June 12, 2020

The 2020 US elections: What’s at stake for India?

When US President Donald Trump visited India in February 2020, he was riding high. The American economy looked healthy, unemployment was low, and the US Senate had just acquitted him of charges of abuse of power and obstruction of Congress. Just three months later, everything looked different. The global COVID-19 pandemic had resulted in over 100,000 deaths in the United States alone, unemployment had skyrocketed to record levels, and protests triggered by the killing of George Floyd, an African-American man, by Minneapolis police had erupted in over 100 American cities.

The dramatic change in just three months illustrates the unpredictable nature of US politics at an unpredictable time for the world, including for India. It will be all the more reason to carefully observe the US presidential and Congressional elections scheduled for November 2020.

The last four years
Trump’s 2016 election victory over Democrat Hillary Clinton threw up a number of uncertainties for India. The first was how closed or open the US would be on matters of trade, immigration, investment, and technology. The second concerned what approach he would adopt to China: confrontation, competition, cooperation, or confusion. This matter was particularly important because it would have had implications for the wider region and the world at large. The third uncertainty was how he would approach the issue of terrorism, particularly with respect to Afghanistan and Pakistan. And the fourth was what priority he would give to international institutions, and what that would mean for Indian membership and activity.

The Trump administration’s overall approach and Indian engagement with Washington helped to ensure that these areas either witnessed intensified cooperation or that damage was mitigated. The Trump administration’s Free and Open Indo-Pacific strategy, driven largely by a more competitive relationship with China, benefited India in various ways, including in bilateral defence cooperation and higher degrees of strategic coordination. The Trump administration decreased barriers for India to receive sensitive technologies, building upon some of the work done in the last two years of the Obama administration. Coordination on multilateral cooperation and Afghanistan improved, although not without bumps on the road. Occasional difficulties did arise with respect to Pakistan, given Washington’s continued equities; on immigration, although radical reform was limited by logjams in the US Congress; and especially on trade, where India was singled out for its high tariffs. Nonetheless, despite squabbling on the terms of commerce, overall two-way trade between India and the US continued to rise throughout the Trump presidency while the trade deficit in India’s favour narrowed.

Two other complications arose subsequently. The first was the Trump administration’s hardening attitude to Iran, beginning with his unilateral withdrawal from the nuclear agreement concluded by his predecessor Barack Obama: the Joint Comprehensive Plan of Action (JCPOA). The renewal of US sanctions on Iran had implications for Indian energy security. The second complication involved attempts led by the US Congress to constrain Trump’s ability to engage with Russia. The resulting legislation, known as Countering American Adversaries through Sanctions Act (CAATSA) threatened sanctions on countries for major defence agreements with Russia. India, as the largest foreign recipient of Russian defence exports, initially looked like a probable target. At the same time, Trump’s disregard for other countries’ internal affairs meant that the official US response to major changes in India — including the nullification of Article 370, which granted special status to Jammu and Kashmir, and the passage of a contested Citizenship Amendment Act — was relatively muted.

Essentially, Trump’s election had a significant impact on nine issues of importance for India. All will in some sense be at stake in November 2020. On the strategic side, this involved US policy towards China, Russia, Afghanistan/Pakistan, and Iran/Middle East. In terms of bilateral relations, the primary issues relate to trade, immigration, investment, technology, and values.

Republican vs Democratic priorities
A Joe Biden victory would provide relief to India in several areas. Not only would there be more structure and stability to a Biden administration, but the Trump administration’s obsession with redressing trade deficits, curtailing legal and illegal immigration, and isolating Iran will no longer factor prominently in US policy. Indeed, a second Trump administration will likely redouble its efforts to stem immigration, rebalance trade, and harden its stance on Iran, all of which would contribute further to Indian discomfort. Furthermore, a Democratic presidency will put one important but dormant area of cooperation — on climate change, green energy, and sustainability — back on the table with India.

