Biden’s America

With Donald Trump finally in exit mode and US President-elect Joe Biden having picked key members of his administration, it is very likely that the US will reset its economic and strategic equations with Asia and Europe in particular. Democrats are known to be interventionist in world affairs, and if the Biden administration is being dubbed as ‘Obama Mark 3’ that interventionism can be expected to continue — with a special focus on a ‘pivot to Asia’ in the face of the Chinese threat, apart from rearranging the chessboard in the West Asian region. It must be said, though, of the Trump years that it was marked by efforts to disengage in Afghanistan, Iraq and even Syria, even though the US-Iran nuclear deal was effectively consigned to the rocks. The US can be expected to rework the nuclear pact with Iran, particularly in view of China’s moves to win Iran into its fold with huge investments. A normalisation of ties with Europe is virtually a given, in view of the extent to which Trump had gone to rock old alliances and multilateral forums, such as NATO, World Health Organisation, World Trade Organisation and the UN dialogue on climate change. The Biden camp has already indicated that the US will rejoin the Paris accord, which not only marks a major advance in efforts to battle climate change, putting pressure on fossil fuel polluters such as Australia, but also signifies a boost for renewables industry and technologies the world over. The Trans Pacific Partnership is likely to be resurrected to take on the China-led Regional Comprehensive Economic Partnership — once again placing India in an intriguing situation.

However, there is much that may not change for the better as far as India is concerned. The US, whether Democrat- or Republican-led, has resisted special and differential treatment to the developing world on issues of trade and climate. The Doha Declaration has become more germane than ever in the context of the pandemic, with India and South Africa arguing for a waiver of intellectual property; it is hard to be sanguine about US’ response. India’s neighbourhood is likely to remain troubled as always. A softer stance on H-IB visas may be offered as a concession to the Indian-American supporters of this regime — but too much cannot be expected in view of rising unemployment in the US. Multilateral transfers to pandemic-hit countries may increase; the envisaged $500 billion issue of Special Drawing Rights, shot down by Trump, could improve the finances of debt-strapped developing countries. Inexplicably, India had approved of Trump’s move.

The pandemic has upended fiscal conservatism, with a focus on doing what it takes to lift businesses and workers. The US is no exception. This effort could lift the world economy, even if gradually. India’s not a top priority in Washington but will be more important than ever before because of China.

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