Tag: usa

India relies on a friendly USA for progress and peace – but Trump is making this difficult

INTO INDIA last month asked this question – can the USA-India releationship survive President Trump?

This month the answer is even less certain.

New Delhi has some fears on this front – knowing that India’s growing economy and innovation needs a friendly USA. Even more so, the India-USA relationship is a key to ensuring an Asia NOT dominated by China.

India wants agreement with the USA.

Without some effort from Washington, India will just have to find new relationships to secure its position in Asia.

 If India and the United States become more distant to each other, both would have a weaker hand to play when it comes to China.

India is anxious to reduce its reliance on China as a source of supply and also its reliance on the USA as a source of demand.

Trump is softening his approach to China while he goes harder on India.

There are serious levels of concern in New Delhi about this.

First, the China border problem continues to fester.

Second, both the USA and China are moving closer to Pakistan = which is also a volatile border for India.

Corporate India seems to have made up its mind – several of India’s largest corporations are seeking a presence or partnerships in China.

But political India continues to look for new friends.

Is India the new China?

The stunning economic rise of India is causing a re- think – in 2023, India’s GDP was US$14.54 trillion, the world’s fourth largest economy, behind the United States, China and the European Union.

But what is prompting a rethink by many countries is India’s annual GDP growth of 7.6% – now outstripping all those other countries. India could match China’s 2023 GDP of $34.64 trillion in 14 years. On top of the growth rate advantage, India’s population overtook China’s in 2023, and the “demographic dividend” is kicking in.

This growth comes with an interesting twist, no doubt occupying minds in Washington and Beijing.

India’s military expenditure is now third behind the US and China.

When it comes to regional security in the Indo-Pacific region, India now counts as a major player. In addition to defence spending, location of this large landmass (the world’s seventh largest) means India is pivotal to trade routes crossing the Indian Ocean, as well as being close to China, the preeminent trading nation at the heart of the Indo-Pacific region.

Someone who is well aware of the growing power of India is of course Prime Minister Narendra Modi, a strong leader who stands as an equal with Chinese President Xi Jinping and soon-to-be President of the USA, Donald Trump.

The big question for countries like Australia and New Zealand is where do we fit in with this new scenario, who is listening to us, what does emerging “multi-lateralism” (championed by India) mean for us and how can future trade be assured?

Our diplomats and trade people are well placed and respected in New Delhi – but as the position of India becomes stronger, the diplomatic skills of both Australia and New Zealand will be needed to define our place in what is a new order.

Thanks to Chris Ogden, Associate Professor in Global Studies, University of Auckland, Waipapa Taumata Rau, for some of the above data.