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Modi, Obama take defence ties to advanced stage

Prime Minister Narendra Modi wound up his five-day visit to the US on Tuesday night with an agreement with US President Barack Obama to renew the 2005 Framework for US-India Defense Relationship for another 10 years taking strategic ties between both countries to an advanced stage. India and US also agreed to set up an institutional mechanism to boost investment into Indian capital markets and infrastructure, increase trade between the two countries fivefold to $ 500 billion and resolve issues related to intellectual property rights through talks.

During the first ever summit level meeting between both leaders that went on for over 110 minutes, Modi and Obama decided to give a fresh lease of life to the Political-Military Dialogue in an effort to develop a robust platform for co-production of defence items.

“To facilitate deeper defense cooperation, they welcomed the decision to renew for ten more years the 2005 Framework for the U.S.-India Defense Relationshipand directed their defense teams to develop plans for more ambitious programs and activities. The two leaders also agreed to reinvigorate the Political-Military Dialogue and expand its role to serve as a wider dialogue on export licensing, defense cooperation and strategic cooperation,” said the joint statement.

Additionally, both sides also decided to boost maritime security to ensure freedom of navigation and movement of shipping and commercial activity.

“To achieve this objective, the two sides considered enhancing technology partnerships for India’s Navy including assessing possible areas of technology cooperation. They also agreed to upgrade their existing bilateral exercise MALABAR.”

The two sides also agreed to jointly address the issue of terror by dismantling the havens of Al Qaida and Dawood Ibrahim, wanted for masterminding the 1993 serial bomb blasts in Mumbai.

To boost investment by institutional investors and corporate entities, Modi and Obama promised to establish a joint investment initiative, led by the Indian finance ministry and the US Department of Treasury. The initiative will focus on capital market development and financing infrastructure.

Besides, an infrastructure collaboration platform will be established. The platform, to be convened by the finance ministry and the commerce department, would enhance participation of US companies in infrastructure projects in India, said a joint statement, issued after strategic talks between Modi and Obama.

The statement didn’t mention any targeted investment related to infrastructure development. While Japan had agreed to invest $ 35 billion in this segment in India through five years, China had promised $ 20 billion.

Through the next five years, India needs about $ 1 trillion for infrastructure development, 40 per cent of which is to come from the private sector, according to a study by the Confederation of Indian Industry.

In 2013-14, US inflows of foreign direct investment (FDI) into India were the fifth-highest ($ 806 million), after Mauritius, Singapore, the UK and Japan. However, this was lower than over $ one billion that India received from US in 2009-10, 2010-11 and 2011-12 each.

Before leaving for Frankfurt en route to New Delhi , Modi also addressed the US-India Business Council (USIBC, urging top US companies to expand their base in India before “it is too late”.

USIBC told him it had identified investment of $ 41 billion by its members in India, through the next three years.

Modi told USIBC in the next six months, he would effect all that was necessary to ease the business environment in India.

On Wednesday night, Modi returned to the national Capital on a Special Air India plane after a five-day visit to the US. Union Minister Ram Vilas Paswan and a few of his ministerial colleagues were present at the Palam Technical area to receive Modi, in a departure from normal practice where ministers no longer line up to see off or receive the Prime Minister during his foreign trips .

Modi and Obama committed themselves to promoting an environment attractive for companies to invest and manufacture, through the Trade Policy Forum. Amid differences over intellectual property rights, the two sides promised to set up an intellectual property working group, as part of the forum.

Modi invited US industry to be the lead partner in developing smart cities in Ajmer, Visakhapatnam and Allahabad. India plans to develop 100 smart cities, for which an allocation of Rs 7,060 crore was proposed in the Union Budget.

The two sides also established a contact group on civil nuclear energy cooperation to deliver electricity from US-built nuclear power plants in India.

“They looked forward to advancing the dialogue to discuss all implementation issues, including, but not limited to, administrative issues, liability, technical issues and licensing to facilitate the establishment of nuclear parks, including power plants, with Westinghouse and GE-Hitachi technology,” the joint statement said.

Obama affirmed India met the requirements of the missile technology control regime and was ready for membership to the Nuclear Suppliers Group (NSG). He also supported India’s membership to the Wassenaar Arrangement and the Australia Group.

To tackle climate change, India and the US signed a memorandum of understanding (MoU) to provide up to $ 1 billion to aid India’s transition to a low-carbon and climate-resilient energy economy. The MoU was signed between Export-Import Bank and the Indian Renewable Energy Development Agency.

Other initiatives include a new programme to scale up renewable energy integration into India’s power grid and setting up the Clean Energy Finance Forum to promote investment and trade in clean-energy projects.

Both leaders said they were committed to working towards a successful outcome of the 2015 UN Framework Convention on Climate Change in Paris.

Given the current logjam in World Trade Organization (WTO) talks, owing to India’s tough stance on food security, the two sides directed their officials to hold talks with each other, as well as with other WTO members, on steps in this regard.

With the threat of the Islamic State looming large, Obama and Modi underlined the need for continued global efforts to combat and defeat terrorism.

“The leaders stressed the need for joint and concerted efforts, including the dismantling of safe havens for terrorist and criminal networks to disrupt all financial and tactical support for networks such as Al Qaida, Lashkar-e Taiba, Jaish-e-Mohammad, the D-Company (the network of Dawood Ibrahim) and the Haqqanis,” the joint statement said.

The two leaders reiterated their call to Pakistan to bring the perpetrators of the November 28 terrorist attack in Mumbai to justice.


‘THANK YOU AMERICA…’

… is what Prime Minister Narendra Modi said, as he concluded his five-day visit. A snapshot of the agreements between the countries

  • To intensify cooperation in maritime security; important as China’s maritime ambitions expand
  • Both leaders express concern about rising tensions over maritime territorial disputes
  • Obama promises to enhance India’s voice and vote in international financial institutions
  • USAID to support the national urban development mission and Clean India campaign
  • Both sides discuss role US can play in modernising India’s railway network
  • Modi and Obama to hold public-private discussions in early 2015 on new areas of cooperation, including advanced manufacturing
  • To strengthen US-India Partnership to Advance Clean Energy
  • To ease travel between the two countries, India to introduce visa-on-arrival for US citizens in 2015
  • Obama to support Modi achieve his goal of preparing young Indians for 21st century jobs
  • Leaders commit to partner on the Digital India initiative
  • To launch new phase of programme to develop affordable vaccines for dengue, malaria and tuberculosis
  • New pact likely soon to support the Nasa-Isro Synthetic Aperture Radar mission, to be launched in 2021

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