Where India stands to gain (and lose) under Trump's presidency

Following the stunning victory by Donald J Trump for the presidency of the United States, the question many Asian Indians are asking is what kind of an impact this would have on the US-India relationship.

Former US president George W Bush was instrumental in bringing this bilateral relationship to new heights with his open and aggressive advocacy of the Indo-US Civil Nuclear Treaty and created a continuum through the Barack Obama years to further develop and foster the relationship into a strategic alliance.

Trump is not a stranger when it comes to dealing with Indians, and his business undertakings in Pune and Gurgaon are clear evidence of that existing bond. Also, we have witnessed a surge of support for him from the Indian community in the US, spearheaded by businessman Shalabh "Shalli" Kumar, who not only raised campaign funds for the president-elect but also arranged a large gathering in New Jersey in honour of him.

At the outset, one may also wonder whether Kumar, who is said to be having close ties to Sangh Parivar organisations in India, acted alone or with blessings from those power centres!

Regardless, the election of Trump has raised serious concerns among the Indian community in the US which overwhelmingly supported Democrat Hillary Clinton for the presidency.

Although Indian Americans are mostly conservative in their social outlook and not necessarily cleansed of their caste affiliations or prejudicial minds, Trump’s proposals dealing with issues such as immigration and trade have unnerved their senses.

Also, many seem to have justifiable apprehensions on the possible rise of the far right movements that could threaten their safety and the economic stability of their children. 

Although some of those concerns are beyond the pale, the just concluded election has its consequences not only for the community but also for the US-India relationship, especially when it comes to trade and immigration.

Trump’s "America First" populist slogan was a shot across the bow to globalists and one that was fully embraced by the blue collar workers of the country. There is a widespread feeling in the US, particularly among the white working class, that globalism has decimated the middle class here while creating them in countries like China and India.

Although putting tariff and trade restrictions are anathema to the Republican orthodoxy, Trump may try to renegotiate many existing business deals that may include trade treaties with India as well.

Trump called the H-1B visa programme as "unfair" and criticised Clinton for her support for outsourcing of jobs. Although H-1B was designed to provide a temporary workforce, there were widespread allegations of abuses that may have resulted in American labour being supplanted by many of those foreign temporary workers.

With Alabama Senator Jeff Session in line to take charge of the justice department as the future Attorney General - considered more hawkish on immigration issues - we may see a limit on H-1B entries and new guidelines for a stricter adherence to the law. 

However, it could also be a boon for India where these technical hands may experiment with their ideas in their homeland rather than in the Silicon Valley where 44 per cent of startups have an immigrant founder.

India’s software services accounted for $82 billion worth of exports to North America in 2015 and only time will tell how adversely the incoming Trump administration would impact it. 

Trump has promised to reform the tax code and is calling for a tax reduction down to 15 per cent for the corporate sector. He has vowed to bring offshore deposits of multi-national corporations back to the US to revitalise the economy and to rebuild infrastructure.

If he succeeds with his proposals in the Congress, that will tantamount to a paradigm shift in tax policies resulting in a friendlier ecosystem for business in the US especially in the area of manufacturing. 

That could reduce the appetite for many businesses to jump on the bandwagon of the "Make in India" push by Prime Minister Narendra Modi. Trump is already under pressure to stop the Obama administration’s efforts to strike a deal to build F-16 Fighting Falcons and F/A-18 Super Hornets in India to replace an ageing fleet of Russian-made fighters.

In the area of foreign policy, India may stand to gain as Trump has repeatedly slammed China for its monetary policies and unfair trade practices. His recent conversation with Taiwanese president Tsai Ing-wen was not seen as an accident but probably setting a new tone for his administration.

Trump may carry on with Obama's policies of increased cooperation with India in the strategic and defence areas as a bulwark against an aggressive and menacing China in the Asian theatre.

Trump’s tough stand against Islamic radicalism may also play into the hands of India as Pakistan has become a hotbed of terrorism and stands to lose billions of dollars in aid with a change in policy.

However, there is little doubt that with continuing US involvement in Afghanistan, Trump may not have much flexibility to punish Pakistan for its protection of terrorist elements in its backyard that are creating havoc across the border with India.

Trump’s attitude towards Vladimir Putin, president of Russia, and his willingness to cooperate with the Cold War rival may lessen India’s concern arising from the threat of ISIS or similar threats.

In an interview with Forbes India, while launching his Pune project in 2014, Trump had said India had become a "top place" in the international rollout of his property empire.

Overall, the US president-elect has shown a positive approach to India and let us hope he will continue to build on the improved relationship promoted by two successive presidents before him.

Also read: Why India must keep a hawk's eye on Donald Trump’s Iran policy