after the Persian Gulf War, Washington might attempt to impose its own standards for democratic values, human rights, and free markets. India fears that a United States vision of a new world order not only would hurt the interests of Third World countries economically and politically, but also would damage India's drive to become a leading power in a multipolar system. Washington's decision not to place Pakistan on its list of nations that sponsor terrorism and its successful efforts in getting Russia to cancel the sale of cryogenic engines to India are seen as detrimental to good Indian-United States relations.
In the midst of increasing anti-United States political rhetoric and newspaper headlines, Indian and United States officials have seemed to agree on only one thing, that bilateral relations had reached their lowest point in two decades. Observers in both countries believe that the administration of President William Clinton places a low priority on relations with India despite the fact that the United States has become India's prime trade partner. Against this backdrop, Prime Minister Rao visited the United States in May 1994 for an uneventful round of talks with President Clinton, who encouraged India's economic reforms. Six memorandums of understanding were signed with the intent of expanding official contacts, reviewing and updating a 1984 understanding on high-technology transfer, enhancing defense cooperation, stimulating bilateral ties, and establishing a business partnership initiative.
High-level visits to India in early 1995 portended greater stability in India-United States relations. Secretary of Defense William J. Perry visited New Delhi in January to sign a "landmark agreement" on military cooperation that was seen by some local observers as a convergence in India-United States security perceptions after nearly fifty years of divergent viewpoints (see National Security Challenges, ch. 10). Following the Perry visit was a commercial mission led by Secretary of Commerce Ronald H. Brown that also occurred in January. Agreements signed by Indian and United States businesses during the visit resulted in US$7 billion in contracts and investments in the communications, health care, insurance, finance, and automotive sectors. Some of the deals consummated were intended to build the infrastructure needed by foreign firms to do business in India. In March 1995, Hilary Rodham Clinton, the wife of the United States president, toured India as part of an extensive South Asian goodwill tour. In April, Secretary of the Treasury Robert E. Rubin visited New Delhi to sign a bilateral investment protection treaty reflecting the substantial increases in United States investment in India since 1991 and Washington's encouragement to India to apply for Agency for International Development loans.
From the late 1940s to the mid-1960s, independent India's most important relationship was with Britain. New Delhi and London had special relations because of common historical ties, political institutions, interest in economic development, high levels of trade between India and Britain, and British investment in India. Despite this special relationship, Nehru's policy of nonalignment was designed, in part, to prevent India from becoming too dependent on Britain and other former colonial powers. In spite of cooperation with Australia, Britain, and Canada in the Commonwealth of Nations--which was established by Britain in 1931--India's nonaligned stance frequently put India at odds with Britain, the United States, and other Western countries on Cold War and anticolonial issues (see Commonwealth of Nations, this ch.). Nevertheless, common democratic principles and the willingness of the developed countries to provide economic assistance prompted India to build modest but constructive relations with these countries.
India's relations with Britain remain important. India has so successfully diversified its economic ties that London's domination is no longer a consideration for New Delhi; British trade, investment, and aid, however, are still significant. A substantial community of people of Indian origin live in Britain, contributing to the business and intellectual life of the country. Economic relations were improving in the early and mid-1990s with the implementation of India's economic reforms. Political differences stemming from India's nonaligned stance tended to dissipate with the end of the Cold War and the collapse of the apartheid system in South Africa.
From the mid-1960s until the early 1980s, the difficulties encountered in conducting trade and investing in India caused countries such as Japan and the Federal Republic of Germany (West Germany) to seek more fruitful commercial opportunities elsewhere in the developing world. In the sphere of international politics, the intricacies of balancing ties with India and Pakistan, India's tilt toward the Soviet Union beginning in 1971, divergent views on nuclear proliferation issues, and the situations in Afghanistan and Cambodia left little room for improvement of relations with Japan and Western Europe. Modest moves taken to liberalize the Indian economy in the early and mid-1980s and increased availability of private investment and official developmental assistance from developed countries, however, provided India with the opportunity to increase trade and obtain aid and investment from Japan and Europe. Indian trade with countries of the European Economic Community rose dramatically, and Japan became India's largest aid donor. By the late 1980s, Indian, West European, and Japanese leaders exchanged regular visits.
In the early 1990s, expanding Indian exports and attracting investment from developed countries became a major priority in India's bilateral relations. India developed closer ties with Berlin--now the capital of a united Germany--Tokyo, and the European Economic Community (later the European Union) to promote Indian economic interests and enhance its diplomatic maneuverability. Japan remained India's major source of bilateral assistance, and Berlin was New Delhi's largest trading partner in the European Economic Community. Nevertheless, India and the developed countries had differences over security and nuclear issues and the attachment of political criteria to developmental assistance.
Relations with Australia suffered in 1990 and 1991 as India expressed its displeasure with Australia's sale of Mirage fighters to Pakistan. In 1991 the German government announced it was cutting official aid to India because of "excessive armament," while the British, Canadian, and Japanese governments warned India that future assistance would be cut back if India did not curtail its high levels of military spending, which the developed countries contend suppressed economic development. In addition, Britain, France, and Germany also increased pressure on India to sign the nonproliferation treaty, and France cautioned India that any future agreements to supply India with nuclear material and technology must adhere to "full-scope safeguards" to prevent diversion to nuclear weapons production. Finally, India remained concerned that developed countries would impose human rights conditions as criteria for economic aid.
During the Cold War, India's participation in the UN was notable for its efforts to resist the imposition of superpower disputes on UN General Assembly debates and to focus international attention on the problems of economic development. In the early 1950s, India attempted unsuccessfully to help China join the UN. India's mediatory role in resolving the stalemate over prisoners of war in Korea led to the signing of the armistice ending the Korean War. India chaired the five-member Neutral Nations Repatriation Commission while the Indian Custodian Force supervised the process of interviews and repatriation that followed. The UN entrusted Indian armed forces with subsequent peace missions in the Middle East, Cyprus, and the Congo (since 1971, Zaire). India also served as chair of the three international commissions for supervision and control for Vietnam, Cambodia, and Laos established by the 1954 Geneva Accords on Indochina (see Peacekeeping Operations, ch. 10).
Although not a permanent member of the UN Security Council, India has been elected periodically to fill a nonpermanent seat, and during the 1991-92 period served in that capacity. In the early 1990s, New Delhi supported reform of the UN in the hope of securing a permanent seat on the Security Council. This development would recognize India's position as the second-largest population (possibly the largest in the early twenty-first century) in the world, with an economy projected by some to become the fourth largest, after China, the United States, and Japan, by 2020.
India also has served as a member of many UN bodies--including the Economic and Social Council, the Human Rights Commission, and the Disarmament Commission--and on the board of governors of the International Atomic Energy Agency. In addition, India played a prominent role in articulating the economic concerns of developing countries in such UN-sponsored conferences as the triennial UN Conference on Trade and Development and the 1992 Conference on the Environment and Development in Rio de Janeiro.
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