As Biden, Modi meet, a flurry of US and India deals

President Joe Biden hailed a new era in the US-India relationship, after rolling out the White House red carpet for Indian Prime Minister Narendra Modi on Thursday, touting deals on defence and commerce aimed at countering China’s global influence.

The partnership is “stronger, closer and more dynamic than at any time in history”, Biden told reporters at a joint press conference with Modi, and the economic relationship is “booming”, with trade more than doubling over the past decade.

“A trade and investment partnership between India and America is important not only for our two countries but for the global economy as well,” Biden said. “We have decided to resolve long pending trade-related issues and make a new beginning,” he added.

Modi touted “a new chapter” to the countries’ “strategic partnership” after the two leaders emerged from Oval Office talks where the countries’ differences on Russia and human rights were on the table.

Washington wants India to be a strategic counterweight to China and sees it as a critical partnership, although some analysts and former officials question India’s willingness to stand up collectively to Beijing over issues such as Taiwan. Washington has also been frustrated by India’s close ties with Russia amid Moscow’s war in Ukraine.

Modi is seeking to raise the influence that India, the world’s most populous country at 1.4 billion, has on the world stage in the wake of strained ties with neighbouring China.

“We have also decided that in the midst of global uncertainties, India and America will, as trusted partners, create reliable, secure and resilient global supply chains and value chains as well,” he said.

For Biden, the benefits of engaging with the world’s most populous democracy at a moment of increased tensions with rival China have outweighed both the costs and risks.

“The challenges and opportunities facing the world in this century require that India and the United States work and lead together, and we are,” Biden said as he welcomed Modi to the White House.

A festival-like morning ceremony at the White House featured a cappella group Penn Masala performing renditions of songs by the American group Maroon 5 as well as from movies featuring Bollywood superstar Shah Rukh Khan.

After Modi addresses Congress, Biden is set to host the Indian leader for a glittering state dinner on Thursday evening.

US-India deals

Biden administration officials say sweeping agreements to be announced on semiconductors, critical minerals, technology, space cooperation and defence cooperation and sales will ring in a new era in relations between the two countries.

Some are aimed at diversifying supply chains to reduce dependence on China. Others are aimed at cornering the market in advanced technologies that may feature on the battlefields of the future.

The US has also sought to address China’s rising influence in the Indo-Pacific region by bolstering defence ties with countries like India, Japan, Australia, South Korea as well as countries across the Pacific and Southeast Asia.

Here’s a round-up of deals that have been announced or will be:

General Electric (GE) has signed an agreement with India’s state-owned Hindustan Aeronautics Ltd (HAL) to jointly make engines in India to power fighter jets for the Indian Air Force.

The historic deal is the most significant one of all the announcements so far as the US is willing to give India access to critical American technologies such as F414, which it rarely shares with non-allies.

For India, the deal is important as it can help it meet its target with homemade jets powered by homemade engines to keep costs under control and also to avoid becoming dependent on a foreign supplier.

The GE engine in question is called the F414 and it has been used by US Navy aircraft for more than 30 years. HAL uses F414’s predecessor to power its indigenous light combat aircraft called “Tejas”. India is now also working on developing the next-generation Tejas 2 which will be powered by the F414. That engine will also be used in India’s next-generation Advanced Medium Combat Aircraft.

US Navy ships in the region will be able to stop in Indian shipyards for repairs under a maritime agreement, and India will procure US-made armed MQ-9B SeaGuardian drones.

US chipmaker Micron Technology will invest more than $800m towards a new $2.75bn semiconductor assembly and test facility in a new semiconductor testing and packaging unit, to be built in Modi’s home state of Gujarat.

Applied Materials has announced it will build a Semiconductor Centre for Commercialization and Innovation in India to boost’ semiconductor supply chain diversification. And, Lam Research will train 60,000 Indian engineers to accelerate India’s semiconductor education and workforce development goals.

“By increasing our cooperation in fields such as artificial intelligence, semiconductors, space, quantum and telecom, we are creating a strong and futuristic partnership,” Modi said.

The US will also make it easier for skilled Indian workers to get and renew US visas.

India also agreed to join the US-led Artemis Accords on space exploration and to work with NASA on a joint mission to the International Space Station in 2024.

The flurry of agreements comes as some lawmakers have raised serious concerns about democratic backsliding in India.

Several progressive Democrats – including US Representatives Alexandria Ocasio-Cortez, Ilhan Omar and Rashida Tlaib – have said they would boycott Modi’s address to Congress.

Modi will address US CEOs at a reception on Friday, as American companies plan new investments in India.