Amidst the welter of commentaries on the Indian-Russian annual summit last week in New Delhi, what stands out is that the government has outstripped our strategic analysts. The latter viewed the Russian summit last week exclusively through the prism of the $6 billion S-400 missile defence deal. Now, that turned out to be like missing the wood for the trees.
The United States’ Countering America’s Adversaries Through Sanctions Act (CAATSA) stipulates secondary sanctions against countries that enter into “significant transactions” with the Russian defence industry. Our S-400 deal became a celebrated test case. So, when in the face of threats held out by the American side relentlessly, when PM Modi went ahead with the S-400 deal, it stunned onlookers.
The ensuing confusion will take time to wither away. It will take time before it sinks in that US bluster aside, there is no way US will sanction India. The CAATSA is a legislation that the US Congress imposed on a reluctant president in the civil war conditions in US politics to stop him from improving relations with Russia (on which there is bipartisan consensus.) True, secondary sanctions have been imposed on China, but US does not intend to export arms to that country anyway!
But that is not the case with India or Turkey. Despite Turkey’s decision to not only fast track its S-400 deal with Russia and to make advance payments to the Russian manufacturer, US still intends to go ahead with its sale of F-35 stealth fighters. Turks nonchalantly told Washington that if the latter wanted to impose sanctions and annul the F-35 business deal, that’s fine with them, and they’d simply source stealth aircraft from some other country (read Russia). But, no, US still wants the F-35 deal to go through, because F-35 is a highly lucrative super business deal for Lockheed Martin, which hopes to sell to Turkey 100-120 aircraft at over $80 million per piece! In effect, Turkey called the American bluff.
Americans have keen business acumen and will not let go a honeypot like the Indian market. In fact, Modi has taken an even tougher decision to go ahead with oil imports from Iran and to sign up contracts for the month of November, although Trump warned that November 4 would be the cutoff date.
Alas, there is a lack of awareness as to what is happening. Our think tankers weaned on American folklore have been programmed to estimate that Russia is a spent force in global politics. They don’t realize that Americans themselves had no doubts already by the start of the millennium that Russia was on the comeback trail. The high oil prices in 2010-2011 proved a game changer for Russia. It was no coincidence that the first American sanctions against Russia was imposed in 2012 – Magnitsky Act – on human rights issues!
The knowledge of Russian politics and the raison d’etre of India-Russia relations is abysmally poor among Indian analysts. Modi’s strategic decision to revive India-Russia relationship as an anchor sheet of foreign policy is yet to sink in. What Americans know and Modi knows but our think tankers do not yet know is that Russia has not only returned to the global stage as a great power but with renewed capabilities in military technology and with an economy that has survived the western sanctions. The high oil prices in the period ahead will only add to Russia’s income significantly.
If the Americans sanction against India’s use of dollars for its transactions with Russia, make no mistake, Indian and Russian ingenuity will find a way to put in place a clearing system that altogether obviates the use of dollar. Arguably, it will be a blessing in disguise if the US forces India and Russia to revive their old Cold War era payment system, because if that happens, the economic content of the relationship will increase exponentially. Will the US want a major global economy like India to jettison the use of dollar and get accustomed to local currency payments?
Again, the US-Russia-China triangle is today splendidly working for Moscow and Beijing to counter the US, while both capitals retain strategic autonomy and neither seeks a military alliance. India can also be a beneficiary here if the available platforms are optimally used – BRICS, RIC and SCO, in particular. Modi made it clear at last week’s summit that India stands with Russia in strengthening multipolarity. It is a clear rejection of the US’ characterization of Russia as a “revisionist power.” Earlier, at the Shangri La Dialogue in Singapore in June, Modi underscored that India does not regard Indo-Pacific to be a strategy. The import of all this should be very clear except if one insists on holding the American brief on Russia and China. Simply put, India has a lot in common with Russia and China in regard of the emerging world order. Modi’s Wuhan initiative and his visit to Sochi soon afterward suggest that he is open to the idea of India’s Eurasian integration.
Things are looking up for India-Russia relations after the long winter of the UPA rule. For the first time in the post-Cold war era, there are signs that trade and investment between India and Russia is gaining traction. Energy sector is poised to generate massive business volume in a conceivable future. The defence cooperation still remains appreciable – at 62% of India’s arms procurements – despite the atrophy during the UPA rule.
It is sound realism that in a multipolar world, India strengthens relationships with Russia with whom it has common interests in regard of the emerging world order. The army chief Gen. Bipin Rawat’s remarks in the weekend asserting that the S-400 deal is a manifestation of India’s independent foreign policy must be viewed in that light. Last week’s summit averted a real risk of India ending up in America’s “Indo-Pacific” stable as a domesticated milch cow.