India for sale

November 16, 2010

Pranav Jani writes from New Delhi on the meaning of Barack Obama's visit to India.

WITHIN THE span of a few days in India, Barack Obama accomplished two important objectives for the U.S. ruling class: (1) opening up India even further as a market for U.S. exports, from airplanes to turbines to motorcycles, and (2) securing the diplomatic and military ties with India to make it a stronger ally for defending U.S. might, especially in Asia.

In successfully pulling off this agenda, Obama was aided and abetted by Indian elites themselves, as capitalists and politicians fell over themselves to sell Indian sovereignty at a good price.

Undoubtedly, Obama's visit registered here in other ways as well. All world leaders dutifully pay homage to sites associated with Mahatma Gandhi and nonviolent struggle, but it resonated differently when the first African-American president of the U.S. took those well-worn paths. I don't suppose that when George W. Bush visited India in 2006, he received, as Obama did, a copy of Jyotiba Phule's Slavery, an 1873 book against caste oppression that is dedicated "to the good people of the United States as a token of admiration for their sublime, disinterested and self-sacrificing devotion in the cause of [abolishing] Negro Slavery."

President Obama with Manmohan Singh during his visit to India
President Obama with Manmohan Singh during his visit to India (Samantha Appleton)

The historic symbolism of the Obama presidency forcefully emerged in India, encouraging stories in the press about Martin Luther King's visit to India in 1959 and the warm welcome he received from a population that had closely followed the Montgomery Bus Boycott.

But these legacies of solidarity were twisted in order to facilitate the geopolitical interests of the guest, as well as the host governments and ruling classes. The language of peace and nonviolence was deliberately used to shore up India's support for the "war on terror," despite Indian reservations about the wars in Iraq and Afghanistan. Rhetoric about international brotherhood laid the groundwork for future diplomacy in the UN, where the U.S. hopes to get Indian support for its policies on Israel and Iran.

And then there was the naked corporatism. It was ironic that Obama was presented with a gift--model of a charkha (spinning wheel)--that was Gandhi's symbol of anti-industrialism and economic self-sufficiency. Obama, after all, came to India with an army of 200 CEOs, met with representatives of India Inc. in both Mumbai and Delhi, and left after securing tens of billions of dollars of contracts for U.S. companies.

Obama's visit gives a glimpse of the shape that global capitalism is taking today, a decade into the 21st century, combining old features with new ones.

First of all, although the Wall Street Journal and other business papers slobbered over Obama's stirring defense of free-market policies while in India, the visit showed with unerring clarity, yet again, that the "free market" is actually driven by the U.S. state and its military and diplomatic power.

Secondly, the deliberate overtures to Indian business reveal how much the crumbling economic system in the U.S. requires countries like India. Despite a protectionist backlash in the U.S, India, as a place with growing consumer capacity and wealth, can suck up U.S. exports and, according to Obama, help create jobs.

Finally, the complete support for this plan from Indian capitalists and politicians gives us a sense of how willing they are to subscribe to neoliberal policies that continue to accelerate the class gap in their country while bringing in vast amounts of wealth to the tiny elite at the top.

Behind the eloquence of Obama's speeches the cynical message was crystal clear: if Gandhi can be used to sell India and proliferate weapons, so be it.

LET'S GO into the details of these different aspects of the U.S.-India agreements in order to get a sense of the larger stakes and dynamics involved.

First, the business contracts. As the Wall Street Journal reported, citing the White House directly, the business deals were worth around $15 billion and would create and support over 53,000 jobs in the U.S.

Military contracts included a massive one between Boeing and the Indian Air Force for 10 C-17 military transport aircraft, and a deal between General Electric and the Indian Aeronautical Development Agency to support light combat aircraft and pave the way for more high tech aeronautical exports. Boeing and GE struck it rich again on the commercial front, making deals with SpiceJet for 737s and Reliance Power for turbines to run its 2,500-watt power plant in Samalkot, Andhra Pradesh.

