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India, Trump and the future matrix

Ashok Malik is senior fellow, Observer Research Foundation. He can be reached at malikashok@gmail.com
Published : Nov 13, 2016, 1:50 am IST
Updated : Nov 13, 2016, 1:51 am IST

It is important to understand that Mr Trump has not killed globalisation or international trade.

US President-elect Donald Trump. (Photo: AP)
 US President-elect Donald Trump. (Photo: AP)

How will a Donald Trump presidency be for India? Unfortunately there have been only feeble attempts to answer the question in our media, which has focused so much in the past few days on what individual writers and editors think of the new White House resident. Important as such sentiments are, they are also irrelevant. Neither are the street protests against Mr Trump — an understandable, lingering finale to a long, bitter and closely-fought election campaign — going to change the reality that India and the rest of the world will have to deal with a new leader in Washington DC.

Before that, some context. There is talk of the Trump victory being “unprecedented”. True, the manner in which an outsider candidate not only took the Republican nomination but actually won is very unusual. Yet, there is nothing unprecedented about Mr Trump’s political positioning. He has little patience for multilateralism, but then for much of its history the United States has not. It bought into the multilateral system only in the postwar era, after 1945.

Earlier attempts at getting the US to engage and underpin global institutions, such as by President Woodrow Wilson after World War I, were thwarted by influential members of the Senate, representing constituencies not dissimilar to Mr Trump’s. Historically, more than through multilateralism, America has sought to demonstrate its exceptionalism through either isolationism or unilateralism, or at best ad hoc coalitions of a few. With the collapse of the postwar multilateral system, those instincts are back.

It is important to understand that Mr Trump has not killed globalisation or international trade. Those currents were already under threat, because they were no more suiting key international stakeholder powers. Rather than the cause, Mr Trump is the symptom of this phenomenon — and the beneficiary. World trade was falling anyway. For the US, 2015-16 has marked the first period of economic growth since World War II when the country’s international trade has declined. This is the scenario that Mr Trump has inherited and been elected in.

What does it mean for India? While not as much as China, India was a massive gainer of the international trading order set up with the inauguration of the World Trade Organisation in 1995. Its gains were in services, rather than manufacturing, but were nevertheless impressive. That phase is over. The WTO now resembles a League of Nations type institution in premature decline. When the liberal trading order comes back — in 15 years, maybe 25; nobody knows — the world may well need a successor to WTO.

Having said that, India was a late claimant to the high table of the postwar order. If that order is crumbling, and if the Trump ascendancy catalyses that process, India can only gain. Any future matrix will need to factor in 21st century power realities, and India’s relative prominence.

Yet, that is for the long term. What of the immediate? Mr Trump’s voters have little patience with international trade agreements, which they see as depriving American workers of jobs. They identify China as the principal winner in the erstwhile liberal trading order as well as the rising challenger power. Consequently, they demand a muscular strategic response to China.

Admittedly President Barack Obama too was alive to the China problem. He sought to address it through the Pivot to Asia, which had two components. The first was a military and maritime component, involving a redeployment of US naval assets in the Indian Ocean region and associations with friendly countries such as India. The second was a trade compact — the Trans-Pacific Partnership — that would set standards to initially target China and then serve to mainstream it into international trade best practices, away from a predatory pricing approach.

Mr Trump is likely to pick and choose from Pivot to Asia. He has promised to bury TPP, recognising there is little popular stomach for a new trade regime. This will give India, which stayed out of the TPP talks and would have been hurt by its introduction, breathing room. India is negotiating its own economic integration with Asia by way of the Regional Comprehensive Economic Partnership: a mega-trade deal it is discussing with Asean and its partners.

RCEP and TPP are separate arrangements. However, they have common members. The higher TPP benchmarks are being pushed onto RCEP by some of these countries. With TPP no longer an inevitability, RCEP can go back to a more “normal” negotiation. India will still need to compromise, but without the TPP gun being held to its head.

As in the manner of the early Cold War warriors of the 1950s, Mr Trump’s answer to Chinese expansionism will be based more on a militaristic doctrine rather than a socialisation of China. He could well urge greater military capacities for South Korea and accelerate Shinzo Abe’s quest for Japanese remilitarisation — by in fact allowing the Japanese Prime Minister to present this proposal to his people as an American request. None of this would be detrimental to India.

Another foreign policy goal before Mr Trump is to take on Islamist radicalism and terrorism, which he identifies as the chief ideological threat to the US. In this he is expected to narrow down on the Islamic State and if necessary make common cause with the Assad family in Syria, Vladimir Putin in Russia and the Iranians, all of whom oppose the IS.

If so, this should temper his election-time rhetoric against President Obama’s nuclear deal with Iran. It also means he will reach out to Mr Putin, possibly overlook the Russian leader’s excesses in the Crimean region — of course Mr Trump’s European allies will not be happy with that — and attempt to prise Russia away from the Chinese grasp, to the degree it is possible.

On Afghanistan and Pakistan Mr Trump will make all the right noises, but one doesn’t see him reversing the withdrawal of American troops. Indians may be disappointed by this but they have to use the cards they are dealt. India’s Pakistan policy is today virtually a subset of its China policy. As such if China faces serious competition for Russian affection and if it is determinedly challenged by capacity enhancement of regional rivals in East Asia, this will give India opportunities nearer home.

Tags: donald trump, woodrow wilson, wto