India and Trump

Many parts of the world are apprehensive of what a Trump presidency means for them — but that need not include India. Donald Trump’s campaign speeches were not kind to some religious and ethnic denominations, but that, by and large, did not include Indians. His campaign speeches were peppered with praise for India, Prime Minister Narendra Modi and the 3.2 million-strong Indian diaspora. This gives India a springboard to reach out to the president-elect and establish a rapport with his team, apprising them of areas of opportunities and concern. The Prime Minister recently observed that Trump was inclined to be friendly towards India. He could have added that India perhaps had more to fear from a Hillary Clinton win. In fact, Trump is likely to view India independently as a region of opportunity rather than hyphenate it with Pakistan, as an influential section of the US political establishment tends to do. If Trump pursues his intent of improving ties with Russia and containing China’s rise, it cannot do India any harm. That he considers Pakistan to be the world’s most dangerous country, apart from Iran, suggests that he is not in favour of lending an unconditional line of support to Pakistan in order to maintain stability in Afghanistan. India’s strategic and defence-related engagements with the US are unlikely to suffer in this scenario.

However, it is in trade in services that India is ill at ease. Trump has blown hot and cold on H1-B work visas where India corners over 70 per cent, or 65,000, of all such visas issued annually. The US receives about two lakh H1-B applications from all over the world, India included. While imposing high costs on Indian hirings, Trump’s team would perhaps be quick to realise, as his predecessors did, that substituting Indian skills in software with US labour is easier said than done. The jobs crisis in the US is more on account of the export of manufacturing jobs to China; the redundant blue collar workforce in the US cannot readily be adjusted into the IT sector. The same holds true for L1 work visas issued for high-end science and technology operations, where India accounts for 30 per cent of such visas issued.

Another huge unknown is Trump’s position on IPRs. India should engage the new administration on the nuances of IPR and its effort to balance public concerns and commercial interests within the WTO framework. Trump’s opposition to trade pacts such as the Trans-Pacific Partnership for their propensity to export jobs from the US, comes as good news to India, since it faces the prospect of losing market access to Asia-Pacific countries that are part of the TPP. This could positively influence India’s bargaining position at the Regional Comprehensive Economic Partnership. However, it remains to be seen whether the new administration slaps a levy on firms operating overseas. In all, the businessman in Trump is likely to buy into India, provided India makes the right pitch.

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