The deals opened the way for diesel locomotives for Indian Railways, a Harley-Davidson motorcycle plant, mining equipment for the 3,960-megawatt coal-fired Sasan power plant in Madhya Pradesh (also owned by Reliance Power), surveillance software for the Maharashtra police and trace explosive detection equipment for the Indian Army.

Indian hospitals in "second- and third-tier cities" will be able to purchase secondhand hospital equipment from U.S. hospitals, and Indian VIPs, long suffering without appropriate helicopters, will now be able to purchase state-of-the-art Bell helicopters. The U.S. Export-Import Bank has been quite active, lending money to both U.S. and Indian companies in order to make the deals work.

Crucial to these deals was Obama's promise that the U.S. will end India's nuclear isolation by removing restrictions on the export of advanced technology to key Indian institutions that had been included on the Entity List, a designation for organizations the U.S. believes have added to the risk of spread of weapons of mass destruction programs.

In India, these entities have included the Department of Atomic Energy, the Defense Research and Development Organization, and the Indian Space Research Organization. These groups would now be able to acquire the cutting-edge technology that was denied to them after the 1980s, especially after the 1998 Shakti nuclear tests.

And Obama kept promising that there was more to come. He told the U.S.-India CEO Forum, a group started after Bush's 2005 trip to India, that he wanted to double U.S. exports to India in five years (it's only 2 percent of all U.S. exports now) and to lower barriers between the countries in all areas of the economy. He said that there was no reason why India, now number 12 on the list of U.S. trading partners, couldn't be the first, pointing out that even the Netherlands was ahead.

IN TERMS of spin, the rhetoric on both sides was the same: these deals are a win-win situation for both countries, and the more trade the better.

Holding out the number of U.S. jobs created at every step, Obama directly attacked the "caricature of India as land of call centers and back offices," or the view that U.S.-India trade is "just a one-way street of American jobs and companies moving to India."

Let's pull back the layers here. Certainly, we can welcome Obama's criticism of the xenophobia and racism against India and China in the face of U.S. job losses to globalization. But let's remember that he himself helped stoke that rhetoric in past comments, as when he talked about Buffalo losing jobs to Bangalore.

The Indian information technology companies loved what the Indian media dubbed as Obama's "backflip" on outsourcing. But the deeper truth was stated by the Indian Prime Minister Manmohan Singh in words that Obama could never say: "Outsourcing [work to India] has helped improve the productive capacity and productivity of America."

In other words, securing cheaper labor in India has made America better because the shedding of American jobs has helped American companies make more profit at less cost!

The fact that Obama is now emphasizing the other side of the flow--not U.S. companies outsourcing to India, but Indian businesses investing in the U.S.--shouldn't make us believe that now he's taken steps for U.S. workers. What's happening now is simply a reflection of the intensification of the trade relations between the countries. Sections of Indian capital are simply strong enough to create a two-way movement in trade and investment.

On the Indian side, similarly, Singh and the CEOs did all they could to say that all of these imports were good for the Indian people and their progress. Singh stated directly: "India needs an investment of more than a trillion dollars in the next five years for its infrastructure development projects. We need American contribution in fulfilling the ambition of ours." But Singh was using "development" in the same way that Obama was using "jobs"--as a way to turn the "win-win" for businesses and the government into a victory for the nation itself.

Take, for example, the GE contract for the Sasan power plant. As in every single one of these mega-development projects in India, the land for the power plant had to be secured through the displacement of farmers and the takeover of forest lands.

Though Reliance Power had won the contract in July 2007, there were some concerns about getting the land as movements and agitations in places like Nandigram, West Bengal, against displacement gave more confidence to farmers. By September 2008, even the billionaire Mukesh Ambani, was having his dream of a mega-Special Economic Zone in Mumbai challenged by a farmers' movement (which eventually prevailed).