By contrast, other issues might become more of a concern to the present government in New Delhi in the event of a Democratic win. Depending on who occupies key positions in the executive branch of government, we may see under a Joe Biden presidency a return to a more even-handed policy between India and Pakistan in South Asia, although not perhaps to the same degree as the 1990s and early 2000s. A Biden administration, with advocacy from the left wing of the Democratic Party, will also likely be more vocal in its criticism of India for such steps as nullifying Article 370 and CAA.

On other issues — such as investment flows and technology sharing — the consequences of the 2020 presidential elections for India will be less clear-cut. Of these, US policy on China will be by far the most consequential. Trump triggered a trade war that caught Beijing by surprise. Beyond trade, his administration has taken other aggressive steps towards decoupling the US and Chinese economies, including steps on students and technology. At the same time, his withdrawal from the Trans-Pacific Partnership and defunding of the World Health Organisation have been criticised as counter-productive. Democrats have also criticized his administration for cutting spending in areas, such as scientific research and development, that would enable the US to better compete with China. While the bipartisan consensus on China as a competitor has grown in the US, there remain differences between the parties as to how best to compete. Furthermore, constituencies outside the national security, human rights, and intelligence communities — such as those tasked with the economy or the environment — are still likely to advocate engagement and cooperation with Beijing.

Consequently, either a Trump or a Biden electoral victory in November will present the Indian government with both opportunities and difficulties. Despite a good rapport with Trump, who was favourably impressed by his visit to India, difficulties on immigration should be anticipated in the event of his reelection. While Biden will provide greater clarity and bring stability to US policy, a return to more traditional approaches to certain issues with respect to India is possible.

Prediction is premature
Predicting a US presidential election more than three months out is unwise. It is almost certain that Biden will win the popular vote, given Trump’s approval ratings and the fact that Democratic candidates have done so in six of the past seven presidential elections. Winning the Electoral College, which is what really counts, is another matter. The US presidency will be decided by no more than 17 of the 50 US states, and perhaps as few as seven. Trump will hope to retain traditionally Republican strongholds such as Arizona, Georgia, and North Carolina; win swing states such as Florida and Ohio; and surprise in at least one of the traditionally Democratic states that he won in 2016: Pennsylvania, Michigan, or Wisconsin.

Traditionally, incumbent presidents have had an edge in what are otherwise level contests between Republican and Democratic nominees, but the past three elections have thrown up uncertainty. In 2008, Republican John McCain was leading comfortably in polls in August, before the financial crisis of September benefited Democrat Barack Obama. In 2012, Obama enjoyed a comfortable lead that Republican Mitt Romney narrowed following a strong performance in their first debate. In 2016, the polls indicated a Hillary Clinton victory until election day in November. These recent trends suggest that anticipating the outcome of the presidential race before the two parties hold their conventions later this year would be premature.

Don’t forget Congress
Finally, amid the attention focused on presidency, it is often forgotten that the US Congress is also witnessing elections in November. All seats in the House of Representatives are being contested, as they are every two years, with Democrats expected to retain control of that chamber.

The contest for the Senate will, however, be significant. Should Democrats win six of seven closely contested races (Arizona, Colorado, Maine, Michigan, Montana, North Carolina, and Georgia) they would claim a majority in the upper house of the US Congress. This will give the Democrats an opportunity to define the legislative agenda (given control of both chambers), block Trump’s nominations for Supreme Court justices (should he be reelected), and put pressure on Trump in the event of another Congressional investigation into presidential wrongdoing.

For India, the Congressional relationship will remain important given the ability of the US legislature to facilitate or veto important policy. Traditionally, Congress has played a moderating role for India. When relations with the US were frosty, as during the 1980s or after the 1998 nuclear tests, India found advocates for the relationship in Congress. At the same time, when relations were more amicable, Congress often struck a more skeptical note, as when George W. Bush offered a civilian nuclear agreement to India. Regardless, this year’s Congressional elections — particularly the finely-balanced Senate — will matter almost as much for Indian interests as the presidential election.