This forced Reliance Power--run by Ambani's younger brother--to announce that the Sasan plant was on, that the "project-affected families" had accepted their "relief and rehabilitation packages" and begun leaving the land. Soon, Reliance Power also acquired the rest of the necessary 1,700 acres of land from the government, of which 900 acres was forest land.

But these tales of farmer displacement, environmental damage, and the accelerated gap of rich and poor in India--caused precisely by the kinds of anti-people development projects enabled during the Obama visit--didn't make the front pages.

LET'S LOOK also at the political agreements made during the Obama visit, intertwined with these business dealings. The press conferences and joint statements revealed the long-term strategic interests in U.S.-India relations. The U.S. wants to enlist India to support its foreign policy with regard to a whole host of countries--including Afghanistan, Iran, Israel and Myanmar. Obama expertly massaged and coddled Indian desires to be recognized as a world power in order to make this happen.

Obama's first step was to publically sympathize with Indians on the events known here as "26/11," the terrorist attacks in Mumbai on 26 November 2008 that left more than170 dead. Speaking from the Taj Hotel, one of the key sites of the attacks, Obama portrayed Indians and Americans as common victims of terrorism and, therefore, natural allies in the war against terror. Indian dissatisfaction with Obama's refusal to name Pakistan as the place where the 26/11 attacks were planned evaporated when, in his address to the Parliament later in his visit, Obama did so.

Under this rubric of "shared values and increasing convergence of interests," all else could be justified. Besides the massive weapons purchases, the joint U.S.-India statement showed India prepared to toe the U.S. line on virtually every matter, intensifying its relationship with the U.S. on all levels. The immediate context for this is India's two-year stint on the United Nations Security Council--beginning January 1--and Obama's announcement that the U.S. will support India's bid of a permanent seat. India is widely seen as being "on probation" during these two years in order to keep U.S. approval.

This means India will have to support the U.S.-led "reconstruction" of Afghanistan despite its refusal to join that war. It will comply with sanctions on Iran, and it will acquiesce with U.S. positions on Israel. Indeed, at the G20 summit in South Korea, India came in strongly on the side of anti-protectionism and "free markets," and we can expect that it will continue to do so. This, of course, is despite the fact that the U.S. will continue to subsidize its own businesses when necessary, as in the agricultural sector.

For its part, the U.S. said nothing about India's human rights abuses in Kashmir, especially in the past few months, during which 111 people have been killed and 3,000 wounded by the Indian army.

Rather, in the latest installment of its ongoing dance between favoring India and favoring Pakistan since the end of the Cold War--depending on its strategic needs--the U.S. showed a clear willingness to link itself with India over Pakistan. In the last few days, the U.S. has made noises to assure Pakistan it isn't in the doghouse, and this will undoubtedly continue as long as Pakistan is needed for the Afghanistan war. But after Obama's visit, it seems quite clear that the U.S. has made a long-term commitment to India as the country in the region that can count on in terms of its military, political, and economic interests.

The discussion of "emerging powers" like India and U.S. reliance on them often raises questions today about whether this is a sign of the demise of the centrality of the U.S. in affairs of the global capitalist system. The joint statements and agreements made during Obama's India visit reveals that we need to think beyond a narrow debate about whether the U.S. is either absolutely central or it is not.

The relationship between the U.S. and India is obviously unequal, as the stronger economic and military power is clearly calling the shots. But the willingness of Indian politicians and capitalists to go along completely with this agenda and the need for the U.S. to seek out such places to export its goods and supports its policies in these times of crisis points, perhaps, to the fact that emerging, sub-imperial powers like India don't need to be "engines of growth" in and of themselves in order to play a crucial role in how the system works.

Those of us who see the disastrous effects of these agreements in both the U.S. and India, of course, need a very different kind of internationalism and solidarity across borders. Building those alliances starts with the recognition that what the U.S. and Indian governments do in the name of their peoples is actually in the interests of their governments and ruling elites.

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